What is Assessed Value used for?

Assessed Value plays a critical role in the property taxation process. It refers to the dollar value assigned to a property by a municipality for the purpose of taxation. This value is generally determined by the local tax assessor and is used as the basis for calculating property tax bills. Higher assessed values typically lead to higher property taxes, which fund local services such as schools, infrastructure, and emergency services. Therefore, understanding the assessed value is essential for property owners to predict their tax liabilities and for municipalities to estimate their revenue from property taxes.

The other options, while related to real estate, do not directly pertain to the purpose of assessed value. For example, real estate commissions are based on sale prices, market trends involve the fluctuations in values over time, and insurance rates often rely on factors like replacement cost rather than assessed value.