Behind The Numbers:
How Property Valuations
Are Calculated In Nebraska

By LuAnn Schindler Summerland Advocate.

For many homeowners, property valuation notices arrive in June with more questions than answers. How was the number determined? Why did it change? And who decides what a home is worth?

In Nebraska, the answer lies in a structured, data-driven process guided by state statute, local sales, and oversight from state officials.

Under Nebraska statute, all property must be assessed at its "actual value," meaning its market value in the course of trade, essentially what a typical buyer would pay a typical seller.

That legal standard drives everything assessors do.

Holt County Assessor Tim Wallinger says it all starts with real estate sales, but not just any sales.

Historical Perspective

According to a Feb. 24, 2026 report from the Nebraska Department of Revenue's Property Assessment Division, since 2015, residential and recreational property values in Holt County have increased from $260,251,143 to $441,751,806.

While that $181.5 million increase may seem high, the average annual rate of increase is 5.43%.

In the same time frame, commercial and industrial valuations have experienced an average yearly bump of 8.22%, while agricultural land has increased, on average, 2.45%.

The Role of Sales Data

Property valuations are built from actual home sales within a defined time frame.

"To set residential values for 2026 we use two years' worth of sales. Sales range from Oct. 1, 2023, to Sept. 30, 2025," Wallinger said.

Not every sale qualifies. The scenarios vary.

For that time frame, 215 property sales were used to set value for 2026.

"One of my main jobs is to look at sales and only use arms-length transactions," he said. "Sometimes family sales are not used because mom sold it to a child for a low amount. Other times family sales are used if the family says that an appraiser set the sale price."

That filtering process aligns directly with state law's focus on true market value, not distorted or non-typical sales.

How Ratios Drive Valuations

At the heart of the process is a key calculation:

Assessed value ÷ sale price = ratio.

"Each sale has a ratio," Wallinger said. "You then line up all the ratios, smallest to largest. The median ratio is what determines if assessed values need to be adjusted for 2026."

The state requires that the median ratio falls between 92% and 100%, ensuring assessments closely match actual market value.

This requirement reflects Nebraska's broader mandate that property be assessed uniformly and proportionately at its actual value, per the Nebraska legislature's statute.

If it falls outside that range, adjustments must be made.

Real Examples

Based on Nebraska Department of Revenue information for 2025, Holt County's residential statistical analysis includes 215 sales representing eight valuation groups.

For example, in O'Neill, Wallinger used 126 of the 171 recorded residential sales. The median was 84.89%, falling below the established ratio.

Next, the report is submitted to the Tax Equalization and Review Commission each March.

"TERC either says ok, or we need to adjust something. The next step is the change of value notices."

For the following year's valuations, the process repeats with updated data.

"For setting the 2026 assessed value for O'Neill, we are using 126 sales. The beginning ratio for O'Neill is 84.89. Statute says it has to be between 92 and 100."

In Ewing, the beginning ratio is 84.49; Page, 84.69.

That initial number signals that values are too low compared to recent sales, meaning adjustments are required.

Making Adjustments

Nebraska's assessors don't simply raise values across the board. Instead, they adjust multiple components of the valuation model.

After adjustments are made to land value, cost tables, depreciation tables and any new information the assessor's office discovers about houses that sold, the data is entered into the computer system and shows the median ratio for O'Neill is 94.10. Ewing's median ratio is 94.45; Page, 99.73.

These adjusted medians fall within the required range.

At that point, assessors must make a judgment call.

"The assessor has to decide if he or she should push the Value Up to maybe 99%, in hopes of not having to move it so much next year or stay on the low end or in the middle," Wallinger said.

Beyond hitting the required ratio range, assessors also measure how evenly values are applied across different types of homes.

"The coefficient of dispersion (COD) and price-related differential (PRD) are measurements used to determine if small houses are overassessed when compared to large houses, or if large houses are overassessed when compared to small houses."

These statistical tools help ensure consistency so that similar properties are treated similarly, regardless of size or price.

Why a Small Number of Sales Matters

One of the most surprising aspects of the process is how few sales can influence an entire community.

"This also means that 126 sales in O'Neill determine how all residential parcels in O'Neill are assessed. Around 8% of the parcels affect everyone."

Because only a fraction of properties sell in a given period, those transactions carry significant weight in shaping valuations for all homeowners.

Once the analysis is complete and approved, valuation changes are sent to property owners.

From law to your mailbox

From state statute to local sales data, Nebraska's valuation system is designed to reflect one central idea: what properties are actually selling for in the market.

That's why valuations can rise, even if a homeowner hasn't made changes to their property. The market, not the individual property, is often what's changing.

Understanding that process doesn't always make a higher valuation easier to accept. But it does explain why those numbers change, and why, under Nebraska law, they're required to follow the market.

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