Schedule of Values

10 JOHNSTON COUNTY NORTH CAROLINA 2025 SCHEDULE OF VALUES 2025 USE VALUE SCHEDULEPageJOHNSTON COUNTY 2025 SCHEDULE OF VALUES TABLE OF CONTENTS Chapter Content 1 Introduction 1A Standards 5 & 6 Mass Appraisal Development 2 Sales Utilization and Fair Market Value 3 Mapping 4 Land Appraisal Procedures 5 Data Collection Procedures in the Field 6 Data Collection Software 7 Calculation of System Values 8 Income Property Valuation 9 Valuation of Special Properties 10 Statistics and the Appraisal Process 11 County Specifications 12 AppendixPageCHAPTER 1 IntroductionPageINTRODUCTION The primary purpose of real property assessment is to arrive at a fair and just valuation market value of all real property for use in deriving property taxes that will be as equitable as is feasible given the time , staff and money available to the assessor Market value as defined by Machinery Act of North Carolina under GS 105283 Uniform Appraisal Standards is the price estimated in terms of money at which the property would change hands between a willing and financially able buyer and a willing seller , neither being under any compulsion to buy or to sell and both having reasonable knowledge of all the uses to which the property is adapted and for which it is capable of being used To determine just and equitable values the assessor must turn to mass appraisal methods and techniques based on solid appraisal principles In mass appraising , as in any kind of appraising , the realities of the local market along with state and local laws must be considered Also , fundamental to any mass appraisal system are knowledge , judgment and the ability to adapt a standardized system to the local market A standardized system and method of handling both data and the application of the three basic approaches to value is necessary to achieve equalization and uniformity in the valuation process The three basic approaches which may be used to arrive at a fair market value are summarized as follows COST APPROACH This approach consists of estimating the land value and the depreciated cost of the improvements to arrive at a value Theoretically , the substitution principle is the basis for determining the maximum value of the property by this approach The substitution principle assumes the value is equal to the cost of acquiring a substitution of equal utility assuming no cost delay is encountered The cost approach is applicable to virtually all improved parcels and , if used properly , can produce highly accurate valuations The cost approach is more reliable for newer structures of standard materials , design , and workmanship Reliable cost data is imperative in any successful application of the cost approach The data must be complete , typical and current Current construction costs should be based on the cost of replacing a structure with one of equal utility , using current materials , design , and building standards Costs of individual construction components and building items should also be included in order to adjust for features that differ from the base specifications These costs should be incorporated into a construction cost manual and related computer software The software can perform the valuation function , and the manual , in addition to providing documentation , and can be used when non - automated calculations are required Construction cost schedules can be developed internally , based on a systematic study of local construction costs , obtained from firms specializing in such information , or custom generated by a contractor Cost schedules should be verified for accuracy by applying them to recently constructed improvements of known cost Construction costs also should be updated before each assessment cycle MARKET APPROACH This approach utilizes the application of prior sales data from the market and is also referred to as the sales or comparison approach Use of this approach requires that the sales used should be analyzed to determine that the conditions of fair market value have been satisfied 1 - 1 9 3 2024PagePage pageNumber5The sales comparison approach estimates the value of a subject property by analyzing the sales prices of similar properties or properties of like nature , relevant in terms of features and attributes that are determinants of value in a marker within a given time frame Mass appraisal programs should be able to adjust sales prices for date of sale Adjustments should be considered for financing , personal property , assumed leases , delinquent taxes and special assessments Reliability of the sales comparison approach rests on the number and quality of available sales When sufficient valid sales are available , this approach tends to be the preferred valuation method INCOME APPROACH In general , for income - producing properties the income approach is the preferred valuation approach when reliable income and expense data are available , along with well - supported income multipliers , overall rates , and required rates of return on investment Successful application of the income approach requires the collection , maintenance , and careful analysis of income and expense data The two most common applications of this approach in mass appraising are the capitalized net income and the gross rent multiplier The use of any of the three approaches requires careful consideration to be given to 1 The relevancy of the approach applied to the property under consideration 2 The inherent strengths and weaknesses of the approach used 3 The amount and reliability of the data collected 4 The effect of the local market on the data collected Finally , it must be remembered , the true test of a mass appraisal system rests upon its acceptance by the assessor , the taxpayers and administrative review bodies such as the Department of Revenue and the courts The material contained in the manual is provided to enable the user to apply standard procedures to the mass appraisal of property In certain cases , the procedures are manually implemented and controlled ; in others , the highly sophisticated data processing and appraisal systems are available to assure standard methods are employed The principle to be recognized is that of standardization of data and operations as a vehicle to achieving the goals of the appraisal system 1 - 2 9 3 2024PagePage pageNumber6Machinery Act The Machinery Act of North Carolina contains the statutory provisions that pertain to listing , appraisal , and assessment of property and the collection of taxes on property The following sections from Chapter 105 , Subchapter II of the North Carolina General Statues is not an all - inclusive list of applicable North Carolina statutes Article 13 Standards for Appraisal and Assessment § 105 - 283 Uniform appraisal standards All property , real and personal , shall as far as practicable be appraised or valued at its true value in money When used in this Subchapter , the words true value shall be interpreted as meaning market value , that is , the price estimated in terms of money at which the property would change hands between a willing and financially able buyer and a willing seller , neither being under any compulsion to buy or to sell and both having reasonable knowledge of all the uses to which the property is adapted and for which it is capable of being used For the purposes of this section , the acquisition of an interest in land by an entity having the power of eminent domain with respect to the interest acquired shall not be considered competent evidence of the true value in money of comparable land 1939 , c 310 , s 500 ; 1953 , c 970 , s 5 ; 1955 , c 1100 , s 2 ; 1959 , c 682 ; 1967 , c 892 , s 7 ; 1969 , c 945 , s 1 ; 1971 , c 806 , s 1 ; 1973 , c 695 , s 11 ; 1977 , 2nd Sess , c 1297 § 105 - 284 Uniform assessment standard a Except as otherwise provided in this section , all property , real and personal , shall be assessed for taxation at its true value or use value as determined under GS 105 - 283 or GS 105 - 2776 , and taxes levied by all counties and municipalities shall be levied uniformly on assessments determined in accordance with this section b The assessed value of public service company system property subject to appraisal by the Department of Revenue under GS 105 - 335 b 1 shall be determined by applying to the allocation of such value to each county a percentage to be established by the Department of Revenue The percentage to be applied shall be either 1 The median ratio established in sales assessment ratio studies of real property conducted by the Department of Revenue in the county in the year the county conducts a reappraisal of real property and in the fourth and seventh years thereafter ; or 2 A weighted average percentage based on the median ratio for real property established by the Department of Revenue as provided in subdivision 1 and a one hundred percent 100 ratio for personal property No percentage shall be applied in a year in which the median ratio for real property is ninety percent 90 or greater If the median ratio for real property in any county is below ninety percent 90 and if the county assessor has provided information satisfactory to the Department of Revenue that the county follows accepted guidelines and practices in the assessment of business personal property , the weighted average percentage shall be applied to public service company property In calculating the weighted average percentage , the Department shall use the assessed value figures for real and personal property reported by the county to the Local Government Commission for the preceding year In any county which fails to demonstrate that it follows accepted guidelines and practices , the percentage to be applied shall be the median ratio for real property The percentage established in a year in which a sales assessment ratio study is conducted shall continue to be applied until another study is conducted by the Department of Revenue c Notice of the median ratio and the percentage to be applied for each county shall be given by the Department of Revenue to the chairman of the board of commissioners not later than April 15 of the year for which it is to be effective Notice shall also be given at the same time to the public service companies whose property values are subject to adjustment under this section Either the county or an affected public service company may challenge the real property ratio or the percentage established by the Department of Revenue by giving notice of exception within 30 days after the mailing of the Departments notice Upon receipt of such notice of exception , the Department shall arrange a conference with the challenging party or parties to review the matter Following the conference , the Department shall notify the challenging party or parties of its final determination in the matter Either party may appeal the Departments determination to the Property Tax Commission by giving notice of appeal within 30 days after the mailing of the Departments decision 1 - 3 9 3 2024PagePage pageNumber7 d Property that is in a development financing district and that is subject to an agreement entered into pursuant to GS 159 - 108 shall be assessed at its true value or at the minimum value set out in the agreement , whichever is greater 1939 , c 310 , s 500 ; 1953 , c 970 , s 5 ; 1955 , c 1100 , s 2 ; 1959 , c 682 ; 1967 , c 892 , s 7 ; 1969 , c 945 , s 1 ; 1971 , c 806 , s 1 ; 1973 , c 695 , s 12 ; 1985 , c 601 , s 1 ; 1987 Reg Sess , 1988 , c 1052 , s 1 ; 2003 - 403 , s 20 § 105 - 286 Time for general reappraisal of real property a Octennial Cycle - Each county must reappraise all real property in accordance with the provisions of GS 105 - 283 and GS 105 - 317 as of January 1 of the year set out in the following schedule and every eighth year thereafter , unless the county is required to advance the date under subdivision 2 of this section or chooses to advance the date under subdivision 3 of this section 1 Schedule of Initial Reappraisals Division One - 1972 Avery , Camden , Cherokee , Cleveland , Cumberland , Guilford , Harnett , Haywood , Lee , Montgomery , Northampton , and Robeson Division Two - 1973 Caldwell , Carteret , Columbus , Currituck , Davidson , Gaston , Greene , Hyde , Lenoir , Madison , Orange , Pamlico , Pitt , Richmond , Swain , Transylvania , and Washington Division Three - 1974 Ashe , Buncombe , Chowan , Franklin , Henderson , Hoke , Jones , Pasquotank , Rowan , and Stokes Division Four - 1975 Alleghany , Bladen , Brunswick , Cabarrus , Catawba , Dare , Halifax , Macon , New Hanover , Surry , Tyrrell , and Yadkin Division Five - 1976 Bertie , Caswell , Forsyth , Iredell , Jackson , Lincoln , Onslow , Person , Perquimans , Rutherford , Union , Vance , Wake , Wilson , and Yancey Division Six - 1977 Alamance , Durham , Edgecombe , Gates , Martin , Mitchell , Nash , Polk , Randolph , Stanly , Warren , and Wilkes Division Seven - 1978 Alexander , Anson , Beaufort , Clay , Craven , Davie , Duplin , and Granville Division Eight - 1979 Burke , Chatham , Graham , Hertford , Johnston , McDowell , Mecklenburg , Moore , Pender , Rockingham , Sampson , Scotland , Watauga , and Wayne 2 Mandatory Advancement - A county whose population is 75,000 or greater according to the most recent annual population estimates certified to the Secretary by the State Budget Officer must conduct a reappraisal of real property when the countys sales assessment ratio determined under GS 105 - 289 h is less than 85 or greater than 115 , as indicated on the notice the county receives under GS 105 - 284 A reappraisal required under this subdivision must become effective no later than January 1 of the earlier of the following years a The third year following the year the county received the notice b The eighth year following the year of the countys last reappraisal 3 Optional Advancement - A county may conduct a reappraisal of real property earlier than required by subdivision 1 or 2 of this subsection if the board of county commissioners adopts a resolution providing for advancement of the reappraisal The resolution must designate the effective date of the advanced reappraisal and may designate a new reappraisal cycle that is more frequent than the octennial cycle set in subdivision 1 of this subsection The board of county commissioners must promptly forward a copy of the resolution adopted under this subdivision to the Department of Revenue A more frequent reappraisal cycle designated in a resolution adopted under this subdivision continues in effect after a mandatory reappraisal required under subdivision 2 of this subsection unless the board of county commissioners adopts another resolution that designates a different date for the countys next reappraisal b , c Repealed by Session Laws 2008 - 146 , s 11 , effective July 1 , 2009 1939 , c 310 , s 300 ; 1941 , c 282 , ss 1 , 11 2 ; 1943 , c 634 , s 1 ; 1945 , c 5 ; 1947 , c 50 ; 1949 , c 109 ; 1951 , c 847 ; 1953 , c 395 ; 1955 , c 1273 ; 1957 , c 1453 , s 1 ; 1959 , c 704 , s 1 ; 1971 , c 806 , s 1 ; 1973 , c 476 , s 193 ; 1987 , c 45 , s 1 ; 2008 - 146 , s 11 1 - 4 9 3 2024PagePage pageNumber8Article 19 Administration of Real and Personal Property Appraisal § 105 - 317 Appraisal of real property ; adoption of schedules , standards , and rules a Whenever any real property is appraised it shall be the duty of the persons making appraisals 1 In determining the true value of land , to consider as to each tract , parcel , or lot separately listed at least its advantages and disadvantages as to location ; zoning ; quality of soil ; waterpower ; water privileges ; dedication as a nature preserve ; conservation or preservation agreements ; mineral , quarry , or other valuable deposits ; fertility ; adaptability for agricultural , timber - producing , commercial , industrial , or other uses ; past income ; probable future income ; and any other factors that may affect its value except growing crops of a seasonal or annual nature 2 In determining the true value of a building or other improvement , to consider at least its location ; type of construction ; age ; replacement cost ; cost ; adaptability for residence , commercial , industrial , or other uses ; past income ; probable future income ; and any other factors that may affect its value 3 To appraise partially completed buildings in accordance with the degree of completion on January 1 b In preparation for each revaluation of real property required by GS 105 - 286 , it shall be the duty of the assessor to see that 1 Uniform schedules of values , standards , and rules to be used in appraising real property at its true value and at its present - use value are prepared and are sufficiently detailed to enable those making appraisals to adhere to them in appraising real property 2 Repealed by Session Laws 1981 , c 678 , s 1 3 A separate property record be prepared for each tract , parcel , lot , or group of contiguous lots , which record shall show the information required for compliance with the provisions of GS 105 - 309 insofar as they deal with real property , as well as that required by this section The purpose of this subdivision is to require that individual property records be maintained in sufficient detail to enable property owners to ascertain the method , rules , and standards of value by which property is appraised 4 The property characteristics considered in appraising each lot , parcel , tract , building , structure and improvement , in accordance with the schedules of values , standards , and rules , be accurately recorded on the appropriate property record 5 Upon the request of the owner , the board of equalization and review , or the board of county commissioners , any particular lot , parcel , tract , building , structure or improvement be actually visited and observed to verify the accuracy of property characteristics on record for that property 6 Each lot , parcel , tract , building , structure and improvement be separately appraised by a competent appraiser , either one appointed under the provisions of GS 105 - 296 or one employed under the provisions of GS 105 - 299 7 Notice is given in writing to the owner that he is entitled to have an actual visitation and observation of his property to verify the accuracy of property characteristics on record for that property c The values , standards , and rules required by subdivision b 1 shall be reviewed and approved by the board of county commissioners before January 1 of the year they are applied The board of county commissioners may approve the schedules of values , standards , and rules to be used in appraising real property at its true value and at its present - use value either separately or simultaneously Notice of the receipt and adoption by the board of county commissioners of either or both the true value and present - use value schedules , standards , and rules , and notice of a property owners right to comment on and contest the schedules , standards , and rules shall be given as follows 1 The assessor shall submit the proposed schedules , standards , and rules to the board of county commissioners not less than 21 days before the meeting at which they will be considered by the board On the same day that they are submitted to the board for its consideration , the assessor shall file a copy of the proposed schedules , standards , and rules in his office where they shall remain available for public inspection 2 Upon receipt of the proposed schedules , standards , and rules , the board of commissioners shall publish a statement in a newspaper having general circulation in the county stating a That the proposed schedules , standards , and rules to be used in appraising real property in the county have been submitted to the board of county commissioners and are available for public inspection in the assessors office ; and 1 - 5 9 3 2024PagePage pageNumber9b The time and place of a public hearing on the proposed schedules , standards , and rules that shall be held by the board of county commissioners at least seven days before adopting the final schedules , standards , and rules 3 When the board of county commissioners approves the final schedules , standards , and rules , it shall issue an order adopting them Notice of this order shall be published once a week for four successive weeks in a newspaper having general circulation in the county , with the last publication being not less than seven days before the last day for challenging the validity of the schedules , standards , and rules by appeal to the Property Tax Commission The notice shall state a That the schedules , standards , and rules to be used in the next scheduled reappraisal of real property in the county have been adopted and are open to examination in the office of the assessor ; and b That a property owner who asserts that the schedules , standards , and rules are invalid may except to the order and appeal therefrom to the Property Tax Commission within 30 days of the date when the notice of the order adopting the schedules , standards , and rules was first published d Before the board of county commissioners adopts the schedules of values , standards , and rules , the assessor may collect data needed to apply the schedules , standards , and rules to each parcel in the county 1939 , c 310 , s 501 ; 1959 , c 704 , s 4 ; 1967 , c 944 ; 1971 , c 806 , s 1 ; 1973 , c 476 , s 193 ; c 695 , s 5 ; 1981 , c 224 ; c 678 , s 1 ; 1985 , c 216 , s 2 ; c 628 , s 4 ; 1987 , c 45 , s 1 ; c 295 , s 1 ; 1997 - 226 , s 5 NOTE The Machinery Act of North Carolina is considered an integral part of the Schedule of Values Any applicable law or standard not recited with this text is hereafter included by reference as part of this document 1 - 6 9 3 2024Page0CHAPTER 1A Standards 5 & 6 Mass Appraisal DevelopmentPage1Uniform Standards of Professional Appraisal Practice 2024 EDITION by the Appraisal Standards Board of The Appraisal Foundation The purpose of the Uniform Standards of Professional Appraisal Practice USPAP is to promote and maintain a high level of public trust in appraisal practice by establishing requirements for appraisers It is essential that appraisers develop and communicate their analyses , opinions , and conclusions to intend users of their services in a manner that is meaningful and not misleading The Appraisal Standards Board promulgates USPAP for both appraisers and users of appraisal services The appraiser’s responsibility is to protect the overall public trust and it is the importance of the role of the appraiser that places ethical obligations on those who serve in this capacity USPAP reflects the current standards of the appraisal profession USPAP addresses the ethical and performance obligations of appraisers through DEFINITIONS , Rules , Standards , Standards Rules , and Statements there are currently no active Statements • The DEFINITIONS establish the application of certain terminology in USPAP • The ETHICS RULE sets forth the requirements for integrity , impartiality , objectivity , independent judgment , and ethical conduct • The RECORD KEEPING RULE establishes the workfile requirements for appraisal and appraisal review assignments • The COMPETENCY RULE presents pre - assignment and assignment conditions for knowledge and experience • The SCOPE OF WORK RULE presents obligations related to problem identification , research , and analyses • The JURISDICTIONAL EXCEPTION RULE preserves the balance of USPAP if a portion is contrary to law or public policy of a jurisdiction • The Standards establish the requirements for appraisal and appraisal review and the manner in which each is communicated - STANDARDS 1 and 2 establish requirements for the development and communication of a real property appraisal - STANDARDS 3 and 4 establish requirements for the development and communication of an appraisal review - STANDARDS 5 and 6 establish requirements for the development and communication of a mass appraisal - STANDARDS 7 and 8 establish requirements for the development and communication of a personal property appraisal 1A - 1 9 3 2024Page2- STANDARDS 9 and 10 establish requirements for the development and communication of business or intangible asset appraisal • There are currently no active Statements on Appraisal Standards • Comments are an integral part of USPAP and have the same weight as the component they address These extensions of the DEFINITIONS , Rules , and Standards Rules provide interpretation and establish the context and conditions for application When do USPAP Rules and Standards Apply USPAP does not establish who or which assignments must comply Neither The Appraisal Foundation nor its Appraisal Standards Board is a government entity with the power to make , judge , or enforce law An appraiser must comply with USPAP when either the service or the appraiser is required by law , regulation , or agreement with the client Individuals may also choose to comply with USPAP any time that individual is performing the service as an appraiser In order to comply with USPAP , an appraiser must meet the following obligations • An appraiser must act competently and in a manner that is independent , impartial , and objective • An appraiser must comply with the ETHICS RULE in all aspects of appraisal practice • An appraiser must maintain the data , information , and analysis necessary to support his or her opinions for appraisal and appraisal review assignments in accordance with the RECORD KEEPING RULE • An appraiser must comply with the COMPETENCY RULE and the JURISDICTIONAL EXCEPTION RULE for all assignments • When an appraiser provides and opinion of value in an assignment , the appraiser must also comply with the SCOPE OF WORK RULE , the RECORD KEEPING RULE , the applicable development and reporting Standards , and applicable Statements there are currently no active Statements • When an appraiser provides an opinion about the quality of another appraiser’s work that was performed as part of an appraisal or appraisal review assignment , the appraiser must also comply with the SCOPE OF WORK RULE , the RECORD KEEPING RULE , applicable portions of STANDARDS 3 and 4 , and applicable Statements there are currently no active Statements • When preparing an appraisal or appraisal review that is a component of a larger assignment with additional opinions , conclusions , or recommendations , the appraisal or appraisal review component must comply with the applicable development and reporting Standards and applicable Statements there are currently no active Statements , and the remaining component of the assignment must comply with the ETHICS RULE , the COMPETENCY RULE , and the JURISDICTIONAL EXCEPTION RULE The following STANDARDS are only part of the USPAP , 2024 Edition A more comprehensive understanding of USPAP is published by the Appraisal Standard Board of the The Appraisal Foundation 1A - 2 9 3 2024Page3STANDARD 5 MASS APPRAISAL , DEVELOPMENT In developing a mass appraisal , an appraiser must identify the problem to be solved , determine the scope of work necessary to solve the problem , and correctly complete research and analyses necessary to produce a credible mass appraisal Comment STANDARD 5 applies to all mass appraisals of real or personal property regardless of the purpose or use of such appraisals The reporting and jurisdictional exceptions applicable to public mass appraisals prepared for ad valorem taxation do not apply to mass appraisals prepared for other purposes A mass appraisal includes 1 identifying properties to be appraised ; 2 defining market area of consistent behavior that applies to properties ; 3 identifying characteristics supply and demand that affect the creation of value in that market area ; 4 developing a model structure that reflects the relationship among the characteristics affecting value in the market area ; 5 calibrating the model structure to determine the contribution of the individual characteristics affecting value ; 6 applying the conclusions reflected in the model to the characteristics of the property ies being appraised ; and 7 reviewing the mass appraisal results The JURISDICTIONAL EXCEPTION RULE may apply to several sections of STANDARD 5 because ad valorem tax administration is subject to various state , county , and municipal laws STANDARDS RULE 5 - 1 , GENERAL DEVELOPMENT REQUIREMENTS In developing a mass appraisal , an appraiser must a be aware of , understand , and correctly employ those recognized methods and techniques necessary to produce a credible mass appraisal ; Comment Mass appraisal provides for a systematic approach and uniform application of appraisal methods and techniques to obtain estimates of value that allow for statistical review and analysis of results This requirement recognizes that the principle of change continues to affect the manner in which appraisers perform mass appraisals Changes and developments in the real property and personal property fields have a substantial impact on the appraisal profession To keep abreast of these changes and developments , the appraisal profession is constantly reviewing and revising the appraisal methods and techniques and devising new methods and techniques to meet 1A - 3 9 3 2024Page4new circumstances For this reason it is not sufficient for appraisers to simply maintain the skills and the knowledge they possess when they become appraisers Each appraiser must continuously improve his or her skills to remain proficient in mass appraisal b not commit a substantial error of omission or commission that significantly affects a mass appraisal ; and Comment An appraiser must use sufficient care to avoid errors that would significantly affect his or her opinions and conclusions Diligence is required to identify and analyze the factors , conditions , data , and other information that would have a significant effect on the credibility of the assignment results c not render a mass appraisal in a careless or negligent manner STANDARDS RULE 5 - 2 , PROBLEM IDENTIFICATION In developing a mass appraisal , an appraiser must a identify the client and other intended users ; Comment In ad valorem mass appraisal , the assessor , or party responsible for the certification of the assessment or tax roll is required to apply the relevant law or statute and identify the clients and other intended users if any b identify the intended use of the appraisal ; Comment An appraiser must not allow the intended use of an assignment or a client’s objectives to cause the assignment results to be biased c identify the type and definition of value , and ascertain whether the value is to be the most probable price i In terms of cash ; or ii In terms of financial arrangements equivalent to cash ; or iii In such other terms as may be precisely defined ; and iv If the opinion of value is to be based on non - market financing or financing with unusual conditions or incentives , identify the terms of such financing and any influences on value ; d identify the effective date of the appraisal e identify , from sources the appraiser reasonably believes to be reliable , the characteristics of the properties that are relevant to the type and definition of value and intended use , including i the group with which a property is identified according to similar market influence ; ii the appropriate market area and time frame relative to the property being valued ; and iii their location and physical , legal , and economic characteristics ; 1A - 4 9 3 2024Page5Comment The properties must be identified in general terms , and each individual property in the universe must be identified , with the information on its identity stored or referenced in its property record When appraising proposed improvements , an appraiser must examine and have available for future examination , plans , specifications , or other documentation sufficient to identify the extent and character of the proposed improvements Ordinarily , proposed improvements are not appraised for ad valorem tax purposes Appraisers , however , are sometimes asked to provide opinions of value of proposed improvements so that developers can estimate future property tax burdens Sometimes units in condominiums and planned unit developments are sold with an interest in un - built community property , the pro rata value of which , if any , must be considered in the analysis of sales data f identify the characteristics of the market that are relevant to the purpose and intended use of the mass appraisal , including i location of the market area ; ii physical , legal , and economic characteristics ; iii time frame of market activity ; and iv property interests reflected in the market ; g in appraising real property or personal property ; i identify the appropriate market area and time frame relative to the property being valued ; ii when the subject is real property , identify and consider any personal property , trade fixtures , or intangible assets that are not real property but are included in the appraisal ; iii when the subject is personal property , identify and consider any real property or intangible assets that are not personal property but are included in the appraisal ; iv identify known easements , restrictions , encumbrances , leases , reservations , covenants , contracts , declarations , special assessments , ordinances , or other items of similar nature ; and v identify and analyze whether an appraised fractional interest , physical segment or partial holding contributes pro rata to the value of the whole ; Comment The above requirements do not obligate the appraiser to value the whole when the subject of the appraisal is a fractional interest , physical segment , or a partial holding However , if the value of the whole is not identified , the appraisal must clearly reflect that the value of the property being appraised cannot be used to develop the value opinion of the whole by mathematical extension h analyze the relevant economic conditions at the time of the valuation , including market acceptability of the property and supply , demand , scarcity , or rarity ; i identify any extraordinary assumptions necessary in the assignment An extraordinary assumption may be used in an assignment only if i the extraordinary assumption is required to properly develop credible opinions and conclusions ; 1A - 5 9 3 2024Page6ii the appraiser has a reasonable basis for the extraordinary assumption ; and iii use of the extraordinary assumption results in a credible analysis ; j identify any hypothetical conditions necessary in the assignment A hypothetical condition may be used in an assignment only if i use of the hypothetical condition is clearly required for legal purposes , for purposes of reasonable analysis , or for purposes of comparison ; and ii use of the hypothetical condition results in a credible analysis ; and k determine the scope of work necessary to produce credible results in accordance with the SCOPE OF WORK RULE STANDARDS RULE 5 - 3 , PROPERTY’S USE AND APPROPRIATE MARKET When necessary for credible assignment results , an appraiser must a in appraising real property , identify and analyze the effect on use and value of the following factors i existing land use regulations ; ii reasonably probable modifications of such regulations ; iii economic supply and demand ; iv the physical adaptability of the real estate ; v neighborhood trends ; and vi highest and best use of the real estate ; and Comment This requirement sets forth a list of factors that affect use and value In considering neighborhood trends , an appraiser must avoid stereotyped or biased assumptions relating to race , age , color , gender , or national origin or an assumption that race , ethnic , or religious homogeneity is necessary to maximize value in a neighborhood Further , an appraiser must avoid making an unsupported assumption or premise about neighborhood decline , effective age , and remaining life In considering highest and best use , an appraiser must develop the concept to the extent required for a proper solution to the appraisal problem b in appraising personal property identify and analyze the effects on use and value of industry trends , value - in - use , and trade level of personal property Where applicable , analyze the current use and alternative uses to encompass what is profitable , legal , and physically possible , as relevant to the type and definition of value and intended use of the appraisal Personal property has several measurable marketplaces ; therefore , the appraiser must define and analyze the appropriate market consistent with the type and definition of value 1A - 6 9 3 2024Page7STANDARDS RULE 5 - 4 , APPRAISAL METHODS In developing a mass appraisal , an appraiser must a identify the appropriate procedures and market information required to perform the appraisal , including all physical , functional , and external market factors as they may affect the appraisal ; Comment Such efforts customarily include the development of standardized data collection forms , procedures , and training materials that are used uniformly on the universe of properties under consideration b employ recognized techniques for specifying property valuation models ; and Comment The formal development of a model in a statement or equation is called model specification Mass appraisers must develop mathematical models that , with reasonable accuracy , represent the relationship between property value and supply and demand factors , as represented by quantitative and qualitative property characteristics The models may be specified using the cost , sales comparison , or income approaches to value The specification format may be tabular , mathematical , linear , nonlinear , or any other structure suitable for representing the observable property characteristics Appropriate approaches must be used in appraising a class of properties The concept of recognized techniques applies to both real and personal property valuation models c employ recognized techniques for calibrating mass appraisal models Comment Calibration refers to the process of analyzing sets of property and market data to determine the specific parameters of a model The table entries in a cost manual are examples of calibrated parameters , as well as the coefficients in a linear or nonlinear model Models must be calibrated using recognized techniques , including , but not limited to , multiple linear regression , nonlinear regression , and adaptive estimation STANDARDS RULE 5 - 5 , APPROACHES TO VALUE In developing a mass appraisal , when necessary for credible assignment results , an appraiser must a collect , verify , and analyze such data as are necessary and appropriate to develop i the cost new of the improvements ; ii depreciation ; iii value of the land by sales of comparable properties ; iv value of the property by sales of comparable properties ; v value by capitalization of income or potential earnings ie , rentals , expenses , interest rates , capitalization rates , and vacancy data ; Comment This Standards Rule requires appraisers engaged in mass appraisal to take reasonable steps to ensure that the quantity and quality of the factual data that are collected are sufficient to produce credible appraisals 1A - 7 9 3 2024Page8 b base estimates of capitalization rates and projections of future rental rates and or potential earnings capacity , expenses , interest rates , and vacancy rates on reasonable and appropriate evidence ; Comment This requirement calls for an appraiser , in developing income and expense statements and cash flow projections , to weigh historical information and trends , current market factors affecting such trends , and reasonably anticipated events , such as competition from developments either planned or under construction c identify and , as applicable , analyze terms and conditions of any available leases ; and d identify the need for and extent of any physical inspection STANDARDS RULE 5 - 6 , CALIBRATED MASS APPRAISAL MODEL APPLICATION When necessary for credible assignment results in applying a calibrated mass appraisal model an appraiser must a value improved parcels by recognized methods or techniques based on the cost approach , the sales comparison approach , and the income approach ; b value sites by recognized methods or techniques ; such techniques include but are not limited to the sales comparison approach , allocation method , abstraction method , capitalization of ground rent , and land residual technique ; c when developing the value of a leased fee estate or a leasehold estate , analyze the effect on value , if any , of the terms and conditions of the lease ; Comment In ad valorem taxation the appraiser may be required by rules or law to appraise the property as if in fee simple , as though unencumbered by existing leases In such cases , market rent would be used in the appraisal , ignoring the effect of the individual , actual contract rents d analyze the effect on value , if any , of the assemblage of the various parcels , divided interests , or component parts of a property ; the value of the whole must not be developed by adding together the individual values of the various parcels , divided interests , or component parts ; and Comment Although the value of the whole may be equal to the sum of the separate estates or parts , it also may be greater than or less than the sum of such estates or parts e when analyzing anticipated public or private improvements , located on or off the site , analyze the effect on value , if any , of such anticipated improvements to the extent they are reflected in market actions 1A - 8 9 3 2024Page9STANDARDS RULE 5 - 7 , RECONCILIATION In developing a mass appraisal , an appraiser must a reconcile the quality and quantity of data available and analyzed within the approaches used and the applicability and relevance of the approaches , methods , and techniques used ; and b employ recognized mass appraisal testing procedures and techniques to ensure that standards of accuracy are maintained Comment It is implicit in mass appraisal that , even when properly specified and calibrated mass appraisal models are used , some individual value conclusions will not meet standards of reasonableness , consistency , and accuracy However , appraisers engaged in mass appraisal have a professional responsibility to ensure that , on an overall basis , models produce value conclusions that meet attainable standards of accuracy This responsibility requires appraisers to evaluate the performance of models , using techniques that may include but are not limited to , goodness - of - fit statistics , and model performance statistics such as appraisal - to - sale ratio studies , evaluation of hold - out samples , or analysis of residuals STANDARD 6 MASS APPRAISAL , REPORTING In reporting the results of a mass appraisal , an appraiser must communicate each analysis , opinion , and conclusion in a manner that is not misleading Comment STANDARD 6 addresses the content and level of information required in a report that communicates the results of a mass appraisal STANDARD 6 does not dictate the form , format , or style or mass appraisal reports The substantive content of a report determines its compliance Standards Rule 6 - 1 , GENERAL REPORTING REQUIREMENTS Each written report of a mass appraisal must a clearly and accurately set forth the appraisal in a manner that will not be misleading ; b contain sufficient information to enable the intended user s of the appraisal to understand the report properly ; and Comment Documentation for a mass appraisal for ad valorem taxation may be in the form of 1 property records , 2 sales ratios and other statistical studies , 3 appraisal manuals and documentation , 4 market studies , 5 model building documentation , 6 regulations , 7 statutes , and 8 other acceptable forms c clearly and accurately disclose all assumptions , extraordinary assumptions , hypothetical conditions , and limiting conditions used in the assignment ; 1A - 9 9 3 2024Page0STANDARDS RULE 6 - 2 , CONTENT OF A MASS APPRAISAL REPORT The content of a mass appraisal report must be appropriate for the intended use of the appraisal and , at a minimum a state the identity of the client , or if the client has requested anonymity , state that the identity is withheld at the client’s request but is retained in the appraiser’s workfile ; state the identity of any intended user s by name or type ; Comment Because the client is an intended user , they must be identified in the report as such However , if the client has requested anonymity the appraiser must use care when identifying the client to avoid violations of the Confidentiality section of the ETHICS RULE b state the intended use of the appraisal c disclose any assumptions or limiting conditions that result in deviation from recognized methods and techniques or that affect analyses , opinions , and conclusions ; d state the effective date of the appraisal and the date of the report ; Comment In ad valorem taxation the effective date of the appraisal may be prescribed by law If no effective date is prescribed by law , the effective date of the appraisal , if not stated , is presumed to be contemporaneous with the data and appraisal conclusions e state the type and definition of value and cite the source of the definition ; Comment Stating the type and definition of value also requires any comments needed to clearly indicate to intended users how the definition is being applied When reporting an opinion of value , state whether the opinion is • In terms of cash or of financing terms equivalent to cash ; or • Based on non - market financing with unusual conditions or incentives When an opinion of value is based on non - market financing terms or financing with unusual conditions or incentives , summarize the terms of such financing and any influences on value f state the properties appraised including the property rights ; and , when the property rights to be appraised are specified in a statute or court ruling , reference the law ; Comment The report documents the sources for location , describing and listing the property When applicable , include references to legal descriptions , addresses , parcel identifiers , photos , and building sketches In mass appraisal , this information is often included in property records g summarize the scope of work used to develop the appraisal ; and explain the exclusion of the sales comparison approach , cost approach , or income approach ; Comment Summarizing the scope of work includes disclosure of the research and analyses performed and might also include disclosure of research and analyses not performed 1A - 10 9 3 2024Page1 h when any portion of the work involves significant mass appraisal assistance , summarize the extent of that assistance ; i summarize and support the model specification s considered , data requirements , and the model s chosen ; provide sufficient information to enable the client and intended users to have confidence that the process and procedures used conform to accepted methods and result in credible value conclusions ; and include a summary of the rationale for each model , the calibration techniques to be used , and the performance measures to be used ; Comment In the case of mass appraisal for ad valorem taxation , stability and accuracy are important to the credibility of value opinions j summarize the procedure for collecting , validating , and reporting data ; and summarize the sources of data and the data collection and validation processes ; Comment Reference to detailed data collection manuals or electronic records must be made , as appropriate , including where they may be found for inspection k summarize calibration methods considered and chosen , including the mathematical form of the final model s ; summarize how value conclusions were reviewed ; and , if necessary , state the availability and location of individual value conclusions ; l when an opinion of highest and best use , or the appropriate market or market level was developed , summarize how that opinion was determined , and reference case law , statute , or public policy that describes highest and best use requirements ; Comment When actual use is the requirement , the report must summarize how use - value opinions were developed The appraiser’s reasoning in support of the highest and best use opinion must be provided in the depth and detail required by its significance to the appraisal m identify the appraisal performance tests used and the performance measures attained ; n summarize the reconciliation performed , in accordance with Standards Rule 5 - 7 ; and o include a signed certification in accordance with Standards Rule 6 - 3 STANDARDS RULE 6 - 3 , CERTIFICATION A signed certification is an integral part of the appraisal report a The wording of a certification does not have to match the following verbatim , but each of the elements must be addressed I certify that , to the best of my knowledge and belief - The statements of fact contained in this report are true and correct - The reported analyses , opinions , and conclusions are limited only be the reported assumptions and limiting conditions , and are my personal , impartial , and unbiased professional analyses , opinions , and conclusions 1A - 11 9 3 2024Page2- I have no or the specified present or prospective interest in the property that is the subject of this report , and no or the specified personal interest with respect to the parties involved - I have performed no or the specified services , as an appraiser or in any other capacity , regarding the property that is the subject of this report within the three - year period immediately preceding the agreement to perform this assignment - I have no bias with respect to any property that is the subject of this report or to the parties involved with this assignment - My engagement in this assignment was not contingent upon developing or reporting predetermined results - My compensation for completing this assignment is not contingent upon the reporting of a predetermined value or direction in value that favors the cause of the client , the amount of the value opinion , or the attainment of a stipulated result , or the occurrence of a subsequent event directly related to the intended use of this appraisal - My analyses , opinions , and conclusions were developed , and this report has been prepared , in conformity with the Uniform Standards of Professional Appraisal Practice - I have or have not made a personal inspection of the properties that are the subject of this report If more than one person signs this certification , the certification must clearly specify which individuals did and which individuals did not make a personal inspection of the appraised property - No one provided significant mass appraisal assistance to the person signing this certification If there are exceptions , the name of each individual providing significant mass appraisal assistance must be stated Comment The above certification is not intended to disturb an elected or appointed assessor’s work plans or oaths of office b An appraiser who signs any part of the appraisal report , including a letter of transmittal , must also sign a certification Comment In an assignment that includes only assignment results developed by the real property appraiser , any appraiser who signs a certification accepts full responsibility for all elements of the certification , for the assignment results , and for the contents of the appraisal report In an assignment that includes personal property assignment results not developed by the real property appraiser s , any real property appraiser who signs a certification accepts full responsibility for the real property elements of the certification , for the real property assignment results , and for the real property contents of the appraisal report In an assignment that includes only assignment results developed by the personal property appraiser s , any appraiser who signs a certification accepts full responsibility for all elements of the certification , for the assignment results , and for the contents of the appraisal report In an assignment that includes real property assignment results not developed by the personal property appraiser s , any personal property appraiser who signs a certification accepts full responsibility for the personal property elements of the certification , for the personal property assignment results , and for the personal property contents of the appraisal report c When a signing appraiser s has relied on work done by appraisers and others who do not sign the certification , the signing appraiser is responsible for the decision to rely on their work 1A - 12 9 3 2024Page3i The signing appraiser s is required to have a reasonable basis for believing that those individuals performing the work are competent ; and ii The signing appraiser must have no reason to doubt that the work of those individuals is credible Comment Although a certification must contain the names of individuals providing significant mass appraisal assistance , it is not required that a summary of the extent of their assistance be located in a certification This disclosure may be in any part s of the report 1A - 13 9 3 2024Page4CHAPTER 2 Sales Utilization and Fair Market ValuePage5SALES UTILIZATION APPRAISER MANUAL SALES UTILIZATION AND FAIR MARKET VALUE PREFACE Sales Collection and verification is the single most important activity in the appraisers office There is no other activity necessary to the operation of the appraisers office which is as important as the meticulous and regimented collection of sales data Ultimately , all valuation approaches , regression , cost market , or income rely upon the analysis of valid , qualified sales in order to properly value a subject property 2 - 1 9 3 2024Page6SALES UTILIZATION APPRAISER MANUAL MEETING LEGISLATIVE REQUIREMENTS Decisions by legislators in recent years have mandated the assessment of real property at 100 of the fair market value These criteria have made it imperative for the property appraiser to have an accurate and supportable sales file from which the market approach can be properly implemented Regardless of how well or how accurate the data about a property may be , the data is useless without sales data against which the data may be compared The entire premise of the computerized appraisal system is that regardless of the appraisal approach used , the analysis of sales parcels is necessary in order to do the following a develop regression equations b set cost market base rates c determine depreciation schedules d determine income capitalization or discount rates Without sales , the appraiser has to depend on the Cost and Income Approach to base his decisions Sales support the Cost Approach , help to determine depreciation and obsolescence in the Cost Approach , and cap rates in the Income Approach The basic sales information is available at the Registrar of Deeds However , before a proper analysis can be made between the sales for the tax year and those of similar properties that did not sell , the sales must be checked or qualified to verify that an arms length transaction has taken place and that the source of information is correct The transaction must then be further checked to determine if all rights and benefits of property ownership were transferred and if any personal property was involved This procedure is known as SALES QUALIFICATION STEPS IN SALES QUALIFICATION Sales of some residential , but primarily agricultural , industrial and commercial properties often include personal property There are also a number of intercompany or interfamily transfers , distress sales , etc , many of which have limiting terms and conditions which affect the sales price For these reasons and others , further qualification of sales of this type through conversations with one or more of the parties involved may be necessary to determine if the sales price should be adjusted for terms , personal property , etc , or disqualified entirely 2 - 2 9 3 2024Page7SALES UTILIZATION APPRAISER MANUAL The Sales Qualification Form Sales Qualification forms are a record of the sales research performed to establish the quality of a specific sale Qualified sales are of inestimable value in establishing unit land values , base rates , depreciation schedules , and for checking the quality and degree of equalization of all work performed The first step in any sales qualification procedure is the deed qualification of all sales parcels The sales should then be further qualified as necessary with the use of a sales qualification form STEP 1 DEED QUALIFICATION OF ALL SALES This step entails examining deeds for any conditions or statements which might indicate the sale was not an arms length transaction For single family residences , this is usually all that is necessary to obtain accurate sales data Those deeds having any of the following conditions should be entered on the maintenance document with the appropriate unqualified code as listed below in Chapter 2 , Page 4 - 5 Deed Edit Sheet - Reasons for Rejection 1 Quit claim , corrective or tax deeds 2 Deed shows 600 or less in revenue stamps 3 Same family name as to grantee and grantor 4 Deeds from or to banks or loan companies 5 Deeds indicating a trade or exchange or conveying less than whole interest , ie life estates , etc 6 Deeds including livestock or personal property , ie trucks , equipment , cattle , etc 7 Multi - parcel sales unless the amount paid for each parcel is specified 8 Deeds including exchanges of real or personal property 9 Deeds to or from any of the following Administrators Clerks of Court Executors County Commissioners Guardians Counties Receivers Trustees of Internal Imp Fund Sheriffs Cities and or municipalities Masters United States of America or Federal Agencies Churches Utility Companies Lodges Educational Institutions Fraternal Institutions Benevolent Institutions STEP 2 SALES RESEARCH Additional public and private resources can be used if the appraiser deems it necessary to accurately verify the sales or property information See Page 2 - 4 and 2 - 5 for Sale Disqualification Code Form information 2 - 3 9 3 2024Page8SALES UTILIZATION APPRAISER MANUAL DEED EDIT SHEET CODE REASONS FOR REJECTION A The transaction includes the conveyance of two 2 or more parcels B Sales for which the improvements sold are not included in the tax assessment or the assessment included improvements built after the sale C Deed shows 600 or less in revenue stamps Transaction is for 3,000 or less D The date the deed was made , entered or notarized is outside the dates of the study period The study period runs from January 1 to December 31 E The transaction is between relatives or related businesses F The grantor is only conveying an undivided or fractional interest to the grantee G The deed reserves until the grantor , a life estate or some other interest H The deed reserves unto the grantor the possession of , or lease of , the property for specified period following the sale I One or both of the parties involved in the transaction is governmental , a public utility , lending institution , or a relocation firm J The deed conveys a cemetery lot or other tax - exempt property K One or both of the parties involved in the transaction is a church , school , lodge , or some other educational organization ID Internal Document M The deed indicates that the property conveyed is situated in more than one county N The transaction is for minerals , timber , etc or the rights to mine or cut same O The transaction includes the conveyance of personal property , and the value of such is not specified separate from the real property value in the deed P The transaction is the result of a forced sale or auction Q Transaction made by the use of a Contract for Deed , the agreement for which is executed and sale actually made prior to the study R The transaction involves the trade or exchange of real property RD Reference Document S The transaction is for real property , which cannot be clearly identified on the county tax records 2 - 4 9 3 2024Page9SALES UTILIZATION APPRAISER MANUAL T Outliers are qualified sales with a sales ratio below 51 or above 151 U Unqualified changes to property after sale V Multi - parcel sale of properties of equal characteristics where sales price can be divided equally among all parcels included in the sale W Septic Lot X Other An explanation must be provided when this code is used Y Determined to be a Qualified Sale when the deed is worked and needs further review by an appraiser to determine a Qualified or Unqualified Sale Z New Construction not picked up by the Tax Office when the deed was initially worked and needs to be verified as Qualified or Unqualified after new construction is assessed USE OF SALES ANALYSIS REPORTS IN THE QUALIFICATION PROCESS For counties with a large volume of sales activity , CAMA enables the property appraiser to limit sales qualification activities to those sales which show the most extreme assessed value ratios Reports can be generated based on location , improvement type , model number , etc The sales with extreme ratios can be subjected to the sales qualification procedure The parameters for those to be analyzed can be set by the property appraiser example - all ratios greater than 100 and less than 75 , etc based on requirements , available staff , etc CAMA is designed so that the property appraiser does not have to manually research files for various property types but can receive a computer printed worksheet detailing only those parcels researched based on the parameters selected location , age , improvement type , land use , etc 2 - 5 9 3 2024Page0CHAPTER 3 MappingPage1SEE COUNTY MAPPING DEPARTMENT FOR MAPPING PROCEDURES Johnston County has a separate Geographic Information System GIS Department The GIS Department should be consulted for information concerning generally accepted mapping procedures 3 - 1 9 3 2024Page2CHAPTER 4 Land Appraisal ProceduresPage3LAND APPRAISAL PROCEDURES PREFACE Land values are derived primarily by the sales comparison method It is , therefore , important that certain factors be accurately shown and considered These factors include location , size , topography , present use , highest and best use , etc The following chapter describes procedures for recording these important elements and determining land values 4 - 1 9 3 2024Page4INTRODUCTION The market or sales comparison approach is the most applicable method for the valuation of land The income approach should also be considered for properties for which sufficient sales data is not available for vacant parcels , as often happens in the downtown area and th