Frequently Asked Questions (Property Tax)

QuestionWhy does the assessed value not decrease even if the house becomes old?

Response

The assessed value of a building is determined by multiplying the reconstruction cost, which is the construction cost required to build a new structure at the same location as the building being assessed at the time of reassessment, by the depreciation rate that reflects the usual wear and tear due to the passage of years since the building was constructed. (However, if this value exceeds the previous year's value, it is generally maintained at the previous year's value.)
For some older buildings, due to the fact that their assessed values have been maintained in the past despite continuous increases in construction costs, even when considering the depreciation rate, the assessed value may not fall below the previously maintained value, resulting in no decrease in the assessed value.