Found an absolutely perfect house... but the taxes kill the deal (property, offer)
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Well the taxes on the listing were $9200 however those were taxes were from 2006 NOT 2008. The most recent bill the taxes were at $13,300. The house was listed at $399K but the owner purchased the house in 2005 for $385K. So they're's not real room to move. The house is listed about $20K below comp. The Original LP was $410K. I was hoping to talk them to $375 with taxes around $9K puts my PITI at $3K over $3500.
So I'm confident on passing. It's a newer construction in an unfinished sub-division. The taxes will only increase.
unfortunately you can't select what you want to pay for taxes (oh boy if we could I think we'd all be paying one big gigantic goose egg). So what if they purchased the house for $385K in 2005. seriously you won't know what they'll accept until you actually put in an offer. heck when hubby and i put in our offer on our home in VA we came in almost $70K lower than list. we KNEW it was really low but we figured we had nothing to lose by doing it. I have no idea what they owed on the house. all i know is we got it for almost $50K less than list.
Based on that, over time the taxes will decrease as the tax base becomes larger.
Well let me add... there are only 4 empty lots left in the sub-division and the builders are at a stand still. Of course I could grieve them, but I can't put myself in a corner when I'm priced out by taxes. My PITI could be $4000 in 3-4 years. I don't see my income, especially with the current economy keeping pace.
BTW... I think this is the reason the house is on the market. The seller is getting 'out.'
Based on that, over time the taxes will decrease as the tax base becomes larger.
I have NEVER seen that happen. The ONLY time I have seen a tax rate go DOWN is if the city gets some kind of tax break from the state. I've bought 3 homes all being in NEW subdivisions still being built in and not ONCE have the taxes gone down.
With new development comes MORE needs and MORE burden on the city/coutny/schools for infrastructure. They have to pay for it somehow.
My tax bill for the home I just purchased went down over last year as the MUD fees were paid off.
As a rule, the greater the industries/population base, the lower the taxes have to be to maintain an equivalent level of service. Of course if you have mismanagement of the tax revenue, all that goes out the window...
Well let me add... there are only 4 empty lots left in the sub-division and the builders are at a stand still. Of course I could grieve them, but I can't put myself in a corner when I'm priced out by taxes. My PITI could be $4000 in 3-4 years. I don't see my income, especially with the current economy keeping pace.
BTW... I think this is the reason the house is on the market. The seller is getting 'out.'
Do NOT buy a house IF the current taxes would already be more than you are comfortable with even IF you could get the home for less than what is on the tax rolls. It will only be a matter of time before the values are back up. The tax districts do not like to lower their rates or the value they have on a property unless you go protest for that one (spend time getting data together to go protest which means time off from work). You need to allow yourself more wiggle room to be comfortable in case of an emergency. Taxes are NOT something that one can just overlook. You can't put the thermostat for taxes on a lower setting to save money. You can't cut a coupon for a % off of your property taxes. Any improvements you do will also INCREASE the value which raises the taxes. New growth in the area means more roads are needed as are: emergency services, schools, libraries, community centers, etc. All of those things are paid for by taxes. Get the local paper and start REALLY searching for any news about bond proposals. See if the city or school district is looking to pass a new bond which would mean MORE tax dollars needed.
Not knowing how the taxing entities in your area work as far as districts and such I will say how you can look things up here and maybe look in an area w/ a lower tax rate. Go to the county tax appraisers website and find the current tax rates for each city/town/county/school district in your area. Compare their current rates to the last few years and find one that is stable. You might be able to look in a different area w/ the same housing but lower taxes. FYI, bedroom community type cities tend to have a HIGHER tax rate as they don't have as many businesses to take the tax burden off of the homeowners.
My tax bill for the home I just purchased went down over last year as the MUD fees were paid off.
As a rule, the greater the industries/population base, the lower the taxes have to be to maintain an equivalent level of service. Of course if you have mismanagement of the tax revenue, all that goes out the window...
My tax rate for the CITY went down a hair but that is ONLY because the STATE cut a sliver of taxes. woo-hoo, not enough to matter as they makei it up somewhere else. Not all of us live in areas w/ MUD fees. I actually prefer NOT to.
Yes, if a city has a large enough base of businesses to ease the tax burden from homeowners this is true. HOWEVER, there are plenty of "bedroom community" type cities out there w/ very little in industrial/commercial business to ease that burden. If it is a really new area it will take time for that tax base to come and get built up. HOWEVER, if it is a pretty new and growing area that is trying to catch up or stay caught up they may not drop the tax rates for awhile in order to get the roads in/improved, new schools built, more police/fire personal, etc.
For someone that is not comfortable w/ the CURRENT tax bill that is WAY TOO MUCH to bet on in hopes of getting their taxes down.
My tax rate for the CITY went down a hair but that is ONLY because the STATE cut a sliver of taxes. woo-hoo, not enough to matter as they makei it up somewhere else. Not all of us live in areas w/ MUD fees. I actually prefer NOT to.
Yes, if a city has a large enough base of businesses to ease the tax burden from homeowners this is true. HOWEVER, there are plenty of "bedroom community" type cities out there w/ very little in industrial/commercial business to ease that burden. If it is a really new area it will take time for that tax base to come and get built up. HOWEVER, if it is a pretty new and growing area that is trying to catch up or stay caught up they may not drop the tax rates for awhile in order to get the roads in/improved, new schools built, more police/fire personal, etc.
For someone that is not comfortable w/ the CURRENT tax bill that is WAY TOO MUCH to bet on in hopes of getting their taxes down.
2 years ago my town lowered their tax rate but then reassessed every home in the town. almost every homeowner saw an increase in their tax bill.
I don't know how things work in new york, but here in the chicagoland area, taxes never go down. if there is not some type of referendum asking for new schools, community college fees, etc. to increase the tax rate, it will then be time for the county to re-assess the value of your home. if the taxes are too high today, and you can't be sure of regular pay increases, i would say, look for a different house.
Is it helpful to let the seller or Listing Agent know. We came across a home this week that was absolutely beautiful in the price range we were looking for. However after looking into the property data and seeing the recent tax bill we've found the home is priced more than $500 than our monthly budget allows. Even though we more than qualify for the mortgage it's not even worth it to place a bid on the home... looking at what the owners paid for the house in 2004 they would be short $30-$40K to come close to what we wanted to pay on our monthly. Is it helpful to give feedback regarding the taxes on a particular home. It's not anything the seller can help or fix, however it may give a clue to the seller and/or the listing agent why they aren't getting offers after a showing?
I've looked at several properties like this lately. Currently trying to close on one thats taxed at $100K value over the current value.
Keep in mind that if a property is properly marketed to the general consumer (no insider transactions), that your appraisal, and sales price can be used to dispute, and Hopefully (never a guarantee) the taxes will be lowered.
You are VERY smart to consider Property Taxes before you Buy
The only time I've experienced a tax decrease is after CA voters passed Proposition 13.
I've actually experienced the opposite... taxes increase, especially in States without limits or States with high limits.
I bought in WA in late 2005. My WA tax bill, the amount I paid has gone up every year... Just received this years bill and my payment went up 31% !!!!!
I think Property Taxes will only continue to spiral upward... I tried contesting my WA Assessment with Sales Data and two appraisals... I wasted a lot of time and didn't achieve anything.
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You are VERY smart to consider Property Taxes before you Buy
