What distinguishes market value from assessed value?

Market value is defined as the price a property would likely sell for in a competitive and open market, which means it reflects the current demand and supply conditions. This value is determined by various factors, including location, property condition, and comparable sales.

On the other hand, the assessed value is primarily used for the purposes of property tax assessment. It is determined by local government authorities and may not accurately reflect the property's market value. Assessed value can often be a fixed percentage of the market value or based on specific criteria set by local laws.

By distinguishing market value from assessed value, we see that market value aims to capture the true economic value a buyer would pay for a property in the real estate market, while assessed value is more administrative and can be influenced by many factors that do not necessarily align with current market conditions. This fundamental difference underlines the role each value plays in real estate transactions versus taxation.