Should you move because of rising property taxes?
Some people are no strangers to raising their property taxes. But if yours has increased a lot recently, you may be really upset about it, to the point that you’re now thinking about moving to another neighborhood in hopes of paying less.
But while that may sound like a good solution, it’s important to remember that property taxes are up in every area right now. And so uprooting yourself in search of a lower tax bill might not be the best idea.
An unavoidable expense
Owning a home means more than just covering a mortgage payment. It also means having to pay peripheral expenses such as property taxes. And unfortunately, these taxes can increase over time.
Property taxes are calculated by taking your home’s assessed value (which is essentially its market value) and multiplying it by your local tax rate. Your local tax rate may change, but will often remain the same from year to year. But the value of your home can change more frequently, for different reasons.
If you improve your home, such as finishing your basement, adding an addition, or building a deck, your property assessment could go up and your property tax bill could go up the same way. Likewise, if property values increase across the board, whether locally or nationally, you could end up with a higher property tax bill.
Right now, home values are on the rise nationally. And so many people are now seeing higher property taxes than two years ago. And so, if you’re happy with where you live, rushing to move to your state to ditch your new tax bill may not be a viable option. No matter where you are currently going in your state, chances are you will have a higher than usual property tax bill.
Are property taxes too high where you live?
While you shouldn’t rush to move from one neighborhood to another because of a higher property tax bill, if taxes are high in your home state or country, you may want to consider to move to another part of the country where taxes are not. t such a burden.
New Jersey, for example, has the highest property taxes in the country. It’s not uncommon for a New Jersey homeowner to pay $10,000 in property taxes a year for an average-sized home on a relatively small lot. Thus, in recent years, many New Jersey residents have abandoned the Garden State in favor of states where property taxes are not so heavy.
If it’s a move you’re considering, you could get a good tax break by moving. But if you’re planning to move 12 blocks away in hopes of lowering your property tax bill, this strategy probably won’t work.
Now, the good news is that there is always the possibility of appealing your property taxes. The process for doing this may vary depending on where you live, but if you think your property assessment is off base, it’s worth fighting it. If you win your appeal, it could mean lower taxes and less financial pressure for you.
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