Market Value and Classification
Estimated market value for property tax purposes is the likely price a property would sell for on the open market. Market value is defined in Minnesota Statute 272.03 Subdivision 8. State law requires that the value and classification of real estate be established as of January 2nd of each year.
The office works throughout the year to estimate the market value of each property along with classifying by use for the following January 2nd.
The Process of Property Valuation/Classification
- Market values are determined every January 2nd.
- Assessors must view each piece of real estate at least once every five years to assess its market value.
- Property values change with changing market conditions.
- Physical changes may have an effect on the value of land and buildings.
- Classify each parcel by its use(examples include: agricultural, commercial/industrial and residential.)
Valuation and Classification Notice
An assessment notice is mailed in early spring to each property owner. This form will state the estimated market value of the property from January 2nd of the current year and the classification of the property (ie, residential, commercial, agricultural). It will also give you information on how to appeal the estimated market value or classification, if you feel an error has been made on your property record. The values on this notice will be used to calculate the taxes payable in the following year.
If you have any questions or more information is desired, please contact our office.
Valuation and Classification Notice Definitions
- Estimated Market Value - This value is what the assessor estimates your property would likely sell for on the open market.
- Exclusion for Veterans With Disabilities - Veterans with qualifying disabilities may be eligible for a valuation exclusion on their homestead property.
- Green Acres - Only applies to agricultural property that is facing increasing value due to development pressures not related to the agricultural value of the land. The assessor arrives at this lower value by looking at what comparable agricultural land is selling for in areas where there is no development pressure. The taxes on the higher value are deferred until the property is sold or no longer qualifies for the program.
- Homestead Market Value Exclusion - Applies to residential homesteads and to the house, garage and one acre of land for agricultural homesteads. The exclusion is a maximum of $30,400 at $76,000 of market value, and then decreases by nine percent for value over $76,000. the exclusion phases out for properties valued a $413,800 or more.
- JOBZ - Qualifying businesses within Job Opportunity Business Zone may be eligible for a partial property tax exemption.
- New Improvements - The is the assessor's estimate of the value or new or previously unassessed improvements you have made to your property.
- Plat Deferment - For land that has been recently platted (divided into individual lots) but not yet improved with a structure, the increased market value due to platting is phased in over time. If construction begins, or if the lot is sold before expiration of the phase-in period, the lot will be assessed a full market value in the next assessment.
- Rural Preserve - Applies to class 2b rural vacant land that is part of a farm homestead or that had previously been enrolled in Green Acres, if it is contiguous to agricultural land enrolled in Green Acres. This value may not exceed the Green Acres values for tilled lands. the taxes on the higher value are deferred so long as the property qualifies.
- Taxable Market Value - This is the value that your property taxes are actually based on, after all reductions.