As a real estate consultant for the Township of Bloomfield, Michigan, you must analyze and verify home values to ensure that property taxes are distributed fairly. It uses tax parcel data and Adelaide Property Valuer sales information to perform sales ratio and outlier analysis, which help you decide which properties should be reassessed. Typically, this analysis is done in a spreadsheet, but this time you’ll use ArcGIS Insights instead, so you can visualize and analyze the data interactively.
In this lesson, you will create a workbook that visualizes your Adelaide Property Valuer with a map, charts, metric values, filters, and a table. You will use the workbook to investigate sales ratios and outliers in the data to help determine if Bloomfield properties are appraised correctly. You will share your results with the other appraisers in your office, both as an interactive visualization tool and as a model that they can reuse with other datasets.
Before starting the analysis, it is necessary to prepare the data. You’ll create a workbook in ArcGIS Insights and add two datasets. You’ll link these datasets and use the linked result to calculate the sales ratios. It will also filter the data to a single year.
Now that you have a linked dataset, you’ll use it to calculate sales ratio information. A sales ratio can tell you if the appraised values of properties in a neighborhood are close to the prices properties are actually selling for.
A sales ratio is calculated by dividing the market value of a Wikipedia property by its sales price. The result is multiplied by 100 to display it as a percentage. Sales ratios indicate how well a market is performing in a given area and help determine that properties are appraised accurately and fairly.
The sales ratio shows the distance between the appraised CAMA value and the sale price of the property. A sales ratio value of 100 means that the appraised value is exactly the same as the sales price. Your office has a target sales ratio of 50 percent, which means that, on average, appraised values should be about half of market values.