Property Tax Appeals in the Post-COVID Market: Assessment Lag Issues
TL;DR
COVID-era market surges drove assessments to record highs. Now that many markets have cooled, those peak-era assessments may overstate current values. If your assessment reflects 2021-2022 peak prices but your market has since declined, appeal using recent comparable sales showing lower values. The assessment lag that helped homeowners during the run-up now works against them as prices stabilize or fall.
The Post-COVID Assessment Problem
During 2020-2022, home prices surged 20-40% in many markets. Assessors updated values accordingly, sometimes with a one to two year lag. Now several things have changed:
- Mortgage rates more than doubled from pandemic lows
- Buyer demand has cooled significantly
- Prices have flattened or declined in many markets
- Affordability constraints limit what buyers can pay
But assessments in many areas still reflect the peak. If your assessment was set using 2021-2022 sales data and your market has since cooled, you may be paying taxes on inflated values.
How to Prove the Market Has Changed
Recent Comparable Sales
Pull sales from the most recent 6 months. Compare them to sales from the period used to set your assessment. If recent sales are 5-15% lower, the market has corrected and your assessment should follow.
Days on Market Trends
Show that homes are taking longer to sell than during the surge. Longer marketing times indicate reduced demand and downward price pressure.
Price Reduction Data
Active listings with price cuts demonstrate that sellers are adjusting expectations downward. This is real-time market evidence.
Mortgage Rate Impact
Higher mortgage rates directly reduce buying power. A buyer who qualified for $400,000 at 3% can only afford roughly $300,000 at 7%. This caps what homes can sell for.
The Assessment Date Matters
Every jurisdiction has an official valuation date for the assessment. Your evidence needs to show market conditions as of that date, not necessarily today. If the valuation date was January 1, 2026, show what comparable homes were selling for around that date.
For general guidance on declining market appeals, see our declining market appeal guide.
Frequently Asked Questions
What should I know about property tax appeals in the post-covid market: assessment lag issues?
COVID-era market surges drove assessments to record highs. Now that many markets have cooled, those peak-era assessments may overstate current values. If your assessment reflects 2021-2022 peak prices but your market has since declined, appeal using recent comparable sales showing lower values.
What should I know about the post-covid assessment problem?
During 2020-2022, home prices surged 20-40% in many markets. Assessors updated values accordingly, sometimes with a one to two year lag. Now several things have changed:
How to Prove the Market Has Changed?
Pull sales from the most recent 6 months. Compare them to sales from the period used to set your assessment. If recent sales are 5-15% lower, the market has corrected and your assessment should follow.
What should I know about the assessment date matters?
Every jurisdiction has an official valuation date for the assessment. Your evidence needs to show market conditions as of that date, not necessarily today. If the valuation date was January 1, 2026, show what comparable homes were selling for around that date.
Get Current Market Evidence
Our $79 Evidence Packet pulls the most recent comparable sales data, reflecting where the market is now, not where it was during the pandemic surge.