How does Assessed Value differ from Market Value?

Assessed Value and Market Value serve different purposes and are calculated through different methodologies. The correct answer highlights an essential distinction: Market Value reflects the price a property would sell for in the current real estate market, influenced by buyer demand and current economic conditions. It is a dynamic figure that fluctuates based on recent sales, location, and market trends.

On the other hand, Assessed Value is primarily used by tax authorities to determine property taxes. This value is usually calculated at regular intervals (often annually) and may not necessarily reflect the property's current market conditions. Instead, it is often based on criteria such as property size, location, and historical sales data. This valuation can significantly differ from the Market Value depending on local property tax laws and methods of assessment.

While the other options touch on aspects of these values, they do not capture the fundamental difference regarding their application and determination as clearly as the correct choice does. For instance, while it might be true that Assessed Values can sometimes be lower or higher than Market Values, this is not a universal rule. Similarly, the assertion about appraisers determining Assessed Value oversimplifies the processes involved in both valuations. The other options also introduce notions of predictions and historical assessments that do not accurately align with the