Property Tax Time....
It's that time of year again...tax bills have been mailed and many homeowners elect to pay their taxes in full by year end and deduct them. There may be an indication of assessed and fair market value on th bill.....and then the magic number the homeowners pay the taxing authority .
Whether it is an assessment, an appraisal gotten for insurance...for a home equity loan....the "fair market" value that the taxing authority uses... is a means to an end. The end result is that government and the services that are funded by taxes need a source from which money is collected. The "value" of the house is not whatever number is used on the bill....and in some areas there is no reliable/recognizable correlation between any value and the sale price of a home. In many areas throughout Wisconsin....no homes have sold for the "assessed value"....there was a time when boasting a home was priced "below assessed value" caught the eye of bargain buyers everywhere...that is no longer eye catching...it is the norm, not the unusual.
Sellers....please don't "bank" on what the tax man says for a price....enlist the services of a qualified real estate agent...who can show you actual sold values. It won't matter what the tax man says...or want you believe the house is worth. The reality is that the homes on the market which may include short sales sold below the market, bank owned and foreclosure properties are the new comparables for sold homes in your area. Homes that fall into these categories need not be in terrible condition....that is what some homeowners believe. It just means that for whatever reason, the sellers financial condition did not allow them to keep the house.
If a sale is in your future...it is a wonderful time to "move up"....if you want a price you believe you have to have based upon what you paid, the improvements you made....what the tax man says....this is not the time...and the crystal ball says....it will not be, for quite a while....Real Estate is local....turn off the media and consult a knowledgable local realtor....you want the truth...you deserve nothing less. Know that realtors work on commission...if you are given a lower price than you expected or desired...and the realtor has shown you comparables that meet the suggested list price, no realtor wants to make less money....they are being ethical and honest. The choice to sell at a price the market dictates...that a buyer's appraiser will agree to....and a lender will finance, are up to the market...the market always decides.
Sally K. & David L. Hanson, ABR, CDPE, CSS, e-Pro,ILHM, REDS
There is a real and growing anger over the tax man not changing your rates DOWN based on lower values. It seems very unfair and I think we will hear more about this in 2010
Hi Sally:
In NJ, our tax bills go out in August and are situated to be paid on a quarter basis only.
It's interesting how different areas handle taxes...
Anger everywhere Charlie....the reality is that it still will cost a taxing authority $X to run the gov't even with careful spending....snow has to plowed or garbage picked up..police paid...fire stations staffed...and it all costs money...so paying someone....at further cost to "adjust" the number will only increase the rate...
Well said! It is hard for sellers to understand this and once it is explained clearly to them I find they tend to become angry. Not at me but with their taxes. I hope this is read by everyone.
It's just a method to keep taxing authorities running their business...cut taxes, keep services, don't cut employees....maintain property values....can't all be done at the same time in the same way everyeone would like them....
We get to pay our property taxes in two installments, December 10 and April 10. I've been lobbying for decades to change that because who has money on December 10 and April 10 to pay property taxes? We're too busy buying Christmas presents and paying income taxes!
Thanks Russel...hope you are feeling better and you all have a happy, healthy holiday !
The only time the tax assessor here uses fair market value to determine property taxes is when a home sells. After that, it's simply an increase of 2% each year.
California is of course in another country...:)