Contact Information

Contact Information

City Assessor's Office


Market Value


Defining Market Value

Minnesota Statute 272.03 defines "Market Value" as "the usual selling price … at the time of assessment". It is the most probable price that a property should sell for in a competitive and open market under all conditions requisite to a fair sale. It is assumed the buyer and seller are each acting prudently and knowledgeably, and it is assumed the price is not affected by undue stimulus.

Why is a market value established for my property?

Market value is one of the three main components used in determining property taxes:

  • The market value established for your property determines your fair share of the total property tax burden, regardless of what the total tax burden is.
  • Minnesota state law determines how the total tax will be distributed among the various types of property in the state, such as apartment, commercial and industrial, and residential property.
  • The amount of money that is needed to fund local services determines the actual dollar amount of property tax you will pay.
  • Of course, the actual calculation of your property tax is a little more complicated. Changes in the city’s property tax base, special property classifications, state mandates, and other statutory requirements, like fiscal disparities and tax increment financing will affect the actual dollar amount of property tax that you pay.

How am I notified about my market value and property class?

In late February or early March of each year, the City of Bloomington Assessor's office sends you a notice.

Determining Market Value

Market value for property tax purposes is the likely price a property would sell for on the open market. Market value is defined in Minnesota Statute 272.03, subd 8.

Assessors must estimate the market value of each property in the county as of every January 2.

State law requires that the value and classification of real estate be established as of January 2 each year. The City of Bloomington Assessor's Office works throughout the year to estimate the market value of each property for the following January 2.

To determine the market value, Assessing does the following:

View property

Every property in the city is visited and reviewed in person at least once every five years during a quintile review required by state statute. In addition, properties that have been issued a building permit will be reviewed during the year and it's new construction value will be calculated and added to the following January 2 assessment. This requirement was adjusted due to the Covid pandemic. Appraisers are allowed to review properties virtually with owners. We still may request an interior inspection if concerns arise.  

Gather data

Appraisers collect all items on property that have an impact on market value, such as size, age, quality, condition, basement finish, bathrooms, and extra features such as fireplaces, walkouts, etc. Land characteristics and size are also gathered.

Compute value

This property information is entered into a computerized mass appraisal system, which aids the assessor in establishing market value. Sales information is also collected each year. Sales information is used to update the rates that are used to compute market value. The result is an estimated market value for each parcel of taxable property in the city. The estimated market value established for your property should be close to its probable selling price if placed on the open market.

Analyze sales

Each year, the assessor studies actual sales of property in the community. Sales in a 12-month time period before the January 2 assessment date (from October 1 to September 30) are reviewed to find out what properties have sold for on the open market.

The State Board of Equalization requires the overall "level of assessment" to be between 90 and 105 percent of market value. The City of Bloomington consistently meets the State Board’s requirement.

Factors in how much your home is worth

  1. There is a lag between the time of the assessment and when the sale takes place.
    An appraisal is an estimate of property value based on historical data at a set point in time – January 2 of each year – and the market can change dramatically by the time the property is sold.

    For example, consider a property valued at $380,000 as of January 2, 2021. This assessment is based on home sales that occurred between October 2019 and September 2020. However, the property may sell for $410,000 in August 2020. Does this mean the estimated value is incorrect? Not necessarily. It could signal an upturn in the housing market between September 2019 and August 2020, raising the sale price of the home.

    Just as buyers in rapidly accelerating markets may pay significantly more than the assessor’s last valuation, they may also pay less in declining markets. A property valued by the assessor at $355,000 for the 2021 assessment may sell for $325,000 in August 2021.

    This lag time often results in a dramatic difference between actual sale prices and the estimated market values for the current year.
  2. Properties can change over time.
    While values can fluctuate on an annual basis due to sales of similar properties, Minnesota law requires that properties only be inspected once every five years, unless new construction or demolition takes place. Between those inspections, properties may be improved without the owner obtaining a building permit – or they may deteriorate if neglected. These changes can be difficult for assessors, who may only see the exterior of the home, to consider in their annual evaluations.
  3. There is no "correct" price for real estate – but rather a range of prices.
    The ultimate sale price of a particular property depends on its unique characteristics as well as the complex motivations and preferences of the seller and potential buyers. If that were not the case, Realtors and sellers would never have to reduce listing prices, offers from multiple buyers would all be identical, and professional appraisals would all arrive at the same value. In reality, list prices often misjudge the market, offers are negotiable and can vary widely, and appraised values may be disputed.
  4. No two parcels of property are identical.
    Estimating the precise value of a property that is based on dozens, if not hundreds, of characteristics is very difficult. Even nearly identical properties (e.g. adjacent townhomes or condominiums) often sell for different amounts.
  5. Real estate markets are highly localized and always changing.
    Sale prices of different types of properties can vary widely. For example, farmland and recreational properties could be rising in value, but residential sales could be stable or slightly declining in several areas. Some neighborhoods could be declining at a much faster rate than other areas, which may be stable or slightly increasing in value.
  6. Fewer sales mean more challenges for assessors.
    n many markets and for many types of property, there are few sales of comparable properties. This can make accurate market assessments more difficult, but the assessor must still use his/her professional judgment and knowledge to estimate market values on an annual basis. This may mean looking at sales that take place outside the study time frame or in a neighboring city or township.
  7. Not all sales are representative of the market.
    Some sales, such as foreclosures, sales between relatives, or sales where the seller or buyer are acting under undue duress are not considered open-market, arm’s-length transactions and are not used in sales ratio studies, nor are they used as comparables in estimating the market values of similar properties.