Are you seeing two different numbers for your Crestwood home and wondering which one matters? You are not alone. In Washington, DC, an appraisal and an assessment serve very different purposes, and the gap between them can be confusing when you are buying, selling, or planning for taxes. In this guide, you will learn how each value is set, why they diverge, and the exact steps to take so you can protect your deal and your bottom line. Let’s dive in.
Appraisal vs assessment at a glance
Appraisals and assessments answer different questions.
- Appraisal: What is this property worth today in the open market? A licensed or certified appraiser delivers a written opinion that follows professional standards.
- Assessment: What value will DC use to calculate your property taxes? The DC Office of Tax and Revenue sets an assessed value through a mass process.
Key differences you should know:
- Purpose and user
- Appraisal: Used for transactions, refinancing, and legal matters. Lenders rely on it for underwriting. You or your lender order it.
- Assessment: Used by DC to determine property taxes. You do not order it, but you receive the notice and pay taxes based on it.
- Method
- Appraisal: Property-specific analysis that weighs recent comparable sales, condition, and upgrades. Appraisers must follow the Uniform Standards of Professional Appraisal Practice, or USPAP. You can read more about these standards through The Appraisal Foundation.
- Assessment: Mass appraisal that applies statistical models across many parcels using sales data and property records.
- Timing
- Appraisal: A point-in-time opinion tied to the inspection date or another stated effective date.
- Assessment: Set on a cycle that may reference an earlier valuation date.
- Impact
- Appraisal: A low result can delay, renegotiate, or cancel a financed purchase.
- Assessment: A high result increases your tax bill. You can appeal through the District.
For DC assessment rules, procedures, and deadlines, start with the DC Office of Tax and Revenue.
How appraisals work in DC
An appraisal is a written, professional opinion of value prepared by a District-licensed or certified appraiser who follows USPAP. For single-family homes, the sales comparison approach is most common. The appraiser selects recent, comparable sales and adjusts for differences like lot size, interior finishes, and additions.
Other methods can apply:
- Cost approach: Often used for new or highly unique homes, it estimates the replacement cost minus depreciation.
- Income approach: Used for income-producing properties to value the stream of income.
If you are getting a mortgage, the lender orders the appraisal and applies investor rules. Federal programs and investors publish guidance on appraisal practice and underwriting. You can review lender-related context through HUD and Freddie Mac.
What this means for your transaction:
- The effective date matters. Market shifts before or after that date will not be reflected.
- Interior condition and permitted improvements carry real weight. Appraisers account for a finished basement, a renovated kitchen, or an addition when supported by comps.
- A low appraisal can trigger renegotiation. Buyers may ask sellers to reduce price, or buyers can add cash to bridge the gap if contract terms allow.
How DC assessments work for property taxes
An assessment is DC’s official taxable value for your property. The Office of Tax and Revenue uses a mass appraisal process that relies on sales data, property characteristics on file, and neighborhood-level modeling. It is designed for fairness across the tax base, not to mirror the exact price of your specific home on a specific day.
Important points:
- Assessments follow a set cycle. The effective valuation date can be months earlier than your closing or appraisal date.
- Mass models can lag market changes or smooth values across nearby areas. This can lead to differences from your current contract price.
- Administrative rules govern notices, exemptions, and appeals. For programs, tax rates, and timelines, use the DC Office of Tax and Revenue.
Crestwood factors that influence values
Crestwood is a small, primarily residential neighborhood in Northwest DC with many single-family homes. Because turnover is relatively low, the pool of recent comparable sales can be thin at any given time. Both appraisers and the city’s models may reach back further or cast a wider radius when selecting comps.
Elements that often affect value in Crestwood:
- Lot size and topography
- Quality and recency of renovations
- Finished lower levels and permitted additions
- Access to parks and general neighborhood amenities
In a tight-comp market, a personalized appraisal can diverge from an assessed value that relies on broader patterns. Renovations that are new to the market, or unique property features, can widen that gap.
When the numbers diverge and what to do
You may see three numbers: assessed value, appraised value, and contract price. It is normal for them to differ. Here is how to respond in common scenarios.
Appraisal lower than contract price
- If you are financing, most lenders will not lend above the appraised value. Options include renegotiating the price, adding cash to cover the gap, or cancelling under an appraisal contingency if your contract allows it.
- Ask your agent to review comps and the appraiser’s adjustments. In rare cases, a reconsideration of value may be possible with stronger comparable sales.
Assessment higher than expected
- A higher assessed value increases your tax bill. Compare the notice to recent sales and to your property record. If it seems out of line, consider an appeal.
- Weigh the cost of evidence, such as a private appraisal, against potential long-term tax savings.
Recent renovation not fully reflected
- Appraisals tend to capture new improvements when supported by relevant comps.
- Assessments may take longer to reflect improvements and may rely on permits and model updates.
How to appeal a DC assessment
If you disagree with your DC property assessment, you have a defined path:
- Review your assessment notice and the property record. Confirm lot size, building data, and any sales the city considered.
- Request an informal review or clarification from OTR. This can help correct factual errors.
- If still unresolved, file a formal appeal by OTR deadlines. Strong supporting evidence includes comparable sales and a recent, independent appraisal by a licensed professional.
- If needed, proceed to the designated administrative hearing body or further appeal channels as directed by OTR.
Appeal rules, forms, and dates change over time. Always verify the latest steps on the DC Office of Tax and Revenue.
A recent appraisal can be persuasive evidence in an appeal. It provides a dated, professional opinion that explains how your home differs from the mass appraisal model. Balance the cost of the appraisal with the potential savings across future tax years.
Smart checklists for Crestwood buyers and sellers
Use these quick references to plan ahead and reduce stress.
Buyers: before and after contract
Before you write an offer
- Review the assessed value and recent tax bills for the property through DC resources.
- Ask your agent for similar Crestwood sales and current market context. Note that small sample sizes may affect pricing.
- Include an appraisal contingency if you plan to finance. Understand the deadline and what happens if value comes in low.
After you go under contract
- If the appraisal is low, consider your options: price renegotiation, adding cash, a possible reconsideration, or cancelling if your contingency allows.
- Compare the appraisal to the assessed value. The difference does not change your current tax bill right away but can signal market momentum.
Estimate your taxes
- Use the assessed value multiplied by the current DC rate to estimate annual property taxes. Check OTR for possible deductions and credits.
Sellers: prepare to list with confidence
- Consider a pre-listing valuation or private appraisal to set a sharp price and anticipate an appraisal gap.
- Review your assessed value and tax history. If it seems out of line before listing, consider whether a timely appeal makes sense.
- Gather documentation for improvements and permits. Both appraisers and OTR reference permit records, and solid documentation can reduce valuation gaps.
For both buyers and sellers
- Work with local professionals who know Crestwood’s nuances and can source the most relevant comps.
- Build an evidence file that includes recent comparable sales, photos, permits, and, when appropriate, a current appraisal.
- Check OTR regularly for current tax rates, exemptions, and deadlines.
Key resources
- Learn about property tax assessments, exemptions, rates, and appeals through the DC Office of Tax and Revenue.
- Understand professional standards for appraisals through The Appraisal Foundation.
- For lender appraisal context, review HUD and Freddie Mac.
The bottom line for Crestwood
An appraisal is a property-specific opinion of market value that can shape your deal terms. An assessment is DC’s taxable value that drives your property tax bill. In Crestwood, where sales can be limited and homes are often unique, it is common to see a gap between the two. With the right plan, you can navigate both with confidence.
If you want step-by-step guidance tailored to your home or purchase, connect with Chena Bolton to request a personalized market consultation.
FAQs
What is the difference between a DC appraisal and assessment?
- An appraisal is a licensed professional’s opinion of market value for a specific date, while an assessment is DC’s taxable value determined through a mass appraisal process.
How can a low appraisal affect my financed Crestwood purchase?
- Most lenders will not lend above the appraised value, so you may renegotiate, add cash to cover a gap, or cancel the contract if your appraisal contingency allows.
Can a private appraisal help reduce my DC property taxes?
- Yes, a recent appraisal by a licensed appraiser can be strong evidence in a formal assessment appeal, though you should weigh the cost against potential tax savings.
Where do I find my assessed value and appeal steps in DC?
- Use the DC Office of Tax and Revenue for assessed values, tax programs, and current appeal procedures.
Why does my assessed value differ from my contract price?
- Assessments rely on mass models and set valuation dates that can lag market changes, while a contract price reflects current market conditions and negotiations.
