Improved Value???

[Chris T.]

What does "Improved %" and "Improved Value" mean regarding real estate?

[Harry M.]

Hey Chris,
In tax assessment speak, the 'improvement' is the house itself, as opposed to the lot.
So, your 100k house with an improvement percent of 80% means that of the total value of 100k, the improvement (house) is worth 80k, with the lot being worth 20k.
The significance is that come tax time, you claim a deduction of about 3.6% (1/27.5) of the value of the house for depreciation, but not the land. Note that this doesn't have anything to do with whether the house actually depreciates or appreciates in value over that time. The kicker is that the deduction has to be repaid years later when the property is sold (called depreciation recapture).