How the Equalization Ratio Helps You Price Your NJ Home Smarter

By William “Bill” Boswell

Bill is widely known as one of New Jersey’s most sought after real estate agents and is a sales associate of Keller Williams Prosperity Realty.

Do you think a home’s assessed value tells you how much it’s really worth? I’ve seen buyers, sellers, and even agents fall into that same trap. The truth is, in New Jersey, assessed value and actual market value often have very little to do with each other from town to town.

Plenty of buyers worry they’re overpaying if they offer more than the assessed value, while sellers often think that’s what their home should be listed for. However, the assessed value is just a number used for property taxes, and it doesn’t automatically reflect current market conditions.

If you’re trying to find out the real worth of a home, what you should be looking at is the equalization ratio. It shows how a town’s assessed value compares to the home’s actual market value. In New Jersey, if a town’s ratio is 50% and a home is assessed at $500,000, the town is actually saying it’s worth about $1 million. That’s a big gap—so if you only look at the assessed value without checking the ratio, you could be way off.

Why equalization ratios change over time. If a town recently reassessed all its homes, the equalization ratio is usually close to 100%. This means the assessed value and market value are about the same. But over time, as home prices rise, that ratio goes down. This helps towns keep taxes fair without having to reassess every home all the time.

When you’re buying or selling a home, don’t just look at the assessed value and assume anything. When you factor in the equalization ratio, you’re arming yourself with the kind of insight most people overlook. If you have more questions, just give me a call at 973-224-4605 or send an email to bill@northjerseyluxury.com. I’d be happy to help.