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NJ property taxes is just outrageous but, it may not be that bad for good towns. As you can recoup the taxes in terms of high quality services. But one thing that is crazy is that many less well to do towns have very high property taxes too. One look at certain town's property public records reveals a bad street still has very high taxes from $12-14k
Take Irvington or parts of Union, there are many houses with $13k property taxes in very sketchy parts. Granted many of the houses there are already in foreclosure so the banks are paying for them.
Then you look at some $1.1mil house, it is only paying $16.5k property taxes in a good town. That's not so bad when you look at the size and quality of the town compare to some small house in a crummy town still paying $12k.
Some folks must be getting assistance because the certainly don't make enough to pay for the taxes.
16.5k tax on 1.1mil house (1.5%) is low for prop tax for NJ. Avg is 2 to 2.5% in NJ.
So either that house you mentioned of 1.1.mil with 1.5% prop tax hasn't bee evaluated in a while (e.g. Jersey City had been putting off reval for years till last year) or that town has unusually low prop tax. New condos going up in downtown JC without tax breaks are informing potential buyers expect ballpark 2.22% of valuation for prop tax.
Prior to latest tax changes, specifically SALT. Paying 12-14k in crummy home probably meant that perhaps the home owner was taking that into account and was not paying a whole lot into their income taxes assuming they can reduce their end of the year total tax responsibilities.
16.5k tax on 1.1mil house (1.5%) is low for prop tax for NJ. Avg is 2 to 2.5% in NJ.
So either that house you mentioned of 1.1.mil with 1.5% prop tax hasn't bee evaluated in a while (e.g. Jersey City had been putting off reval for years till last year) or that town has unusually low prop tax. New condos going up in downtown JC without tax breaks are informing potential buyers expect ballpark 2.22% of valuation for prop tax.
Prior to latest tax changes, specifically SALT. Paying 12-14k in crummy home probably meant that perhaps the home owner was taking that into account and was not paying a whole lot into their income taxes assuming they can reduce their end of the year total tax responsibilities.
The tax re-eval in certain towns will probably have an effect in 2-3 years. It will take a bit of sticker shock and depending on the SALT calc a few cycles.
Places like West NY granted there are some very expensive condos and attached homes built there, but that's the water front. The rest of the area isn't so nice looking but expect to Pay $9k-13k for some of those homes not to mention Paterson also has high taxes in bad parts.
Jersey City and Newark is just so iffy and taxes can hurt when your property is not on the best parts
Step 1) Buy a house in 2001 at 1/4 of the price it's valued at today.
Step 2) Continue to live there and watch your property skyrocket while you get a meager 3% annual increase at work.
Step 3) Take out equity loans to max out your loan-to-value to help pay your property taxes, your daughter's wedding, your cruise to the Bahamas, and your mid-life crisis corvette.
Step 4) Go into foreclosure and blame Trump/Obama/Whatever candidate you dislike most at the moment
I have wondered the same thing too. Towns like Hackensack and Lodi with obscene taxes. It really makes no sense to pay that much. Unfortunately areas like these will really feel the pinch of property tax write-off caps.
I believe one of the reasons it's still in bare line affordable, is due to women participation in the workforce, basically due to double income vs mostly single income earners years ago. Now I rarely see stay at home moms anymore.
HudsonCoNJ is correct, a lot of people bought their first house pre-2000 before the huge jump in prices, partly due to crazy low interest rates, that tend to inflation all asset values, properties, stocks, etc.
NJ property taxes is just outrageous but, it may not be that bad for good towns. As you can recoup the taxes in terms of high quality services. But one thing that is crazy is that many less well to do towns have very high property taxes too. One look at certain town's property public records reveals a bad street still has very high taxes from $12-14k
Take Irvington or parts of Union, there are many houses with $13k property taxes in very sketchy parts. Granted many of the houses there are already in foreclosure so the banks are paying for them.
Then you look at some $1.1mil house, it is only paying $16.5k property taxes in a good town. That's not so bad when you look at the size and quality of the town compare to some small house in a crummy town still paying $12k.
Some folks must be getting assistance because the certainly don't make enough to pay for the taxes.
I’m not familiar with taxes in Irvington but someone paying 14k on property taxes property has a huge multi family house (at least 3 family) and they aren’t living there. They own it to collect rent. The property value is so cheap that they still make money. Regarding Union there’s probably very few comparatively speaking super high tax homes.
Union is an ok place but when you look at the some of the worst places in north Jersey (Paterson, Irvington, East Orange, etc) they have artificially high tax rates. There are very few properties in these towns that have high assessments so the taxes as a net amount are low. There was some article about the highest tax Towns in NJ and it featured the wealthiest towns and they have low tax rates. For example a single family house in Irvington besides being half the price will have much less less taxes than a house in Florham Park which is known for low taxes.
16.5k tax on 1.1mil house (1.5%) is low for prop tax for NJ. Avg is 2 to 2.5% in NJ.
So either that house you mentioned of 1.1.mil with 1.5% prop tax hasn't bee evaluated in a while (e.g. Jersey City had been putting off reval for years till last year) or that town has unusually low prop tax. New condos going up in downtown JC without tax breaks are informing potential buyers expect ballpark 2.22% of valuation for prop tax.
Prior to latest tax changes, specifically SALT. Paying 12-14k in crummy home probably meant that perhaps the home owner was taking that into account and was not paying a whole lot into their income taxes assuming they can reduce their end of the year total tax responsibilities.
Many of the towns that low (or lower) are shore towns where there are expensive homes but there are not a lot of kids in the schools because many of the homeowners don’t live there during the school year. School children are a town’s largest expense.
I’m not familiar with taxes in Irvington but someone paying 14k on property taxes property has a huge multi family house (at least 3 family) and they aren’t living there. They own it to collect rent. The property value is so cheap that they still make money. Regarding Union there’s probably very few comparatively speaking super high tax homes.
Union is an ok place but when you look at the some of the worst places in north Jersey (Paterson, Irvington, East Orange, etc) they have artificially high tax rates. There are very few properties in these towns that have high assessments so the taxes as a net amount are low. There was some article about the highest tax Towns in NJ and it featured the wealthiest towns and they have low tax rates. For example a single family house in Irvington besides being half the price will have much less less taxes than a house in Florham Park which is known for low taxes.
You have picked a town with the highest effective tax rate and compared it to a town with one of the lowest.
Irvington is 5%.
Florham Park is 1.5%
(Effective tax rate numbers directly from the NJ Treasury department web site.)
Assuming reasonably recent valuations, a home in Florham Park that is valued 3X that of a home in Irvington, will still pay less actual dollars than the Irvington home.
Is it fair?
When it comes to property taxes, fairness isn’t a factor. The town has expenses that need to be paid somehow. If the homes are not worth a lot, they will be taxed at a higher percentage, because as I said, the town’s expenses have to be paid one way or another.
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