Enter the assessed/appraised value ($) and the market value ($) into the Assessment Ratio Calculator. The calculator will evaluate and display the Assessment Ratio. 

Assessment Ratio Formula

The following formula is used to calculate the Assessment Ratio. 

ASR = AV / MV 
  • Where ASR is the Assessment Ratio ( )
  • AV is the assessed/appraised value ($) 
  • MV is the market value ($) 

To calculate the assessment ratio, divide the appraised value by the market value.

How to Calculate Assessment Ratio?

The following example problems outline how to calculate Assessment Ratio.

Example Problem #1:

  1. First, determine the assessed/appraised value ($).
    • The assessed/appraised value ($) is given as: 150,000.
  2. Next, determine the market value ($).
    • The market value ($) is provided as: 160,000.
  3. Finally, calculate the Assessment Ratio using the equation above: 

ASR = AV / MV 

The values given above are inserted into the equation below and the solution is calculated:

ASR = 150,000 / 160,000  = .9375


FAQ

What is the difference between assessed/appraised value and market value?

Assessed or appraised value is the dollar value assigned to a property for purposes of measuring applicable taxes or the value determined by an official appraisal, usually for mortgage purposes. Market value, on the other hand, is the price at which a property would sell under current market conditions.

Why is the Assessment Ratio important in real estate?

The Assessment Ratio is important because it helps in understanding the relationship between the assessed value of a property and its market value. This ratio can influence property taxes, investment decisions, and the overall perception of a property’s value in the real estate market.

Can the Assessment Ratio change over time?

Yes, the Assessment Ratio can change over time as it is dependent on fluctuations in both the assessed/appraised value and the market value of a property. Changes in the real estate market, improvements to the property, or changes in tax laws can all affect these values and, consequently, the Assessment Ratio.