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Old 07-10-2013, 08:45 PM
 
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I have a question about your property tax reassessment -

Was it reassessed at your purchase price? Was it the next year?
If not at purchase price, what % below was it?

Thanks to all who can answer - getting very conflicting data about this subject. Some say it goes to the sale price the very next year, others say sale price is only 'taken into consideration'
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Old 07-10-2013, 09:44 PM
 
Location: Whispering pines, cutler bay FL.
1,912 posts, read 2,371,422 times
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Just purchased our home in whispering pines so it will be a while before I reply. I think they will reeval after it goes off homestead and based on the area not the house. I am equally confused and hoping for the best!

I know that after I purchased my home in the area the prices of homes when nuts and they jumped quite a bit, the interest rates going up have slowed things down a lot so I don't know.
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Old 07-11-2013, 07:07 AM
 
15 posts, read 39,896 times
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Quote:
Originally Posted by Cubanchic View Post
Just purchased our home in whispering pines so it will be a while before I reply. I think they will reeval after it goes off homestead and based on the area not the house. I am equally confused and hoping for the best!

I know that after I purchased my home in the area the prices of homes when nuts and they jumped quite a bit, the interest rates going up have slowed things down a lot so I don't know.
Its definitely confusing. I hear everything from "it shouldnt change much from existing" to "expect it to jump to market price"
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Old 07-11-2013, 09:51 AM
 
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Ok, final answer here. I figured it out.

What you pay for a house is NOT a factor at ALL in determining your property tax. Only neighborhood values go into figuring out your assessment and you can find out what that is before you buy. So even if you buy that house on the corner for a billion dollars, your property tax will still be based on the neighborhood value.

Go to Property Search and enter the property, then go to "Assessment information" once you land on your property. The "market value" for the current year = what you will pay once you buy the house (roughly 2% of that number). That is direct from the property assessors office. The 'assessed value' is what the current owner is paying (possibly with homestead)

Last edited by thebigdo; 07-11-2013 at 10:02 AM..
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Old 07-11-2013, 11:18 AM
 
Location: Seattle, WA
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Assessed value is a bit more complicated than just neighborhood value, because the assessed value of homesteaded properties cannot increase by more than 3% each year, but it gets "reset" upon a new sale. That is why there is often a significant jump in assessed value the next year after you buy--it will be much closer to sale price. I'm guessing that the Miami-dade property tax estimator with inputting the sale price is probably the worse case scenario--the assessed value will probably be somewhat less than the sale price.

To get an idea of how close the new assessed value might be to the sales price, what you can potentially do is search for recent sales in your neighborhood in the past year on Zillow, and then look at the property tax records for those properties for the past few years.
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Old 07-11-2013, 01:43 PM
 
Location: Florida
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Property taxes are done through appraisals so it has little to nothing to do with how much you bought for. I purchased a condo in 2010, my taxes were too high, not because of what I paid for the condo, but because the appraised value was just way too high and wrong for the size and neighborhood. I appealed the taxes and they were re-assessed for 2010 & 2011 and they gave me a refund for each year. My 2012 assessment is now accurate and it looks like 2013 will be ok too.

A few years ago the assessments were all over the map and totally off base, people were appealing their assessments like crazy. Things seemed to have leveled off a bit now, but you can still compare by going to the Dade county property appraiser website and checking comps or do what hurricaneman said and check-out Zillow. I believe Zillow takes it's info from their anyway.
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Old 07-11-2013, 06:07 PM
r_k
 
Location: Planet Earth
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The sale/purchase price has little to do with how your property is assessed for tax purposes. Assessments are based on averages for your type of property in the neighborhood.
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Old 07-13-2013, 08:52 AM
 
Location: western East Roman Empire
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Quote:
Originally Posted by r_k View Post
The sale/purchase price has little to do with how your property is assessed for tax purposes. Assessments are based on averages for your type of property in the neighborhood.
Well, it is important to the extent that the purchase price factors into the neighborhood average for that type of property, so it could be more or less significant depending on neighborhood and market conditions and that property's weight in the neighborhood.

It is also worth adding that over time, with the 3% annual increase in assessed value, the assessed value tends to move towards the market value, such that even in years when the average neighborhood comparable market value does not increase or increases at a less than 3% rate or even decreases, the assessed value could increase anyway to "make up for" previous years in which assessed value was increased at a lower rate than the rate of increase in market value.

Also we have not yet introduced into this discussion homestead "portability", based on some complicated formula, but available online, which is essentially a further deduction on assessed value in addition to the basic $50,000 homestead deduction (worth around $1,000 per year in terms of property tax) for homeowners who "trade in" one homesteaded property for a more expensive one, such that it is possible to obtain, for example, a basic $70,000 deduction (worth around $1,400 per year) instead of $50,000.

So there are a lot of factors to consider: specific property, property type, average neighborhood value, general, neighborhood and specific market conditions, whether homesteaded by current owner, whether homesteaded by prospective owner, whether current and/or prospective homeowner have any portability, and of course millage rates.

These factors will also determine how property tax changes over time, and some of these factors could be unique for each individual property of a given type and neighborhood.

Nonetheless, the 2% of purchase price is a good rule of thumb for a top-of-the-range, worst-case scenario to avoid unpleasant surprises - and the same goes for insurance: in my view, if a buy decision cannot measure up to that rule for those two estimated expenses, then perhaps the prospective buyer is cutting it too thin and cannot comfortably afford the property.

To be sure, each one measures his own risk. But the problem is that too much risk-taking by too many endangers us all.

Good Luck!
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Old 07-14-2013, 09:28 PM
 
Location: 29464
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It's actually very interesting. So far as I am aware, most states including DC where we recently sold our home, one can look at the assessed value and the actual value of property on zillow/trulia (from public records) and they'll be pretty close to each other. Here in Florida, through the complicated algorithm/formula they use, I often see properties assessed at half their actual value (from comparables). The interesting thing is that although the assessed value may be lower, the tax due is actually higher here because the tax rate is higher. For example, after the homestead deduction we were paying $8500/yr on a home we bought for around $900k 4 years ago and which was assessed at that same $900, a home that we ended up selling for around $1.1m. Here, I have seen $1.3m homes in the Grove/Gables/M. Beach with current year taxes at $18k.

Here's the thing though, I literally saw two almost identical homes in size and on the same street in Coconut Grove, both homesteaded, and one guy is paying $12k and the other $21k. So there seems to be some randomness and I guess luck involved that goes into what someone ends up paying. Plus, it seems that although Coral Gables taxes at around 2.3% and Coconut Grove is taxed at around 2%, Miami taxes seem to be higher dollar wise. The reason for this I've been told, and it seems to make sense, is that although CG provides many more services to its citizens, it doesn't have to subsidize as much lower income neighborhoods.

Anyway, the whole thing seems incredibly complicated and somewhat haphazard, and its probably intended to be that way to make it difficult to contest assessments. Adding to the complexity is the concept of 'carrying over' tax credits from a previous home. (still trying to figure this one out)

In general it seems that Florida (like Texas) gets a much greater proportion of its revenue from property taxes than other states. This makes sense because that way they get to tax all the retirees who wouldn't generate income revenue for the state anyway. But as I noted in another thread, if a person does work and own their home, it appears to me that they end up paying more in additional property taxes than they ever would paying the average state income tax rate. As always, the state may be dumb, but it's not stupid.

I just don't know how people do the math, especially on a condo, because if one adds the property tax + condo fees + insurance + interest, they often come up with a number almost identical to what they'd pay to rent the exact same condo they bought, thus negating any benefit of owning over renting. In fact, in a real estate market as volatile as Miami's, if it's going to cost the same to own or rent the same condo, might as well rent and let someone else worry about maintenance and market downturns. I guess I just don't get it.
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Old 07-15-2013, 02:42 PM
 
112 posts, read 166,649 times
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I bought a condo that only had one owner before me (for 25 years). The taxes were reassessed at the purchase price...
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