The first time I went in with 28 pages of documentation to support my claim that the assessed value of one of my rentals was way too high relative to the assessed values of nearby rentals. The judge said she didn't have time to look at all that and denied my claim.
I had spent several hours preparing to demonstrate that my house wasn't worth the assessed value based on the gross rent multipliers and capitalization rates of nearby comparable rentals. She clearly had no idea what I was talking about, and told me my presentation was meaningless to her because I identified the comparable rentals in my analysis by street address, rather than parcel numbers.
The county appraiser gave me his spreadsheet showing the parcel numbers of the comparable properties he used in his analysis of my rental property's value. It was my job to look up the addresses on my own time, so I had no way to challenge his approach. His spreadsheet had many columns of numbers, with incomprehensible abbreviations in the column headers and no key to explain what it was all about.
Note to self: if I ever go to another assessment hearing, have a one page spreadsheet showing addresses and parcel numbers of the comparable properties, plus a map of the properties showing their proximity to my property. Anything else will be ignored. Forget trying to establish value based on return on investment. The judge has no interest in the only thing that an investor should consider when deciding what a property is worth.
I almost went to another hearing tomorrow, but thanks to a long phone conversation today with a very knowledgeable and helpful member of the county assessor appraisal staff, I got my questions answered and cancelled my hearing.
Here is what I learned today:
The full cash value (FCV) is reevaluated every year based on nearby sales of similar properties. A computer does the preliminary evaluation, and then the county appraiser looks at the parcels and discards outlier sale prices and sales that are not similar in age or condition to the subject property. The county appraiser who explained this to me used to be a real estate agent, and she said that when she sold houses, "everyone" thought FCV was 72% of market value. Many sellers have told me with confidence that FCV is 80% of market value. When she started working for Pima County, she was told it was no such thing. FCV is supposed to be market value, but it is usually a little less.