Understanding the difference between market value and sale price can lead to a tax reduction. The basis for a property tax appeal rests on an analysis of the property's value for real estate tax purposes, says Vickie L. Norman, Esquire, tax attorney and member of the American Property Tax Counsel. The valuation analysis can be based on numerous comparisons, the most important of which is the ocmparison of market price to sale price. The analysis also must include the property's ability to generate revenue. This valuation analysis provides the first clue regarding whether the assessor's valuation of a property is equitable. Market value is most often defined as the probable price a willing buyer would pay a willing seller in the open market. It implies that the property has been on the market for a reasonable lenght of time, and that both buyer and seller know the present and potential use of the property. The sale price at which a property sells does not necessarily reflect market value for property tax purposes. For example, a developer probably pays more than market value for parcels needed for a site being assembled to build a shopping center. On the other hand, a seller needing cash in a hurry probably sells at below market price. Also, in most cases the sale price includes more than just the tangible real estate. For more on how to avoid high property taxes, go to the APTC site at www.aptcnet.com.