CONDOMINIUMS
THE RELATIONSHIP BETWEEN DUES,
PROPERTY TAXES AND VALUE
Both dues and taxes are determined basically from a percentage that is determined when the condo was built. The condos at that time were given a value based on square footage, location of the unit within the complex (top floor and end units have more value) and possible view. The total value of the condo was determined and then each unit was assigned a percentage. The total dues needed for a given year are now determined and then multiplied by the percentage of ownership for that individual condo. Hence the homeowner dues. Note the below example:
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ORIGINAL DETERMINATION OF DUES |
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| UNIT | Floor | Adjustment | Square Footage | Adjustment | Total Adjustments | Base Price | Adjusted Price | % OF TOTAL | Annual Dues |
| 1 | Top End | +5000 | 1000 | $15,000 | $20,000 | $100,000 | $120,000 | 18.3 | 1,830 |
| 2 | Middle End | +1000 | 1000 | 15,000 | 16,000 | 100,000 | 116,000 | 17.7 | 1,770 |
| 3 | Bottom End | +2000 | 1000 | 15,000 | 17,000 | 100,000 | 117,000 | 17.9 | 1,790 |
| 4 | Top | +3000 | 800 | 0 | 3,000 | 100,000 | 103,000 | 15.7 | 1,570 |
| 5 | Middle | -1000 | 800 | 0 | -1,000 | 100,000 | 99,000 | 15.1 | 1,510 |
| 6 | Bottom | 0 | 800 | 0 | 0 | 100,000 | 100,000 | 15.3 | 1,530 |
| TOTAL | $655,000 | 100% | $10,000 | ||||||
The assessor will use the percentage of value as determined by the builder as a basis for assessed value. Taxes in future years could be adjusted for condition but the assessor wouldn't normally take the time to do that type of fine tuning. Both the homeowner dues and the taxes (if they are current year numbers) are helpful in determining the difference in value from one unit to another, at least as it was assessed when new. They can not be used scientifically because the original determination of value based on the location of the unit within the complex could have been flawed. Below is an example of how a unit (Subject) could be valued using annual taxes. This is one approach that can be used with condominiums. The market value approach is the most accurate approach but this will many times be close.
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DETERMINATION OF CURRENT VALUE |
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| Unit | Sales Price | Condition Adjustment | Preliminary Adjustment | Taxes | Tax/ Sales Price |
| A | 133,000 | +2000 | 135,000 | 2025 | 1.50% |
| B | 125,000 | 0 | 125,000 | 1950 | 1.56% |
| C | 112,000 | -2000 | 110,000 | 1600 | 1.45% |
| D | 140,000 | 0 | 140,000 | 2000 | 1.43% |
| E | 115,000 | 0 | 115,000 | 1775 | 1.54% |
| Average | 1.5% | ||||
| Subject | $116,536 | +3000 | $113,536 | 1700 | 1.5% |
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