Property Taxes

As 2011 quickly arrives, we can easily say that housing values have declined in 2010. Certainly values are less than the previous two years. We are in a period of leveling off and in some markets, price increases!

As you all know, at all levels of government, our elected officials are having difficulty in generating revenue. Most local governments use property taxes as their primary revenue source in setting their yearly budget. The property tax rate is set yearly by local municipalities. The tax rate and the real estate assessment of a home determine the amount of the real estate tax to be paid by homeowners.

In many locations, the last reassessment took place before the peak or during the peak of the market. It is likely the current real estate value will be less than the previous assessment. Thus, will the real estate tax be lower – most likely not!! The tax rate will most likely be increased to maintain current local government spending levels.

Therefore, homeowners have two chances to ensure local government is not maintaining current spending habits on the backs of homeowners.

1. Reassessments by local government should be challenged if the new assessment value does not reflect the current market value in your area. If the assessment of your home is higher than the last evaluation, their assessment should be challenged and an appeal filed. In most cases, the appeal is a form letter substantiated reasons for you appeal.

2. Become involved in the local government especially at the time of setting the local government budget for the next year. Local government must generate revenue to maintain current spending levels. To achieve this goal with property values declining, politicians will raise the property tax rate.

These challenges are undertaken at two different points in time and their actions will have a direct impact on your own personal household budget. Become an activist for homeowners which currently shoulder the burden of local government spending.