What is the deal with Property Taxes?
This is a nationwide map of the property taxes per $1000 in property valuation across the country.
As you can see, Texas joins the Midwest and Northeast with some of the highest property tax rates in the nation.
Our saving grace of course is that we don't have a state income tax so if you choose to live in a modest house this doesn't hit you as hard.
Or does it?
I just sold a beautiful executive home for a client in Cypress. They paid just over $400,000 for the home 8 years ago. Their property tax bill was very manageable at the time they bought it.
However, the county assessor had consistently raised their valuation and in turn their property tax bill over the years so that now the property had a nearly $19,000 per year tax burden! They could afford it...but talk about annoying to have that bill hit at the start of every year!
So, the desire to downsize and lower their out of pocket tax expense brought us together.
Same house, same neighborhood...
...nearly double the tax bill.
It makes you wonder...what are all the MUDs and county assessors doing with these hugely increased tax revenues compared to what they were collecting 10 years ago?
I believe within the next 5-10 years we will see multiple bills introduced and politicians running on platforms to curb the amount of property tax money being collected in Texas.
This has begun this year in the Texas government.
It's a hot button issue because the pie chart of where the taxes go has MANY slices to it so any big changes could have unforeseen consequences on multiple different government budgets.
There are a lot of impacts that a property tax cap could have on the housing itself as well, from rising home values, which sounds good in the short term, but in the long term will actually price a lot of first time buyers out of the market.
Also the higher the property values go, the larger the tax bills will still be, even if they are capped.
Like everything else in life, whatever changes do come, there will be some consequences good and bad that no one predicted. People thought Real Estate would tank at the beginning of the COVID 19 shutdown....instead market values have since increased more than 30%
So the bottom line is regardless of what is going on in the macro, you need to regularly assess personal your financial picture and make sure you're in the best situation for yourself and your family.
If that assessment includes a Real Estate need,
I'm here to chat about it anytime.
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