What occurs to the MAV when the RMV falls more than 3% below it?

The correct response indicates that when the Real Market Value (RMV) falls more than 3% below the Maximum Assessed Value (MAV), the MAV freezes and does not change. This concept is tied to the property tax system, particularly in the context of property appraisal and assessment in Oregon.

Essentially, the MAV represents the highest limit on assessed value for a property, which typically increases annually based on a certain percentage, but it can't exceed the RMV. When the RMV drops significantly – in this case, by more than 3% – the MAV remains static to provide stability for property taxes owed, preventing sudden increases in tax burdens because of fluctuating market conditions. This mechanism ensures that property owners are not penalized with increased assessed values and taxes when the real estate market experiences a downturn, thus promoting fairness in property taxation.

Through this freezing of MAV, property owners can maintain a more predictable tax liability during economically challenging times. Being aware of how the MAV operates in relation to the RMV is critical for understanding property taxation in Oregon and helps property appraisers in their assessments.