Houses prices & property tax! (Chicago: for sale, real estate, foreclosure)

[jolobro]

We are soon to be emmigrating from the UK and i am a little confused re house prices and property tax amount. I understood that the property tax was calculated from the house value? However looking at some houses for sale this does not seem to be! Is this just because the house prices have fallen , where property tax has stayed the same? If we were to buy a house with a lower price but a higher tax are we getting a good deal? ie is the house listed cheaper than its assessed value?
Also if we were to do this can we then have the house reassessed regarding the property tax?
Example, i found a house for $139,000 and the taxes were nearly $6000 which seem to be alot compared to others??
Any advice or clarity would be really helpful!
Thanks

[subject2change]

Assessments can get skewed for one reason or another. A house may be very cheap because it's a foreclosure, or because it has maintenance issues that wouldn't be reflected in the assessment.
Personally, I'd rather pay more for the house and less for the taxes (if possible). When you sell, assuming we're not in another down market, you'll recoup what you paid for the house, but the property tax money you paid is gone forever.

[james57]

Housing prices have fallen by 33% or so in many areas. Most property taxes go to pay for schools. Its in the interest of the assessor to not reassess a property that has fallen so much. It would yield less in taxes. So they don't reassess.

If enough people protest and get their homes assessed at reduced valuations, then the authorities will just raise the tax mill rate to compensate. Taxing authority will get its taxes one way or another. You can't win in the long run.

The real solution is to live in a lower tax area. This certainly is not the Chicago area. However, the far southern part of the state has much more reasonable taxes on property.

[chet everett]

There are quite a few threads in the Chicago and Chicago Suburbs on this, the same formula & mindsets are technically in place for the whole state. As was hinted at above the biggest reason for a large sum being reported as the property tax for a modestly priced home is that the place was massively overpriced at one point in time. To oversimplify -- the various political units (municipality, schools, park districts, libraries, county, sewage etc..) all approve their levies, that adds to something to works out to say $2/$100 of assessed value. The assessor pegs the place at what similar houses sold for -- in this case about $300K. Bill for $6000 goes out. Prices collapse. Assessor is reluctant to redo valuations...

To expand on the other theme hinted at above, the more "well off" an area the LOWER the tax rate can be -- maybe down under $1/$100, and the areas with more demands on the less expensive home can have crazy high tax rates approaching $4/$100. Makes A LOT OF SENSE to 'shop up' so that you get a modest home surrounded by others that are much more expensive...

[linicx]

Real Estate taxes can vary from county to county. The formulary can change from year to year, too. Basically when you buy a house the taxes are pro-rated. Sellers pays part of the taxes and as the buyer you pay your portion of the taxes, too.

When the taxes are due they are a year behind. Therefore the 2011 taxes are for the year 2010. Your first tax bill will be for the amount the previous owner was assessed.*You have to live in your home as the primary residence for two consecutive january 1 dates before you can apply for a tax reduction. If you buy a house today you will live in it 19 months before you apply for a reduction. If you Close on your house (take possession) in December, you will be able to apply for a reduction in 13 months. If this is not as clear as mud, it should be.

Welcome to Illinois



If you paid much less than the asking price, then your taxes will be much lower when you apply for the reduction as it based on the based on the purchase price, not the price the house was appraised at when the seller bought it.. If the seller owned the house for 40-years, you will get one whopper of a new tax bill. If you live in a county and not any city, the real estate taxes are lower.*

[chicagojlo]

Just an FYI, unless you are paying cash, expect to rent for a good couple of years. You need a reasonable amount of US credit history before you can even think of getting a mortgage, and a green card helps.

[jolobro]

Thanks for all your help, we thought we may have to rent for a while but i just wanted to make sure we rent in an area which we could potentially look to buy as i want to get my girls settled in school and not have to mave schools due to a house move.
Re the earlier post re living in a county but not a city? We are looking at the belivdere area , if we live outside city limits as such will this be cheaper re property tax. We want to be close enough to belvidere for the girls to attend school there.