Annual Review Assessment Valuations
The process of annually reviewing assessment valuations as of January 1 is referred to as General Reassessment. Annual assessments are made by utilizing accepted professional real estate mass appraisal methods, techniques and standards.
Mass appraisal is defined by the International Association of Assessing Officers (IAAO) as "the process of valuing a group of properties as of a given date, using standard methods, employing common data, and allowing for statistical testing." All real estate assessments are reviewed each year, although not all assessments are changed.
Maintaining correct size and property characteristics on the City of Hampton’s 50,000+ parcels is an important and ongoing effort which is essential to providing fair and equitable assessments.
Change in Assessment Notices
Properties either increasing or decreasing in value from the previous assessment will receive a Notice of Change in Assessment in accordance with the Code of Virginia § 58.1-3330.
Properties not increasing or decreasing in value will not receive a Notice of Change in Assessment.
Analysis Begins with Recent Sales
The reassessment process begins with research of recent sales. The real estate appraisers may disqualify some transfers from the sales analysis if they are not considered to be an arms-length transaction.
Examples of transfers that may not be an arms-length transaction include family transfers, foreclosures, bank sales, estate sales and other distress sales, related to court orders or divorces. It is sometimes necessary for the appraiser to extensively research a property transaction.
With permission a real estate appraiser will make a detailed inspection to confirm the accuracy of the improvement size and property characteristics. An interior inspection is not required. However, interior inspections allow the appraiser to address less than or better than average condition, as well as other interior features of the property. Interior inspections are made by appointment only.
Exterior field visits to the sold properties may be conducted with permission to confirm the size of structure(s), property characteristics, outbuildings and site characteristics, as well as the property's relationship to the surrounding area.
Assessment neighborhoods are defined as a group of complementary land uses (a congruous grouping of inhabitants, buildings, or business enterprises). An assessment neighborhood may include properties from several subdivisions and conversely several assessment areas may be located within the boundaries of a single subdivision.
Sales analysis and reassessment of properties is done by assessment neighborhoods. The analysis begins by measuring the recent arms-length transactions against their previous assessments. The Constitution of Virginia directs real estate assessments to be fair market value.
Market Value is defined by the IAAO as "the most probable price (in terms of money) which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus, as of a specific date."
The assessment divided by the sales price provides the assessment-sales ratio which will suggest if reassessment is needed.