What are some of the criteria that an assessor must consider when determining fair market value of real property?

When determining the fair market value of real property, zoning and use restrictions are critical criteria for an assessor to consider. Zoning regulations dictate how a property can be used, whether it is for residential, commercial, industrial, or agricultural purposes, and can significantly affect its value. These restrictions can limit the potential uses of the property, influencing both current and future buyers. For instance, a property zoned for commercial use in a rapidly developing area may command a higher fair market value than similar properties designated for residential use, reflecting the potential for income generation.

Understanding the implications of zoning also helps assessors evaluate the highest and best use of the property, which is essential when estimating its value. Variances, overlays, and other zoning considerations must be factored into an appraisal to ensure an accurate assessment of the property’s market value. Other options, while they may play a role in the overall context, do not directly impact the immediate valuation criteria as zoning does.