County's Values Relative to Real Estate Market

Sales ratio studies conducted by this office and filed with the State Tax Commission (STC) of Missouri, on a quarterly basis, during 2009 and 2010 indicated the assessed values on the Assessor’s books were below true value in money ([fair] market value, see Note 1), or below being at 100% of what property had actually sold for, as of January 1, 2011. An assessor is able to compare their appraised value (which generally does not change for two years) for a property that has sold to the selling price of the property (see Note 2). This ratio tells an assessor what percent their appraised value is of the selling price. A ratio of one (100%) means the assessor is reflecting market value. A ratio over one means the level of appraised value exceeds the actual selling prices. A ratio less than one means the assessor is under appraising relative to the actual selling prices in the open market. Statistical studies are performed on these ratios to find measures of central tendency and measures of variability. The results of this statistical analysis (see Note 3) are listed below:

2nd Quarter 2011: 0.88, or 88%
1st Quarter 2011: 0.88, or 88%

4th Quarter 2010, for 2009 and 2010 sales: 0.92, or 92%

4th Quarter 2010: 0.92, or 92%
3rd Quarter 2010: 0.90, or 90%
2nd Quarter 2010: 0.89, or 89%
1st Quarter 2010: 0.89, or 89%

4th Quarter 2009: 0.93, or 93%
3rd Quarter 2009: 0.93, or 93%
2nd Quarter 2009: 0.95, or 95%
1st Quarter 2009: 0.96, or 96%

4th Quarter 2008: 0.90, or 90%
3rd Quarter 2008: 0.89, or 89%
2nd Quarter 2008: 0.89, or 89%
1st Quarter 2008: 0.89, or 89%

4th Quarter 2007: 0.89, or 89%
3rd Quarter 2007: 0.87, or 87%
2nd Quarter 2007: 0.88, or 88%
1st Quarter 2007: 0.89, or 89%

Notes:

Note 1: Market value is defined as:
“The most probable price 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 knowledgably, and assuming the price is not affected by
undue stimulus. Implicit in this definition are the consummation of a sale as of a
specified date and the passing of title from seller to buyer whereby:
1. Buyer and seller are typically motivated;
2. Both parties are well informed or well advised and acting in what they
consider their own best interests;
3. A reasonable time is allowed for exposure in the open market;
4. Payment is made in terms of cash in U.S. dollars or in terms of financial
arrangements comparable thereto; and
5. The price represents the normal consideration for the property sold unaffected
by special or creative financing or sales concessions granted by anyone
associated with the sale.”
(IAAO Standard on Ratio Studies 2007 and Title XI FIRREA 1990)

Note 2: Assessor’s in the State of Missouri follow strict rules; rules recommended by the International Association of Assessing Officers (IAAO) and by the STC, regarding the types of sales allowed in these studies. In essence these sales have to be arms-length open market sales. In general, foreclosure, auction, buyer/seller related, owner owned adjoining, to name a few types of sales, are not eligible in the assessor’s studies. In fact the STC states the following sales are generally invalid for ratio studies: sales involving government agencies and public utilities; charitable, religious, or educational institutions; financial institutions; relatives or corporate affiliates; settlements of estate; forced sales; sales of doubtful title; and sales with special conditions involving trades, partial interests, land contracts, incomplete or unbuilt common property, and auctions. The definition of a sale that Missouri assessors use is:

Note 3: The ratio from one quarter to another indicates the cumulative or aggregate ratio for all sales from the beginning of each year through the period ending indicated. In other words the ratio is a year-to-date as of the end of the quarter’s calendar date. This stabilizes changes in the market from one time period to another, showing a ‘net’ result for a year (or period ending) rather than the fluctuations from quarter to quarter.