What must be my bid if the taxable value of a house is ... ?

Question

I am a first time home buyer and have identified a property that has a taxable value of 136,000 from the county. The following table shows the rate of appreciation in taxable value:
2002 - 108,000
2003, 04, 05 - 113,000
2006, 07 - 136,000

Its for sale by owner. There are 3 properties in the vicinity that are on sale for the past 6 months. This one is in market for the past 3 weeks and the owner now has a For Rent sign as well.

I am not sure how much my first bid should be. Help me!!!!!!!!

Answer 1

Do not rely on 'taxable value' from a tax assessment. They are notoriously unreliable compared to market values.

As an example, Winnebago County, Illinois, has $200,000 properties assessed for about $60,000. There is no guarantee that a tax assessment even remotely mirrors the market value of the property.

You need to do comparisons with recent sales of similar properties in the vicinity to get a good guide of market values.

Answer 2

Tax assessed value is not a reliable barometer for real value. Neither is Zillow. My county assesses my property for about 20% less than real market value, and Zillow is a joke.

In order to form a good first bid, you will have to know what comparable properties have sold for in that area.

Bear in mind that most FSBO are overpriced, that is just the way it is. Although I tell my sellers that this is business, some take offers persoonally and are offended by lower offers, so keep that in the back of your mind.

Think about 10% below market value.