Want to save a little cash on your tax bill? A new Seattle Internet startup by the name of ValueAppeal believes it has devised a mathematical formula to determine whether homeowners are paying too much in property taxes.
Better yet -- especially for you penny pinchers in the audience -- ValueAppeal creates a customized report that homeowners can print off and then send to the assessor's office in an effort to reduce their property taxes. If successful, that can save hundreds or thousands of dollars each year.
"The property tax appeal process is just a mess," said Charlie Walsh, the 31-year-old founder of ValueAppeal. "It is totally opaque and homeowners are at a total disadvantage when it comes to finding the information they need."
An Eastlake condo owner who has never before filed a property tax appeal, Walsh said he became interested in the problem after talking to several people about their frustrations trying to figure out why their home was assessed at a certain value.
After some of those conversations, the idea just kept building in Walsh's head to the point where he couldn't sleep at night.
"I knew that if I didn't do it, I was going to regret it," said Walsh, who created the company in February and has bootstrapped it with about $100,000 from friends and family members.
ValueAppeal is relatively simple to use. Plug in your address, and within a few seconds the algorithm spits out a report telling you whether you are eligible to appeal.
In my case, ValueAppeal estimates $949 in tax savings if I appealed.
The company charges $99 to create an appeal document, which includes a list of comparable properties that are supposed to reflect the true value of the home. (Eventually, it will allow homeowners to include photos of damaged roofs, foundations or floors, which also could lower the assessed value.)
Of course, there's no guarantee that the appeal board will lower the assessment. But Walsh is so confident in the accuracy of the algorithm that he's promised to return the $99 fee if the appeal is unsuccessful.
The site has no advertising, and Walsh said it is unlikely they will head down that path. Other revenue sources are emerging. For example, he's considering adding a service where homeowners could pay a fee to have a representative go to the appeal board meetings on their behalf.
There's also been some interest from real estate professionals who handle tax assessment appeals who have wanted to subscribe to the service.
ValueAppeal's timing -- which is officially launching next week -- is impeccable.
If you're a condo or homeowner in King County, you've either already received or soon will receive a letter in the mail from the county assessor's office with a new home appraisal. That appraisal will be used to calculate the tax bill due next year.
Given the wild fluctuations in the housing market over the past 18 months, appraisals have come down in some neighborhoods. But Walsh said in many cases they haven't fallen enough, creating an opportunity for homeowners to appeal.
"What we've seen so far is the assessed values have tended to remain high, while the market value has gone down, which means there are a lot of angry homeowners out there," he said.
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