Comparing property tax burdens (sales, how much, buying a house)

[Ourdreamhouse]

Given how much money is spent on NJ property taxes, what's the best way to compare tax burdens (1) within NJ; (2) between NJ towns and those in other states?

I'm thinking that it would be easiest to compare absolute tax amounts (not assessed value, mill rate, etc.) on a benchmark, e.g. a $400k house. (For this purpose, all "grandfathering" is excluded.)

It would be useful to know, for example, that the taxes on a $400k house in Town A would be $10,000, in Town B would be $7,000, while in Town C in another state would be $5000.

Can anyone comment on this? For someone thinking of buying a house, is there a better way to determine which NJ towns are most expensive from a tax perspective, and how much more expensive they are than those in other states?

[JerzBoy]

Check this site out NJ.com: Everything Jersey

It does a good job of comparing property taxes and home prices in NJ

[tahiti]

Originally Posted by Ourdreamhouse

Given how much money is spent on NJ property taxes, what's the best way to compare tax burdens (1) within NJ; (2) between NJ towns and those in other states?

I'm thinking that it would be easiest to compare absolute tax amounts (not assessed value, mill rate, etc.) on a benchmark, e.g. a $400k house. (For this purpose, all "grandfathering" is excluded.)

It would be useful to know, for example, that the taxes on a $400k house in Town A would be $10,000, in Town B would be $7,000, while in Town C in another state would be $5000.

Can anyone comment on this? For someone thinking of buying a house, is there a better way to determine which NJ towns are most expensive from a tax perspective, and how much more expensive they are than those in other states?

you can use effective rate, but i don't know how accurate that would be, but it's probably the best bet.

State of New Jersey Division of Taxation (http://www.state.nj.us/treasury/taxation/index.html?lpt/taxrate.htm~mainFrame - broken link)

[BobKovacs]

Comparing on NJ city to another NJ city is easy- just compare actual property tax dollars. But, you've also got to consider other taxes/costs besides just the property tax, and also compare apples to apples on the "amount" of house you're getting for your money in NJ if you're going to compare costs in NJ to costs in another state.

As an example, we left a $320k house in NJ with just under $6k in property taxes. We bought a $300k house in Holly Springs, GA, and we pay around $3,300 in property taxes. So, it looks like we save $2,700. However, we also pay just under $500/year in "personal property tax" on our cars, our state tax is higher for lower brackets relative to NJ (it's the same in the tax bracket I'm in), and our gasoline tax is higher (costs us roughly $300/year move in gas). We also pay sales tax on clothes, and a small sales tax (2%) on most food, so maybe that adds up to another $500/year. All in, our "tax burden" is only +/- $1,400/year lower.

Now, that doesn't seem like alot, but when you factor in that the $300k home we bought would cost roughly $700-800k in most parts of NJ, and that to get into a comparable area as far as lot size, surrounding farmland etc., we'd end up in someplace like Hunterdon County, we'd likely be paying $10-12,000/year (or more) in taxes. Now our relative tax burden is anywhere from $5,400-7,400 (or more) lower than in NJ.

If we looked at it the other way, and said "what would it cost to replace the 1,000 SF, 50 y/o, 3BR cape we left in NJ", we could probably buy that house in a comparable neighborhood for around $120k, and only pay $1,500/year in taxes, so again, our burden would be roughly $3,200/year lower.

So, that's three different ways to look at what you're trying to do, all with different results. Confused now? lol