Methodology
How PropGap Calculates Your Assessment Gap
Every number PropGap produces can be verified by hand using public statutes and public data. We disclose every formula, every input, and every data source — nothing is a black box.
Where the Data Comes From
Comparable Sales — RentCast (Licensed MLS Data)
Comparable sale prices come from RentCast, which aggregates licensed Multiple Listing Service (MLS) transaction records and public deed recordings. These are the same underlying transactions that appear in county deed searches — typically with a 30-90 day lag from deed recording date to database availability. Each comp address, sale price, and sale date can be independently verified against the relevant county assessor or deed record portal using the “Verify” links shown in every PropGap Pro analysis.
NJ Equalization Ratios — NJ Division of Taxation
New Jersey equalization ratios are published annually by the NJ Division of Taxation in the Table of Equalized Valuations. PropGap uses the ratios for the current appeal year, verified each March. Source: njtaxation.org/property-taxation/equalization
Tax Rates — State Comptroller / Lincoln Institute
State effective tax rates used to estimate annual savings are statewide averages from the Lincoln Institute of Land Policy and state comptroller data (2026). These are estimates — actual municipal rates vary. PropGap always discloses the rate used and instructs professionals to verify against the client's actual tax bill.
Chapter 123 Common Level Range
New Jersey's Chapter 123 law (N.J.S.A. 54:51A-6) is the foundation of residential property tax appeals in the state. It establishes a “Common Level Range” — if your assessed value exceeds the upper bound of that range, the County Board is required by statute to reduce it. PropGap applies this formula exactly as the courts do.
The Formula
Step 1. medianCompMV = median(comparable sale prices)
Step 2. fairAV = medianCompMV × equalizationRatio
Step 3. clrUpper = fairAV × 1.15
Step 4. overAssessment = max(0, assessedValue − clrUpper)
Step 5. taxGap = overAssessment × effectiveTaxRate
equalizationRatio — The municipality's Chapter 123 equalization ratio, published annually by the NJ Division of Taxation. This reflects the ratio of aggregate assessed values to aggregate market values for the municipality. A ratio of 0.87 means the municipality assesses at 87% of market value on average.
The 15% band (±15%) — Chapter 123 allows a 15% tolerance above and below the Common Level. Only assessments exceeding the Upper Bound trigger a mandatory statutory reduction. PropGap only flags properties that exceed clrUpper — not properties that are merely above fairAV.
Comparable selection — Comps are filtered to the same municipality (cross-municipality comps are inadmissible in NJ), sorted by recency, and filtered for minimum data quality (sale date within 5 years, square footage present). 3σ outlier removal on price/sqft is applied when 4+ comps are available. The most recent 3-year pool is preferred; the 5-year pool is used as a fallback.
Statutory Citations
N.J.S.A. 54:51A-6 — Chapter 123 Common Level Range
N.J.A.C. 18:12A-1.14 — Equalization ratios, Table of Equalized Valuations
N.J.S.A. 54:51A-1 — County Board of Taxation jurisdiction
§41.43 Equal and Uniform — Market Value
Texas Tax Code §41.43 requires that if a taxpayer presents evidence of the median appraised value of comparable properties, the ARB shall determine the property's value at that median if it exceeds the district's appraised value. PropGap's TX analysis applies this standard directly.
The Formula
Step 1. medianCompMV = median(comparable sale prices)
Step 2. overAppraisal = max(0, appraisedValue − medianCompMV)
Step 3. taxGap = overAppraisal × effectiveTaxRate
No equalization ratio — Texas appraises at 100% of market value (TX Tax Code §23.01). No ratio adjustment is applied. The comp median is compared directly to the CAD's appraised value.
ARB evidence standard — Under §41.43(b-1), the taxpayer must present a minimum number of comparable properties with similar characteristics. PropGap uses up to 10 comparables filtered for recency, size, and location consistency.
Statutory Citations
TX Tax Code §41.43 — Equal and Uniform Appraisal / Comparable Evidence
TX Tax Code §23.01 — Market Value Standard (100% of market value)
TX Tax Code §41.01 — ARB jurisdiction and authority
PTAD Rule 9.3043 — Acceptable comparable sale criteria
Cook County 10% Assessment Ratio
Illinois law requires Cook County to assess residential properties at 10% of market value (35 ILCS 200/9-145). A state equalization multiplier (published annually by IDOR) is then applied to produce the Equalized Assessed Value (EAV) upon which the tax rate is levied. PropGap's appeal analysis focuses on the assessed value vs. the 10% statutory standard.
The Formula
Step 1. medianCompMV = median(comparable sale prices)
Step 2. fairAV = medianCompMV × 0.10
Step 3. overAssessment = max(0, assessedValue − fairAV)
Step 4. taxGap = overAssessment × (taxRate × IDORMultiplier)
Statutory Citations
35 ILCS 200/9-145 — Cook County residential assessment ratio (10%)
35 ILCS 200/16-185 — Certificate of Error and Assessment Complaint
35 ILCS 200/9-210 — State equalization factor (IDOR multiplier)
Comparable Quality Pipeline
Not every sale is a valid comparable. PropGap applies a 5-stage quality filter to the raw comp pool before computing a median — the same logic a qualified appraiser would apply manually.
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Stage 1 — Recency filter
Comps older than 5 years from analysis date are excluded. The preferred pool is the most recent 3 years; the 5-year pool is used as a fallback when the 3-year pool has fewer than 2 qualifying sales.
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Stage 2 — Data quality floor
Comps missing sale price, square footage, or sale date are excluded. A comp without square footage cannot be evaluated for size consistency.
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Stage 3 — NJ municipality enforcement
NJ comps are filtered to the same municipality as the subject property. Cross-municipality comparables are inadmissible before the County Board of Taxation under NJ practice.
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Stage 4 — 3σ outlier removal
When 4 or more qualifying comps exist, statistical outliers (price/sqft more than 3 standard deviations from the mean) are removed. This protects the median from distortion by non-arm's-length transactions.
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Stage 5 — Top 10 by recency
The final comp set is capped at 10, ordered by most recent sale date. Recency is weighted in accordance with standard appraisal practice (USPAP Standard 1).
Known Limitations & Disclosures
MLS data recording lag
Comparable sale data typically has a 30–90 day lag from deed recording to MLS database availability. Very recent sales may not appear in the analysis. Practitioners should supplement with direct county deed record searches for the most current data.
Tax rate is a statewide average
The tax gap estimate uses the statewide average effective rate. Actual municipal rates vary significantly — actual savings may be higher or lower. Always calculate using the client's municipal rate from their most recent tax bill.
Research tool — not legal advice
PropGap produces research data and statutory calculations. It is not a law firm and does not provide legal advice. Licensed tax agents, attorneys, and appraisers are responsible for reviewing, validating, and filing all submissions produced using PropGap data.
NJ equalization ratios are updated annually
NJ Division of Taxation publishes new ratios each March/April. PropGap verifies and updates its ratio table annually. If you are filing after April 1 of any given year and have concerns about ratio freshness, verify directly at njtaxation.org.
See the methodology in action
Every PropGap result includes a full Calculation Ledger — every formula step, every input, every source citation. Stored as a permanent audit record.