"Never trust anything that can think for itself if you can't see where it keeps its brain."
J.K. Rowling, Harry Potter and the Chamber of Secrets (spoken by the character Arthur Weasley)
The fact that we received a new property tax valuation from Metro only a year after our last reappraisal didn't surprise me. We had, after all, just completed our third and final round of renovations, which involved the replacement of the weed-infested asphalt driveway and tiny garage of our 1930s home in Cherokee Park with a new conglomerate driveway and a carport featuring brick piers and a roof styled like that of our former garage, in keeping with our neighborhood's conservation zoning.
Since we had just received the final bill for this project, I was well aware that our contractor had also notified Metro that he'd completed the job, for which he'd filed a permit the year before. That meant it would be a New York minute before the ever-vigilant Metro Property Tax Assessor's office issued our new appraisal.
But when I opened the envelope in the spring of 2002, I suffered the worst case of sticker shock I'd experienced since Randy and I shopped for our first house in 1983, when interest rates were 13 percent and I discovered that our monthly payment on a $75,000 house would be three times what we were paying in rent. I was particularly chapped because, for the second time in a row, Metro's reassessment of my property value involved simple addition:
Our home's previous assessed value
The exact amount our contractor reported as the contract amount when he applied for the building permit
My very average home was now valued at $505,800.
I turned to a colleague at work, Ken Upchurch, who had just filed a successful appeal for his mother. Ken directed me to a link that allowed me to view the assessed value of every home in my neighborhood. The only house in the entire neighborhood with a higher appraised value than mine was known affectionately as "The Castle." At .19 acres (yes, less than two tenths of an acre), my trapezoidal yard is one of the smallest in the neighborhood. The Castle sits majestically on a double lot. My home now features a carport. The Castle has a stone garage with bays wide enough to accommodate a Hummer. My appraisal was more than twice that of most homes on my block, where comparable houses were appraised at $220,000 to $375,000. Two houses that had recently sold in the mid-$400,000s both had appraisals below their sales prices.
I also discovered that single lots in my neighborhood were assigned a uniform value of $100,000, regardless of size or configuration. My lot, one of the smallest in a neighborhood full of postage-stamp-sized yards, was surely overvalued.
Infuriated, I called the property tax assessor's office to schedule a meeting. The girl on the other end of the phone asked why I was appealing. "Because I'm certain Metro calculated my new appraisal by adding the entire cost of a renovation project to my current value," I snapped.
"If you've made an investment in your house, we assume that all of it increased the value of your house," she said blandly. But she scheduled an appointment for us to meet with a clerk to discuss our appeal.
The day of our appeal, I had assembled a fat package to parade before the tax assessor, which included photos of houses on my street and their current assessed values; a print-out showing how my assessed value compared with those of my neighbors; a list of maintenance activities we'd done and their costs; and an appraisal done when we refinanced our house to finance our renovations, which valued our house at $275,000.
I needn't have bothered. "Other appraisals don't have anything to do with yours," the polite clerk told us. She did nod sympathetically when I pointed out that my house's appraised value was more than twice that of my next-door neighbor's similar house.
I'd also calculated average sales prices per square foot for upgraded houses in our neighborhood, to back my argument that Metro used a high average per-square-foot price to calculate my house's value, which, according to my calculations, should be $365,000.
That was also a useless endeavor. Metro's standard for property tax valuations is "current market value." And they don't really tell you how they arrive at it.
However, she did discover that several key facts used to calculate the value of our house were wrong. She quickly arranged for an appraiser to visit our house and do a reappraisal.
Two weeks later, he showed up, clutching an appraisal sheet, which he scrupulously avoided showing me. First, we walked around my house and discussed square footage. Metro had guesstimated our square footage at 3,800; we actually have about 3,100 square feet.
The appraiser admitted the tax assessor's department had "screwed up" the previous assessment of our neighborhood in the course of a drive-by assessment, assigning values all over the map. "Some people are going to get an unpleasant surprise next time," he accurately predicted.
Then, as we walked up and down the street, looking at the homes I'd identified as comparables and discussing their assessed values, the dickering began.
The appraiser mentioned the two houses that had recently sold in the mid- to high $400s.
I noted that my house had a valuation of $505,800, which was above the recent sale price of any home in our neighborhood over the past year. I mentioned several houses that had sold for between $300,000 and $400,000.
He mentioned a house on the market priced in the $500s.
I pointed out that it hadn't sold yet, and that I'd also heard the owners had done a lot of really expensive work on it, spending much more than we had on our renovations.
After ten minutes of back-and-forth, we sat down at the table on my back patio. "What do you really think your home is worth?" the appraiser asked, looking me straight in the eye.
Having already shared my high average price-per-square-foot proposal, I replied stubbornly, "$365,000."
"Come on, you know you could get more than that," he said.
"No, I don't," I said. "No one knows what they can get for their house until they sell it. Suppose I've papered every wall in the house with life-size Elvises and put in hot pink commodes that play 'Hunka Hunka Burnin' Love' when you lift the lid?"
"You haven't done that," he said.
"No," I admitted. "But the idea of trying to assign the highest possible price somebody might get for their house if they sold it today seems like a crazy way to assess the value of a home for property tax purposes."
"Don't you think you could get at least $400,000?" he asked.
"$365,000," I said. That was my story, and I was sticking to it.
"What's the highest appraisal you would accept?" he asked.
"Well, it's probably going to be in the neighborhood of $390,000," he said.
When our house's new appraised value came in at $375,000, Randy and I went out to celebrate my victory. But it felt hollow. I won my property tax appeal by using the same technique people use at garage sales to buy questionable antiques: dickering.
And the tax assessor's office still usesthese are direct quotes from the Web site"mass appraisal techniques aided by appraisal models of benchmark properties."
Translation: Metro Nashville does not use an objective method that you can verifylike an average square-foot value per neighborhoodto determine your property's value.
That means you either have to trust their assessment of how much you could conceivably sell your house for at the time they deliver your valueor dicker with them.