Understanding Pennsylvania’s Common Level Ratio can help you find out
Whether they have a commercial or residential property, most property owners know that market value and assessed value are not the same. Market value represents a property’s potential selling price. Assessed value is used primarily for tax purposes, impacting the amount in property tax to be paid.
Unfortunately not many owners regularly check in on these numbers. Tax bills get paid without any, or little, research into how they are calculated. Subsequently there is the potential that property owners are over paying these tax bills.
If you own property in Pennsylvania, there’s a smart way to check if you’re overpaying PA property taxes. It involves something called the Common Level Ratio, or CLR.
What Is The Common Level Ratio?
The CLR is a ratio set annually by the Pennsylvania State Tax Equalization Board (STEB) that reflects the relationship between the assessed value and current market value of properties. Each county gets its own CLR. It is important because it plays a key role in calculating real estate assessments during the tax appeal process.
The CLR is determined every year and issued in July. Keep in mind that it is not automatically applied – meaning a lower CLR will not automatically reduce property taxes. A property tax assessment appeal needs to be initiated in order for things to change.
In addition, since the CLR is set county by county, it represents a county average. The ratio does not take into account the specific location of the real estate or market conditions that may have an impact on the location.
How To Check If You’re Overpaying Your PA Property Taxes
If you think you may be a candidate for a potential reduction in property taxes, here’s an exercise to do.
Step 1: Find the assessed value of your property (your tax bill is a good place to look).
Step 2: Find your county’s current CLR. The CLR is determined annually and published in July. For July 1, 2025 through June 30, 2026 the CLR for every county in the state can be found here.
Step 3: Multiple the assessed value by the CLR. This will provide you the “perceived market value” or what the county thinks your property is worth.
Step 4: Get the actual market value of the property. Turn to a real estate professional familiar with your market for this information.
Step 5: Compare the two numbers.
If the actual market value is lower than the perceived value, you could be a good candidate for an assessment appeal. If the actual market value is higher, then appealing your assessment could backfire and increase your property taxes.
Make This An Annual Strategy
Smart property owners check these numbers every year. Markets change, and sometimes assessments don’t keep up. A few minutes of research could save hundreds or thousands of dollars in property taxes.
Ready To Take Action?
Navigating the tax appeal process can be complex, but the potential savings make it very worthwhile. We have the knowledge and experience to guide you. Contact us today.
