Most property is assessed based on its market value. This is the price the property would bring on the open market, between a willing buyer and willing seller who are not under duress. Currently in the State of Illinois, other than Cook County and farm class properties, the statutory level of assessments is 33.333% of market value. This means that the property assessed value should be one third of its market value. There are three valuation methods available to arrive at this value:
- Cost Approach – determining the replacement cost of property minus depreciation plus land value.
- Sales Comparison or Market Approach – using the comparison of recent sales prices of similar properties.
- Income Approach – calculating the present worth of property based on the income of income-producing property.
Farm land is assessed according to agricultural economic value, as certified by the Illinois Department of Revenue.