Understanding Property Taxes: What Homeowners Need to Know

1. What Are Property Taxes?
Property taxes are local taxes levied on real estate by municipalities and counties to fund public services such as schools, roads, and emergency services. The amount you pay depends on the value of your property and the tax rate in your area.

2. How Are Property Taxes Calculated?
Property taxes are based on your property’s assessed value. Local assessors determine this value annually or biannually by considering factors such as market trends, recent sales in your area, and property improvements.

For example:

• Assessed Value: $200,000
• Tax Rate: 2%
• Annual Property Tax: $200,000 × 0.02 = $4,000

3. How Can Homeowners Lower Property Taxes?

• Appeal the Assessment: If you believe your property has been overvalued, file an appeal with your local tax authority.
• Check for Exemptions: Many jurisdictions offer exemptions for senior citizens, veterans, or first-time homeowners.
• Maintain Your Property Wisely: Major renovations can increase your property’s value and, consequently, your taxes. Plan upgrades carefully.

4. Budgeting for Property Taxes
Many homeowners choose to include property taxes in their monthly mortgage payments through an escrow account. This makes budgeting easier and ensures you don’t miss payments.

Understanding property taxes can help you plan your finances and avoid unpleasant surprises. Consult with your local tax office or a real estate professional for personalized advice.

‍