Wondering if you’re paying too much in property taxes?

Start by figuring out the Common Level Ratio

The Common-Level-Ratio is used every day in the real estate community but is a mystery to most property owners and many real estate professionals. Since Counties do not reassess every year a method to measure increases in values is necessary to aid in assessing newly built improvements or recent subdivisions.

The Commonwealth of Pennsylvania collects a transfer tax of one (1%) percent on each sale. They keep tract of these transactions and develop what is known as the STEB (State Tax Equalization Board) report for each County. By taking the total value of sales and dividing the current assessments they then have a factor or a percentage that they can then use to assess as new house or office building.

As an example, if the total transfer tax in a County totaled $200,000,000 for the year and the assessments on these properties were $100,000,000 the Common-Level-Ratio would be 2.0 or 50% for the calendar year. When values change, the ratio changes. After a reassessment the CLR reverts to 100%, but today if the ratio was 75% (as in Dauphin County) and your tax bill states your property is assessed at $225,000, the market value is actually $300,000 ($225,000 •*• .75).

So the next time you receive your tax bill take a minute to look at your assessment and find your CLR. That will help you determine what your county tax assessor believes is the real market value of your property.

Are you over-assessed, under-assessed or right on?

If the answer is over-assessed, call us today at 717-763-1212 and learn how we can help.