What is the formula for the Aggregate Ratio?

The Aggregate Ratio is a key concept in property appraisal that helps assess the accuracy of property assessments relative to actual sales prices. The correct formula involves dividing the total of sales by the total of assessments. This ratio provides a measure of how well the assessed values align with market values reflected in recent sales.

When this ratio is calculated, it offers insight into the overall performance of property assessments within a jurisdiction. A ratio greater than 1 suggests that assessments are generally low compared to market sales prices, while a ratio less than 1 indicates that assessments may be too high. Understanding this ratio is crucial for appraisers to evaluate equity and ensure fair appraisal practices.

The other options do not accurately represent the method for calculating the Aggregate Ratio. The first choice implies a calculation that doesn't align with standard practices in assessory ratios. The average of property values doesn't directly relate to assessment ratios, and using the median in relation to total sales does not capture the necessary relationship needed for the Aggregate Ratio assessment.