The housing market continues to suffer - from plummeting sales to plunging prices. But guess what? Property taxes are not suffering.
Since 2006, housing prices have fallen around 18% a year, but property taxes are rising 7% a year. The census shows between 2006 and 2008, the amount of money state and local governments collected from property taxes jumped from $364.5 billion to nearly $410 billion. Property taxes account for almost three-quarters of all the tax revenue collected by local municipalities.
And it matters where you live - New York and New Jersey - I'm talking to you now! The median annual property tax bill through 2009 is about $1,800. But not if you live around New York City - Hunterdon County, New Jersey residents pay a median amount of more than $8,200 a year. Same goes for Nassau and Westchester Counties in New York.
If you want the lowest property taxes you'll have to move to Alaska, where the tax burden is only a little over $100 a year. Nationally property tax as a percentage of a home's value is about 1%, but not if you live in Western New York State. For example in Orleans County, between Niagara Falls and Rochester, the percentage is greater than 3%.
There are ways to lower your tax bill, besides moving to Alaska of course! Governments base property taxes on assessments - and they're not always accurate. The National Taxpayers Union says a stunning 60% of properties are over-assessed.
There are easy ways to find out if you're one of that 60%. Some homes are assessed by their market value, others by how much you could sell it for. Those are two very different amounts.
To find out what your taxing authority uses just call the assessor's office or check it out online. And while you're there ask for your property record.
That contains basic information like the square feet of your house, number of rooms, etc. It's important to check this record. This is where a lot of the errors occur because assessors don't have access to the inside of your home and it's based pretty much on estimates taken from your front lawn.
If you find these mistakes don't be afraid to file an appeal. Do not just go to the office and yell at somebody—make it an official challenge.
Rules for appeals vary from state to state, but most require a written statement to the county on why things are inaccurate. As long as you have hard evidence, including photos, you have a great shot at getting the price tag down.
Finally, grab those tax exemptions - while you still can. Many states and local governments offer breaks to senior citizens, veterans or those with disabilities. But you have to apply for them... again just go to your assessor's office.
This is one issue that continually has me fired up - as a homeowner in one of those top paying counties no less.
But it shouldn't be that way. We are losing value in our home more and more each day - but we're paying more to the government?
On what planet is that fair?