Appraiser’s Lack of Support for Adjustments Once Again Dooms Taxpayer’s Appeal

Despite presenting an expert witness at trial, another taxpayer failed to convince the NewJersey Tax Court that its property was over assessed.  In Arteaga v. Wyckoff, the taxpayer challenged the original assessments of a single-family home for tax years 2012, 2013, and 2015.  Wyckoff underwent a revaluation for tax year 2015.  The taxpayer filed appeals to the Bergen County Tax Board and received reductions for each respective year.  Nonetheless, the taxpayer sought further review from the Tax Court believing perhaps that a larger reduction was warranted.

At trial, the taxpayer presented a real estate appraiser as its expert witness.  Relying on the sales approach to valuation, taxpayer’s expert chose comparable home sales in Wyckoff for each respective tax year and made adjustments to them accordingly.  The expert made adjustments to each sale to account for such differences such as location, site size, condition, gross living area, finished basement, garage, etc.  The expert, however, failed to substantiate any of the adjustments with market data or factual evidence.

The Tax Court has repeatedly handed down decisions dismissing taxpayer complaints for lack of factual, statistical, and analytical support for the adjustments made by appraisers.  We have summarized many of these prior cases on our blogs and reiterated the importance of an appraiser’s need to support their adjustments with market data and/or other form of factual evidence (Taxpayer Foiled Despite Overcoming Presumption of Validity; Tax Court Prefers Quantitative, Not Qualitative Adjustments; Appraiser’s Subjective Adjustments Rejected, Owner Loses Appeal).

The decision handed down recently in Arteaga is yet again another reminder of how easily an expert’s testimony can be discredited given the Tax Court’s close scrutiny of experts.  The Tax Court’s line of cases following the legal precedent set forth most recently in Greenblatt v. Englewood appears to be consistent and unwavering.  See Greenblatt v. Englewood (26 N.J. Tax 41, 55 (Tax Ct. 2011) (appraiser’s adjustments “must have foundation obtained from the market and, where appropriate, supported by cost manuals”).

A copy of the Tax Court’s opinion in Arteaga v. Wyckoff is available here.