Which components make up the sales ratio?

The sales ratio is a crucial metric used in property assessment, representing the relationship between the assessed value of a property and its actual sales price. The correct components that make up the sales ratio are the assessed value and the sales price.

When assessing property values, tax assessors aim to ensure that properties are fairly and accurately valued for tax purposes. The assessed value is a percentage of a property's market value, and it is determined by local tax assessors based on various factors, including property characteristics and market trends. The sales price, on the other hand, reflects the actual price at which a property was sold in the market.

By comparing these two figures, the sales ratio provides insights into how closely assessed values align with the market, which helps identify potential disparities in property valuation. A ratio that is too high or too low may indicate that adjustments are needed to the assessed values in order to achieve equity in property taxation.

Other options include components that do not directly pertain to the calculation of the sales ratio. For instance, total sales and appraisal values focus on different aspects of property valuation and market activities rather than the relationship needed for the sales ratio. Assessed value and tax liabilities relate to tax obligations rather than the assessment-based comparison of market transactions. Lastly,