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Anoka County <br />City of Lino Lakes <br />We are aware that due to the time frames we are required to work within, it sometimes <br />appears as though the assessor's estimated market value does not represent the market. It <br />seems lower than it should be during times of inflation and higher than it should be in times of <br />deflation. The following chart illustrates the relationship between assessed values and actual <br />sale prices; and how the assessor's market values have been following the changes as they <br />occur in the open market. <br />Note: The Median Assessors Estimated Market Value represents the homes that are in the sales study. <br />$235,000 <br />$230,000 <br />$225,000 <br />$220,000 <br />$215,000 <br />$210,000 <br />$205,000 <br />$200,000 <br />$195,000 <br />$190,000 <br />$185,000 <br />$180,000 <br />$175,000 <br />Median Assessed Value as it Relates to Median Sale Price <br />2004 2005 2006 2007 2008 2009 2010 2011 2012 <br />4- Tax PayableYear -� <br />-9- Median Sale Price -e- Median Assessor's Estimated Market Value <br />As you can see, there is a point in time where the relationship between the assessor's values <br />and the sales prices intersect. It is at that point in time that the market took a large downward <br />turn. The following year, in response to that market condition, the assessor's values were <br />reduced to reflect that trend. And we have responded by adjusting assessed values each <br />year based on the prior year trends. It's interesting to note the upward shift for the 2012 <br />assessment. It is somewhat deceiving in that the trend in sales prices was actually down, but <br />due to the segment of the market with the most arm's - length transactions, the median sale <br />price did go up. <br />One last important point to make note of is that the assessment process is completed before <br />the budgeting process begins. Assessors do not adjust values in order to increase revenue. <br />There is little correlation between changes in assessments due to market changes and how <br />the resulting real estate tax changes. When we adjust assessments due to market <br />conditions, all properties are adjusted. The only time that an adjustment in an assessor's <br />estimated market value will have an impact on the increase or decrease in tax is if the <br />change in value is due to value added for new construction or value removed due to <br />demolition /destruction of an improvement. <br />5 <br />