Many Realtors in North Jersey Seem Misinformed about West Orange.... (Edison: buying a home, neighborhoods)

[Melland]

'Different people have different ideas of how best to spend their money. Also, it's not just $923 more per month. It's nearly double the down payment, as well."

No question....my only point is that you have to factor everything in.....including what you're paying in taxes vs. what your paying for the asset. The person in the market for the 700K home in Chatham is probably not looking at a 375K home in West Orange.

Best

[nybbler]

Originally Posted by Marc Paolella

However, taxes. That's the topic. Taxes. Taxes. Taxes. $650,000 house. $9,300 in Chatham. $21,500 in West Orange. There should be an identifiable reason why one town can provide all the services, and prestige, and state-of-the-art schools for so much less. Where is all that extra money going? Inquiring minds want to know why a local government needs to confiscate so much of the citizen's wealth.

To identify the reason, you need a basis other than the value of the house. If my house, along with every other house in West Orange, doubles in value, the West Orange government becomes not one iota more expensive to run. So if you want to find waste, you need to measure something else. For the school district, spending per pupil seems like a valid measure. For the municipality, some measure which takes into account number of households, perhaps with some weighting by household sizes and demographics.

[nybbler]

Originally Posted by Marc Paolella

Interesting. So Jersey City has professional fire and EMS and every service imaginable. So the taxes for our prototypical $650,000 residence should be off the wall, and I should be readying another scathing tirade on collectivist property tax redistribution.

But lo and behold my research shows that the taxes for that property are only going to be $8,450. Hmmmmm.

It's an Abbott district, which means the schools are mostly funded out of state income taxes instead of property taxes. But you knew that.

[Melland]

Originally Posted by nybbler

If my house, along with every other house in West Orange, doubles in value, the West Orange government becomes not one iota more expensive to run......

True, but your home doesn't go through a property reassessment each year. When I lived in West Orange, before the reassessment, the tax rate on property was over 10% because it had been so long before appraisals were done for tax purposes. Once the reassessment was complete, it showed more or less the true value of my home...and the tax rates went down...but my taxes went up. Same pie...just divided differently so to speak.

I just had a conversation with a colleague who is moving out of NYC because they are expecting their first child. He looked at WO, on my recommendation, but when he did the math he found that his mortgage payment and monthly tax bill were almost identical ($145.00 difference). That alone is a deal killer for many people....it's hard to justify that kind of payment for services....and as many don't want to discuss, school ranking from middle school on up play into that decision. If the schools ranked higher more people could deal with the taxes...in terms of people looking to move in.

Again, I enjoyed my time in WO...I loved my home, I loved my neighbors....it was a safe place for my kids....but for my family it just made no sense to continue to pay the premium for my property. I just couldn't justify it any longer.....If you can, more power to you. There are lots of things to like about WO.

[snuffybear]

Originally Posted by nybbler

It's an Abbott district, which means the schools are mostly funded out of state income taxes instead of property taxes. But you knew that.

Right, so the $ isn't even used for education.

I don't think realtors are "misinformed" -- I think they don't market West Orange because of the ludicrious taxes. They've probably had buyers back out of deals once they lost sleep over monthly payment including taxes.

[nykstevenyg]

I just felt the need to share this. Below are the Essex County effective tax rates of 2015 (just use the last column)

Assuming every house is assessed at the sale price (I know they are not just using that for example) and 20 Percent down (not including closing costs).

West Orange: 400k house (80k down 320k mortgage) : 14760 taxes

South Orange: 500k house (100k down 400k mortgage): 16345 taxes.

Verona: 500k house (100k down 400k mortgage) 10760 taxes.

While most Morris County towns have lower taxes if you commute to NYC it could be 200 more a month which is another 2400 in yearly spend. Now your shrinking your savings and loosing time commuting. When you look at a cheaper home the difference is even smaller.

Taxes suck in West Orange and almost everywhere in North Jersey! However when you look at the the total picture West Orange isn't all that bad. Especially for a realtor who doesn't even sell in Essex County to create a forum bashing a town without having any real sticking points. Below are the tax rates for all Essex County Municipalities.

DISTRICT General Tax Rate Effective Tax Rate
BELLEVILLE TWP 3.704 3.556
BLOOMFIELD TWP 3.825 3.616
CALDWELL BORO TWP 2.587 2.447
CEDAR GROVE TWP 2.174 2.146
EAST ORANGE CITY 4.978 4.422
ESSEX FELLS TWP 2.025 2.020
FAIRFIELD TWP 2.019 1.997
GLEN RIDGE TWP 3.426 3.126
IRVINGTON TWP 5.423 4.623
LIVINGSTON TWP 2.463 2.319
MAPLEWOOD TWP 3.600 3.231
MILLBURN TWP 2.105 1.835
MONTCLAIR TWP 3.526 3.002
NEWARK CITY 3.309 2.902
NORTH CALDWELL TWP 2.230 2.104
NUTLEY TWP 3.316 3.048
ORANGE CITY TWP 4.653 4.208
ROSELAND BORO 2.223 2.043
SOUTH ORANGE VILLAGE TWP 3.739 3.262
VERONA TWP 3.000 2.698
WEST CALDWELL TWP 2.334 2.390
WEST ORANGE TWP 3.817 3.698
2015 General Tax Rates
Essex County

[Marc Paolella]

Originally Posted by nykstevenyg

I just felt the need to share this. Below are the Essex County effective tax rates of 2015 (just use the last column)

Assuming every house is assessed at the sale price (I know they are not just using that for example) and 20 Percent down (not including closing costs).

West Orange: 400k house (80k down 320k mortgage) : 14760 taxes

South Orange: 500k house (100k down 400k mortgage): 16345 taxes.

Verona: 500k house (100k down 400k mortgage) 10760 taxes.

While most Morris County towns have lower taxes if you commute to NYC it could be 200 more a month which is another 2400 in yearly spend. Now your shrinking your savings and loosing time commuting. When you look at a cheaper home the difference is even smaller.

Taxes suck in West Orange and almost everywhere in North Jersey! However when you look at the the total picture West Orange isn't all that bad. Especially for a realtor who doesn't even sell in Essex County to create a forum bashing a town without having any real sticking points. Below are the tax rates for all Essex County Municipalities.

DISTRICT General Tax Rate Effective Tax Rate
BELLEVILLE TWP 3.704 3.556
BLOOMFIELD TWP 3.825 3.616
CALDWELL BORO TWP 2.587 2.447
CEDAR GROVE TWP 2.174 2.146
EAST ORANGE CITY 4.978 4.422
ESSEX FELLS TWP 2.025 2.020
FAIRFIELD TWP 2.019 1.997
GLEN RIDGE TWP 3.426 3.126
IRVINGTON TWP 5.423 4.623
LIVINGSTON TWP 2.463 2.319
MAPLEWOOD TWP 3.600 3.231
MILLBURN TWP 2.105 1.835
MONTCLAIR TWP 3.526 3.002
NEWARK CITY 3.309 2.902
NORTH CALDWELL TWP 2.230 2.104
NUTLEY TWP 3.316 3.048
ORANGE CITY TWP 4.653 4.208
ROSELAND BORO 2.223 2.043
SOUTH ORANGE VILLAGE TWP 3.739 3.262
VERONA TWP 3.000 2.698
WEST CALDWELL TWP 2.334 2.390
WEST ORANGE TWP 3.817 3.698
2015 General Tax Rates
Essex County

No, when you look at the total picture, the taxes in West Orange are MUCH WORSE than most other towns. Of course, the disparity is less pronounced when limiting one's comparison to Essex County municipalities, since by and large all Essex County municipalities have ridiculous and confiscatory taxes.

Next, it is not necessary to sell in any particular town to do an effective tax comparison. In fact, you don't have to be in real estate at all. Anyone can do it. And when anyone does it, they can see that the worst abuse will take place in Essex County, and especially in certain towns like West Orange.

I would expect when I see the dazzling taxes levied in West Orange that I would be living in a state-of-the-art community with profligate services, top tier train-based commuting, prestige, a first class downtown, and exemplary schools from K to 12.

I'm not seeing that in West Orange, so if I were shopping for a home, I would not exchange my hard earned money for homes in any town where the policy was to take my hard earned money and either A: Give it away, or B: Throw it away.

However, you are free to do just that. But do it with your eyes open.

By the way, your data is not presented well, and leads to no conclusion, or a wrong conclusion. For example, you incorrectly implied that the taxes for a $400,000 home in West Orange would be $14,760. It's bad, but it's not that bad. The typical taxes for a $400,000 home are going to be about $12,400. Still an abominable outrage, and given the fact that West Orange tax increases have been running far in excess of the inflation rate for several years, they will probably be $14,760 before very long. But they are not that as of today.

I ran Westfield. Downtown, Check. Train, Check. Schools, Check. Prestige, Check. Services, Check. My taxes for a $400,000 home would be more along the lines of $9,500, and I would be investing more wisely, and in an area with a better chance for appreciation, and with a reduced chance of deflation when the market turns since quality train towns suffer less in a bad housing market.

"Oh you don't know what you're talking about. You get way more house in West Orange"...

No, you get some more cubic footage. I don't limit what I "get" to the volume of the improvement. I look at everything. And so do all buyers.

[ansky]

Originally Posted by snuffybear

Right, so the $ isn't even used for education.

I don't think realtors are "misinformed" -- I think they don't market West Orange because of the ludicrious taxes. They've probably had buyers back out of deals once they lost sleep over monthly payment including taxes.

You read that post wrong. West Orange is NOT an Abbott district. His post was referring to Jersey City which is an Abbott district.

[ansky]

Originally Posted by nykstevenyg

While most Morris County towns have lower taxes if you commute to NYC it could be 200 more a month which is another 2400 in yearly spend. Now your shrinking your savings and loosing time commuting. When you look at a cheaper home the difference is even smaller.

That is an excellent point, and one of the main reasons we chose to live in West Orange. The location is great. I work in Essex County so I have a nice 10-minute drive to work. My wife works in Hudson County and has a nice 20-minute drive to work. I have several co-workers that live out in Morris County and every day they come to the office complaining about how it took them over an hour to get to work because of traffic on route 80. You can't put a price tag on wasted time and stress from commuting.

[nykstevenyg]

Originally Posted by Marc Paolella

No, when you look at the total picture, the taxes in West Orange are MUCH WORSE than most other towns. Of course, the disparity is less pronounced when limiting one's comparison to Essex County municipalities, since by and large all Essex County municipalities have ridiculous and confiscatory taxes.

Next, it is not necessary to sell in any particular town to do an effective tax comparison. In fact, you don't have to be in real estate at all. Anyone can do it. And when anyone does it, they can see that the worst abuse will take place in Essex County, and especially in certain towns like West Orange.

I would expect when I see the dazzling taxes levied in West Orange that I would be living in a state-of-the-art community with profligate services, top tier train-based commuting, prestige, a first class downtown, and exemplary schools from K to 12.

I'm not seeing that in West Orange, so if I were shopping for a home, I would not exchange my hard earned money for homes in any town where the policy was to take my hard earned money and either A: Give it away, or B: Throw it away.

However, you are free to do just that. But do it with your eyes open.

By the way, your data is not presented well, and leads to no conclusion, or a wrong conclusion. For example, you incorrectly implied that the taxes for a $400,000 home in West Orange would be $14,760. It's bad, but it's not that bad. The typical taxes for a $400,000 home are going to be about $12,400. Still an abominable outrage, and given the fact that West Orange tax increases have been running far in excess of the inflation rate for several years, they will probably be $14,760 before very long. But they are not that as of today.

I ran Westfield. Downtown, Check. Train, Check. Schools, Check. Prestige, Check. Services, Check. My taxes for a $400,000 home would be more along the lines of $9,500, and I would be investing more wisely, and in an area with a better chance for appreciation, and with a reduced chance of deflation when the market turns since quality train towns suffer less in a bad housing market.

"Oh you don't know what you're talking about. You get way more house in West Orange"...

No, you get some more cubic footage. I don't limit what I "get" to the volume of the improvement. I look at everything. And so do all buyers.

Good luck getting a 400k house in Westfield. A 400k house in West Orange is probably like 550k in Westfield. Now your tax difference is much smaller and your mortgage is much higher due to cost and down payment is much higher. Also West Orange taxes have increased at the same rate as other towns. I don't know where you get the idea it went abnormally higher. I am comparing it to Essex County. Were also not comparing west orange to high end prestigous towns like Saddle River.