Step 1: Adjust the income and expenses reported by the property being valued
-
We adjust a property’s reported income and expenses in a variety of ways to capture market conditions. We also strive to protect property owners from spikes or sharp decreases in value based on one year’s data. Below are a few adjustments:
-
Trending: We project a property’s income and expense to the taxable status date (January 5th) from data filed in the previous year and reported for the year before that. So for tax year 2015-2016, which had a taxable status date of January 5, 2015, RPIEs were filed by owners in 2014 and owners reported data for 2013.
-
Addbacks for vacancies and owner occupancy: We add on income for vacancy levels in a property beyond what is typical and for owner-occupied portions of a property that don’t generate income but potentially could.
-
Lease termination income: We cap the percentage of income for payments for leases being terminated by renters.
-