Today we’re going to be going over everyone’s least favorite subject: property taxes.
If you’re thinking about buying a home, you’re probably wondering how property taxes are going to affect your homeownership.
If a property has a tax abatement in place, this will have an artificially low monthly payment. This is going to be especially prevalent if you’re buying in a building built within the last 10 to 25 years in Manhattan or Brooklyn.
Here in New York, we get some of the best services there are. This includes our police, schools, fire stations, and more. But as an accountant friend of mine once told me, we pay dearly for these great services.
"New York collects $30 billion each year in property taxes alone."
Did you know that the city of New York collects $30 billion each year in property taxes alone? If you buy within a new development three years into a tax abatement with plans of selling in five years, you should consider that your property tax bill will dramatically increase.
If someone is borrowing money to buy your home, they can borrow less of it in situations like these. Low interest rates are alleviating this fact slightly for the time being, but if interest rates climb even by 0.5% and your property tax triples, this is going to affect your equity.
So, how do you know what your tax bill will be in the future? To determine this information, consult with your real estate agent. They can help. If you make any improvements or expansions, or let time lapse between a tax abatement, your property taxes are going to be affected by value.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.