Are new Jersey property taxes High all around, do the wealthy pay the same rate as most jerseyans (Bayonne: how much, schools)

[KathyA11]

Originally Posted by tech2enable

How about counties, are they the major taxing agency, how about the state, do they get a large portion of the taxes or is mostly depending on town/school district.

Municipalities collect the taxes, but each town's individual tax rate is set by the county, after the municipalities adopt their budgets, and then submit them to the county board of taxation. The budget is set by the individual municipality, but the municipal portion of the tax bill is only a portion of the tax rate.

In Hudson County, the tax rate has three components -- municipal, school, county (some counties may have more because of special assessment districts). In Bayonne, the lion's share of the tax rate goes to the schools. There is no portion of the tax rate that is payable to the state.

[KathyA11]

Originally Posted by tech2enable

I thought so, but that means that a new home is assessed at market value (percentage of), while an older home isn't?

I think politicians say that the assessed value is different than market value to trick people so they don't know what they are paying,

The assessed value is different than market value due to the state constitution. Assessors are required to use the current ratio when assessing new construction.


for instance they may say I am increasing the tax rate from 12% to 13% and the assessed value by 5%, they are increasing it by over 8% or so.

They should instead assess at either the market value (if that's what they use in the state) or whatever value they are assessing at and just use ONE PERCENTAGE.

It's against the law.

Why the trouble using 2 percentages, it makes no sense except to confuse people,

Because this is what is required by the state constitution. In order to change it, there has to be a constitutional convention to change the constitution.


But it goes back to the question, is there such a limitation in NJ state law similar to prop 13 (without the change of ownership provision) and other state statues that if you live or own the home , or if the home is old and increases in value you pay less.

Nope.

For example a home in summit may have been worth 1.5 million adjusted for inflation in tax assessed value 15 years ago, today its 3 million adjusted for inflation, however the tax is not double adjusted for inflation

The tax is set by the amount needed to be raised by taxation.

because of state law, however a new home would be assessed at 3 million (a percentage of that with taxes being on that percentages, hence 2 different percentages)

No, the new home would be assessed according to the ratio -- if the market value is $3 million and the ratio is 50%, the assessment would be $1.5 million.

[KathyA11]

Originally Posted by luckyshoes

They can't do constant reassessments in real time. Should they do them more often? Probably, especially in towns where there is new construction. Sometimes towns wait for NJ to force them to reassess once assessments get out-of-line with market value (sometimes they wait for political reasons etc)

NJ assessors aren't allowed to spot-assess. With a few exceptions (renovations being among them), they can't reassess your house and not reassess your next-door neighbor's.A city-wide revaluation is the only thing that will bring everyone's assessed valuation into line.
They do assess at market value,

They assess at a portion of market value, based on the ratio.

but they don't do it all of the time and there are lags (hence the problems with new construction in some towns)

It's not just new construction -- it's also older homes selling for a lot more than assessed value. According to the state constitution, that house cannot be reassessed at sale. Thus, an older home valued at $115K which sells for more than twice that is still assessed at $115K -- but that sale (provided it's a qualified usable sale), will loser the town's ratio, thereby affecting the assessment of new construction and the assessment of renovations that qualify for reassessment.

[KathyA11]

Originally Posted by FBone

Tahiti and Anesthesia are correct. New construction pays more initially but after a reassessment they pay less and older homes increase dramatically. I was in the older home scenario. Last reassessment (which County orders every 10 years and performed by 3rd party)

Not necessarily. Revals aren't always done on a regular basis. Bayonne hasn't had one since 1990. It depends not only on the ratio of assessments to sales prices, but also to the coefficient (which compares residential property to commercial and industrial). In fact, most towns will resist a reval as long as possible -- it's a bug budget item, and a huge hassle for municipal employees and homeowners as well. Most times, revals are ordered by the county board of taxation or by the state.

my taxes went up 20% but newer oceanfront construction decreased 20%. They still paid more in taxes due to higher home value but more equitable since all home assessments were done at the same time. They assess at about 80% of current sale value. At least that's their goal according to the guy who came to my home.

Revals are usually done at 100% of market value.

And he was very thorough. He noticed every little thing that will lower my property value. Especially the surroundings since land portion is most of your assessment.

Not everywhere, it's not. In towns with small lots (standard lot in Bayonne is 30 x 100, and the structure will take up most of that), the improvements are a much larger portion of your assessment than the land value. In our case, we have a 50 x 100 lot, and while that increased our land assessment, it's still less than the assessment for our small house.

[KathyA11]

Originally Posted by dmccauley

Another thing is each town does set their own tax rate.

No, it doesn't. The tax rate is set by the county. Each municipality will adopt its own budget, which is then submitted to the county. After all budgets for the county's municipalities are in (including school budgets), the county strikes the tax rate for each town -- which will, of course, include a portion for the county.

This tax rate is not only based on the towns budget but the amount of delinquent taxes are added into the budget which drives up the rate.

Not quite. Each municipality's budget has a a line item which is called the reserve for uncollected taxes, but it's not as large as you'd think. Many towns (Bayonne among them) sell the unpaid taxes to a third party,which means their collection rate is close to 100%.

So this pretty much answers your question about the wealthy. Living in a more affluent town more then likely their tax rate is lower because of less delinquent taxes for instance Rumson barely has any and their tax rate is pretty low. Not saying houses are cheap there though

Bayonne's uncollected tax rate is pretty low -- but the rax rate is pretty high. It all depends on the amount that has to be raised by taxation. An urban town, with a large police/fire/teacher base, will have a higher budget than a suburban town with smaller numbers of those employees.

[KathyA11]

Originally Posted by tech2enable

Maybe but I believe there is more to the story, it does seem that some sort of local control is part of the problem, but doesn't it also stem from state mandates, and also on the other flip of the coin , not enough state aid.

Yes, and yes!

[Caro257]

Thre is a tax rebate in NJ. However, if you earn more than 75K per household you won't qualify. Most of us don't....
Taxes vary from town to town, the most expensive county is probably Essex, Union is nice and cheaper as to taxes but the property values are higher.
You can compromise to get something in Union for more and pay less in taxes or get a cheaper house in Essex and pay a lot in taxes. That, of course, is not a rule but Essex is one of those higher bracket counties.
Have you checked Springfield, Maplewood, Westfield?

[AnesthesiaMD]

Originally Posted by Caro257

Union is nice and cheaper as to taxes but the property values are higher.
You can compromise to get something in Union for more and pay less in taxes or get a cheaper house in Essex and pay a lot in taxes.

I'm sorry, but as a general statement this couldn't be further from the truth. Property values in Union County are higher than Essex Fells? Short Hills? North Caldwell? Livingston? Upper Montclair? Your statement is only correct if you average in Newark, Irvington, etc.

[FBone]

Quote:
Originally Posted by FBone
Tahiti and Anesthesia are correct. New construction pays more initially but after a reassessment they pay less and older homes increase dramatically. I was in the older home scenario. Last reassessment (which County orders every 10 years and performed by 3rd party)

Not necessarily. Revals aren't always done on a regular basis. Bayonne hasn't had one since 1990. It depends not only on the ratio of assessments to sales prices, but also to the coefficient (which compares residential property to commercial and industrial). In fact, most towns will resist a reval as long as possible -- it's a bug budget item, and a huge hassle for municipal employees and homeowners as well. Most times, revals are ordered by the county board of taxation or by the state.

In Monmouth County the revaluations are done every 8-10 years unless the county feels assessments are still accurate. Its mandated and towns cannot refuse. Towns know ahead of time and budget accordingly. Its not unusual for there to be 15 revals each year countywide.

my taxes went up 20% but newer oceanfront construction decreased 20%. They still paid more in taxes due to higher home value but more equitable since all home assessments were done at the same time. They assess at about 80% of current sale value. At least that's their goal according to the guy who came to my home.

Revals are usually done at 100% of market value.

Again in Monmouth County, they assess for at least 80% of market value. Since it takes a year for the reval housing prices can fluctuate greatly. They didnt achieve 100% but as long as they hit 80% it's legal. As owners can appeal if values drop 15%, towns dont want everyone appealing because the reval overassessed 14 months ago.

And he was very thorough. He noticed every little thing that will lower my property value. Especially the surroundings since land portion is most of your assessment.

Not everywhere, it's not. In towns with small lots (standard lot in Bayonne is 30 x 100, and the structure will take up most of that), the improvements are a much larger portion of your assessment than the land value. In our case, we have a 50 x 100 lot, and while that increased our land assessment, it's still less than the assessment for our small house.

This again varies per town. In my city according to the 2007 reval a 50x100 lot on my block was assessed at $119,700 but improvements (1000sq ft homes) assessed less. However,other parts of town is the reverse but then they have large homes on small lots (like your town) or near the ocean.

[elflord1973]

Originally Posted by KathyA11

Municipalities collect the taxes, but each town's individual tax rate is set by the county, after the municipalities adopt their budgets, and then submit them to the county board of taxation. The budget is set by the individual municipality, but the municipal portion of the tax bill is only a portion of the tax rate.

In Hudson County, the tax rate has three components -- municipal, school, county (some counties may have more because of special assessment districts). In Bayonne, the lion's share of the tax rate goes to the schools. There is no portion of the tax rate that is payable to the state.

Thank you for adding plenty of great info to this discussion. I have some further questions:

Approximately what portion goes to (Hudson) county ? And what are those funds used for (the county portion) ? Is it much the same for other counties in NJ ?