What does the appraisal-assessment ratio measure?

The appraisal-assessment ratio is a critical measure used to assess the relationship between the appraised value of a property (its assessed value) and its market value. Specifically, this ratio provides insight into how closely the assessed value, which is derived through the appraisal process, aligns with the market value that a property would command in a competitive selling environment.

When appraisers and assessors analyze the appraisal-assessment ratio, they often use this information to ensure equity in property taxation and to evaluate the effectiveness of the assessment process. A higher ratio would typically indicate that assessed values are closer to market values, suggesting that the assessment reflects the true economic value of properties.

In this context, the other answer choices do not accurately define what the appraisal-assessment ratio measures. The first option refers to the difference rather than the ratio, making it less relevant. The third choice discusses property sales compared to market value, which does not directly relate to the assessment of property values. The last option pertains more to the costs associated with property assessment rather than the value measure itself. Therefore, the correct interpretation of the appraisal-assessment ratio being the relationship between appraisal and market value underscores its importance in the field of property assessment.