So, partly inspired by Bobby & Aleks, I'm looking around my neighborhood at homes for sale. It's a great time to buy if you're ready: prices and rates are relatively low, there's an 8,000 property tax credit available from the feds until the end of the year and there remain way more buyers than sellers. Where I live in the Cleveland suburb of Shaker Heights, there are any number houses for sale for under $100,000, which is cheap considering the median price in Shaker is nearly $200 grand and that the neighborhood has excellent public schools and other services (I don't even have to shovel my own snow or take my trash to the curb).
But all those services come with a cost and in Shaker, that cost is high. Property taxes on places that are selling like this, a rehab job selling for less than $35,000, are more than $6,100 a year. If that doesn't sound like much, consider this: a $6,100 a year tax bill would add more than $500 a month to your mortgage; on a house you only paid $35,000 for, that'd be more than double what you paid in principal and interest (assuming a 30-year mortgage at 6.5 percent).
So how much tax is too much? Would you pay exorbitant taxes to move into a great neighborhood with nice schools and services, or would you rather move elsewhere where you might get more house for the money?
1 comment:
Personally, I believe that an excellent a school system is the ultimate justification for a moderately high property tax. I know of quite of few folks who must send their children to private school because the local public schools are simply not an option. As a result they have a tution bill that far exceeds the tax bill they would have had they chosen another zip code to buy into. Moreover, since property taxes are deductible on federal taxes, in my opinion higher property taxes with an excllent a school system is the ultimate win-win.
Post a Comment