Why Boston's priciest homes are assessed far below their sale prices

Boston's Assessing Department agreed Oct. 8 to give city councilors new data comparing its values with sale prices at the top of the market, after councilors pointed to luxury homes assessed far below what buyers paid.

City Councilor Miniard Culpepper (District 7), the lead sponsor, said the 20 highest-priced residential sales were assessed at about 80% of their sale prices in the 2023 and 2024 data, and about 68% for 2025 sales. The 20 lowest-priced single-family sales were assessed at about 95.5% to 105%, he said at the Ways and Means Committee hearing.

One Commonwealth Avenue home, highlighted by The Boston Globe, sold for $21 million but carried an assessed value of $12.5 million, Culpepper said. Another Commonwealth Avenue sale, for $15 million, was assessed at $4.4 million.

Assessments set each owner's share of the property tax, which brought the city more than $3.5 billion in fiscal 2026, the department said. The question is whether the gap at the top is a flaw in the system or a few outliers in a model that, by the state's measures, treats cheaper and pricier homes alike.

Culpepper, City Councilor Brian Worrell (District 4) and City Councilor Erin Murphy (at-large) filed the hearing order, docket 0586, which was referred to the committee March 18.

“There's a major problem here that we can't seem to get to why it takes place the way it does.”

Hinlan Wong, the city's interim commissioner of assessing, defended the department's methods. Every Massachusetts community sees unusual sales at the top, Wong said: “We are going to have high end outliers.”

The department's job is to read “the pattern and the forest, not just one individual tree,” Wong said.

Why don't the numbers match?

Under state rules, Wong said, values for fiscal 2026 were built from sales in calendar 2024, so a 2025 sale could not be used.

“Assessed values and what the current market is I would say are apples and oranges,” Wong said.

The most-cited sale, a two-family that Wong said closed in 2025, will be counted next year: “We will account for that sale this year for fiscal year 27.” Similar two-families nearby with more square footage sold for about $13 million, Wong said.

“What we're not going to do is we're not going to value all two families at $20 million without adequate support,” Wong said.

Culpepper's figures, though, showed high-end homes assessed at about 80% of sale price in 2023 and 2024 as well, not only in 2025.

The department values homes with a statistical model built from valid sales and features such as living area, bedrooms and location, Wong said. The state certifies the values each year, and Wong said Boston passes its tests of vertical equity, which check that cheap and expensive homes are assessed alike.

What outside experts said

Chris Lehman, a board member of the Small Property Owners Association, which represents small landlords, said that in fiscal 2026 the “under assessment of just the top 20 homes amounted to $83 million.” He called that part of the tax base “that was just not taxed,” but did not say how much tax revenue it represents.

Lehman said setting outlier sales aside skews the model. “It's going to be flatter and therefore have lower assessments for high end properties higher assessment for low end properties,” he said.

City Councilor Benjamin Jacob Weber (District 6), the committee chair, asked whether comparing only the top 20 and bottom 20 sales was “cherry picking.” Lehman said the groups were set in advance.

Ruchi Singh, an associate professor of real estate at the University of Georgia, said the examples come from a small number of sales at the very top. “When you look at all the sales, Boston's assessment meets professional standards for treating low priced and high priced homes alike,” Singh said.

Singh cited research by a former Boston assessing commissioner, now a fellow at the Lincoln Institute of Land Policy. In 2017 Suffolk County sales, the cheapest tenth of homes was assessed at about 95% of sale price and the priciest tenth at about 91%. Sliced more finely, Singh said, the gap starts to widen.

Singh said the system does well on average but misses at both ends. “Should we leave $83 million on the table? Probably not,” Singh said, suggesting finer location data, different models for high-end homes and appraiser visits to the priciest properties.

What does it mean for my tax bill?

If assessments run low at the top, Weber said, “the burden is unfairly being placed on lower value homes.” Singh said the residential exemption, a flat deduction for owners who live in their homes, more than offsets that gap on their bills.

The exemption saved qualifying owners $4,353.74 in fiscal 2026, Wong said. In Singh's example, a $500,000 owner-occupied home pays about 0.4% of its value in tax, while a $5 million home pays about 1.2%.

Lehman said the exemption moves taxes onto rental buildings and their tenants. “The homestead exemption forces landlords and renters to subsidize homeowners,” he said.

City Councilor Ed Flynn (District 2) said homeowners saw increases of about 10% and 13% in the past two years. Wong said the department sets values; the tax rate depends on the council's coming vote on how much of the burden shifts to commercial property.

No one at the hearing estimated how much other homeowners' bills would change if high-end assessments rose.

Three residents testified. Frank Baker, a former district city councilor from Dorchester, said “it really pays to be rich in Boston.” Melissa Guzman, a former department employee, said she saw inconsistent abatement reviews and that “these issues deserve transparency and appropriate independent review.”

What happens next?

Wong agreed to send Worrell assessment-to-sale ratios for homes that sold for $2 million and more, counts of properties below a 0.92 ratio, figures by assessment district and a per-bedroom breakdown for apartment buildings. No deadline was set, and the committee took no vote.

Homeowners can look up their property record card and the sales the city used on the department's website, and meet with an assessor, Wong said. The window to file for an abatement, a formal challenge to an assessment, runs from Jan. 1 to Feb. 1.

Closing the hearing, Weber said the two sides were “sort of talking past each other”: the citywide statistics show no regressive pattern, while the examples show a system “not working as intended.”