Are you seeing two different numbers for your home’s value and wondering which one actually matters? You are not alone. In Madison and across Dane County, the assessed value on your tax bill and the appraised value from a lender often do not match. In this guide, you will learn what each value means, why they diverge, and how to use them to price, negotiate, and plan for taxes this spring. Let’s dive in.
Assessed vs. appraised: the basics
Assessed value is set by your local assessor for property tax purposes. In Wisconsin, assessors aim to estimate full market value as of a set valuation date, commonly January 1 of the assessment year. That assessed value appears on the tax roll and helps determine your property tax bill.
Appraised value is prepared by a licensed appraiser for a specific purpose and date, often tied to a mortgage. Lender appraisals follow USPAP standards and lender rules. The appraised value is event driven, which means it reflects market conditions on the day of the appraisal.
Both values try to reflect market value, which is the price a willing buyer and seller would likely agree to on a given date. The key difference is purpose and timing. One exists to administer taxes. The other exists to support a loan.
Why values differ in Madison
Different purpose and timing
Assessments run on municipal cycles and use a fixed valuation date. Appraisals are done at the moment of a transaction. If prices moved after January 1, your assessment can lag what an appraiser sees in today’s market.
Methods and data depth
Assessors use mass-appraisal models across many properties. Appraisers focus on one property with a sales comparison, cost, or income approach and an on-site inspection. That property-by-property analysis can pick up condition, finishes, or layout details that a mass assessment may miss.
Property information gaps
Assessor records may be outdated on square footage, finished basements, accessory units, or recent renovations. Appraisers verify these details and adjust for them, which can lead to a different value.
Revaluation cycles and lag
Even with periodic revaluations, municipal schedules can trail fast market shifts. In a rising market, assessments may sit below recent sale prices. In a cooling market, the reverse can happen.
State equalization context
Wisconsin’s Department of Revenue publishes equalization ratio studies to show how close a municipality’s assessments are to market levels on average. A ratio not at 100 percent signals a systematic difference that helps explain why your assessed value may not match recent sale activity.
Unique homes and low-sales areas
Historic properties, large lots, or atypical designs can be harder to model. Fewer comparable sales increase uncertainty for both assessments and appraisals, which can widen the gap.
What each value means for you
For sellers
The appraisal matters because most buyers finance. If the appraised value comes in below the contract price, the buyer may need to bring more cash, you may renegotiate, or the deal could end if there is an appraisal contingency. The assessed value matters less for pricing and more for buyer perception and taxes. Price using market data such as comparable sales, a broker’s CMA, or a pre-listing appraisal.
For buyers
The appraisal is central to your loan approval. Your lender will base the loan-to-value on the appraised number. The assessed value is a due diligence data point. It helps you understand tax history and trends but rarely drives underwriting decisions. If an appraisal is low, you can renegotiate, bridge the gap with cash, request a reconsideration of value, or exit under your appraisal contingency if your contract allows.
For property taxes and budgeting
Your tax bill is tied to the assessed value, adjusted by exemptions and local mill rates. A sale does not automatically change your assessed value for the current year. Assessors consider recent sales when they revalue during the next cycle. Always budget using the assessor’s current value and tax history.
For negotiations
Assessed value is not a market-price tool. It can inform context, but your offer or list price should come from current comps, market trends, and an appraisal or CMA. Clear communication about this difference reduces confusion in the spring market.
How to use each value this spring
- Use the appraised value or a strong CMA to set and support price, especially if your assessed value looks low versus recent sales.
- Reference the assessed value to plan your annual carrying costs. Factor in tax trends when modeling affordability.
- Track local notices from the assessor and watch for revaluation years. A revaluation can shift assessed values and tax bills.
- If your home is unique or the market is moving fast, a pre-listing appraisal can help prevent surprises after you accept an offer.
Where to find your numbers
- Dane County property records provide parcel-level data, including current assessments and tax history. Search by address or parcel number.
- The City of Madison Assessor’s Office maintains property cards, sketches, and notes for homes within city limits.
- The Wisconsin Department of Revenue publishes equalization ratio reports and assessment guidance that show how local assessed values compare to market on average.
If the assessment seems off
Start by checking the assessor’s data for accuracy. Compare square footage, bedroom and bathroom counts, finished areas, accessory units, and major updates. Gather evidence such as contractor invoices, photos, and recent comparable sales. If you have a fee appraisal, include it.
If you still disagree, follow your municipality’s Board of Review process. Deadlines and procedures vary by city or town. The Board of Review is the first formal appeal step in Wisconsin. Present clear evidence: recent comps, a current appraisal, and any errors in the assessor’s records. Be sure to verify your community’s exact timeline and filing rules.
If the appraisal comes in low
A low appraisal does not have to end your deal. Common options include:
- Renegotiate the purchase price to the appraised value.
- Bring additional cash to bridge the gap.
- Request a reconsideration of value by supplying better comparable sales and documentation through your lender.
- Ask about a second appraisal if allowed by lender policy.
For sellers, sharing a list of recent updates and providing quality comparable sales to the appraiser can help support value. If your property is unique, consider a pre-listing appraisal to reduce risk.
Smart prep for Madison’s spring market
- Sellers: anchor pricing to current comps, not the assessed value. If your assessment is significantly lower than recent sales, prepare appraiser packets with updates, permits, and nearby comps. If it is much higher, have a market narrative ready to explain neighborhood trends and unique features.
- Buyers: when bidding above recent sales, understand your appraisal risk and decide in advance whether you can add cash, renegotiate, or walk away under your contingency. Budget taxes based on the current assessment and mill rate, not a guess of where assessments might go.
- Both: track municipal assessment notices and review Wisconsin DOR equalization trends for your area. These tools help you anticipate whether assessments are likely to rise, fall, or stay in line with market movements.
Work with a trusted team
You deserve a clear plan and calm guidance when numbers do not match. Our team pairs local market fluency with a streamlined, systems-driven process so you can move forward with confidence. With 1,450-plus homes sold and more than $550 million in closed sales, we bring the market perspective and negotiation experience you need for pricing, appraisal, and tax questions in Madison and across Dane County.
Ready to align your pricing, appraisal strategy, and tax planning for spring? Connect with the Phair-Hinton Group. We will answer your questions, run the right comps, and help you prepare a winning plan.
FAQs
Which value sets my Dane County property taxes?
- The assessed value from your local assessor is used to calculate property taxes, subject to exemptions and the local mill rate.
Which value matters to my mortgage lender in Madison?
- The appraised value from a licensed appraiser, usually ordered by your lender, determines loan-to-value and mortgage approval.
Does a Madison home sale change my assessment right away?
- Not immediately. Your sale price is data for the next assessment cycle, and timing depends on your municipality’s valuation date and schedule.
Can I appeal my assessment if I have a lower appraisal?
- Yes. You can appeal through your municipality’s Board of Review and present evidence such as a current appraisal and recent comparable sales.
Should I use assessed value to set my list price?
- No. Set price using current market comps, a broker’s CMA, or a pre-listing appraisal. The assessed value is mainly for tax purposes.
What if a lender appraisal is lower than my offer price?
- You can renegotiate the price, add cash to cover the gap, request a reconsideration of value, seek a second appraisal if allowed, or exit under your appraisal contingency.
Where can I find my Madison property’s assessed data?
- Check Dane County property records and the City of Madison Assessor’s Office for your property card, assessment history, and building details.
