What You Should Know About Real Estate Property Taxes (2)

If you're looking to move into an area, research the area's rise in
property taxes over the past several years. Many states have seen
steady property tax hikes in recent years, and residents are very
concerned. States that have low or no sales taxes on items such as
clothing may be more highly dependent on property taxes. New Jersey
and Connecticut are two states that fall into that category.

Citizens from a number of states have already begun voicing property
tax complaints. State government officials are looking for ways to fix
the growing problem, but are not having great success. States have
tried alternatives ranging from finding other sources of tax revenue
to new forms of property taxation. In Michigan, for example, all
property tax revenue goes to the state, where it is then provided to
various areas proportionately based on their needs. This system has
wealthier neighborhoods helping fund the needs of areas in
redevelopment. In most states, however, new plans to curtail the
rapidly rising property taxes are still on the drawing board.

For now, the best you can do is to have your assessment reviewed if
you're a homeowner and feel that you're paying very high property
taxes. If you're shopping for a house, be aware of the property tax
and the recent increases in the areas where you're looking.

What You Should Know About Real Estate Property Taxes

If you are a homeowner, you're probably all too familiar with real estate property taxes. If you are looking to buy a home, you need to acquaint yourself with what such taxes are all about.

Property tax is used for the needs of a specific area ? whether it's a town, county, village, or city ? to pay for everything from firefighters? salaries to road repairs to improving the schools. The tax is determined by combining the property tax rate with the assessment of the property as conducted by an authorized assessor. Therefore, if you move into a community with an eight percent property tax rate and your home is assessed at $300,000, your property tax would be $24,000 ($300,000 x 8 percent). While the tax rate is set, the assessment is subjective. The assessor can value a property based on a number of factors including, but not exclusive, to:

The sale price of similar properties in the area;

The cost necessary to replace the property;

The potential value of the property if it is used to make money through rental, sale, or other legal and approved means;

The historical value of the property.

Therefore, you can contest the assessment of a piece of property by contacting your local tax assessment office or tax board. These offices can also provide information on how to go about such a process. But first, talk with your neighbors and find out at what prices their homes are valued. Also talk with recent buyers, sellers, and realtors to get an idea of what the assessments and property taxes are for other homeowners in your neighborhood.

What Your House is Worth Using Real Estate Comps

Resources for Finding Your Home's Value

The days of calling your local realtor to find out what your home is worth are falling behind us. Real Estate Agents typically research the values of properties that are currently on the market, and others that have sold in the past in order to come up with an appropriate value for your home. This method of using a comparable market analysis has begun to see competition from several online technologies.

As technology improves, the tools we use to find the value of a property get better and better. Finding comps (comparable data) is now as easy as entering your address into a form. Beware that many of these services aren't as accurate as usng a professional, but if used together, they can help determine an approximate value range without using a pro.