Our Property Taxes Went Up 25%

Our Property Taxes Went Up 25%

A few days ago I received our property taxes for 2015-16. Initially, when I looked at our taxes I was expecting a slight increase from last year. However, when I looked I had to do a double take with how much they had increased. At first, I was sort of dumbfounded and upset, but when I looked a little deeper I realized why they had gone up so much.

When we bought our house the assessment on the house over the past few years had been actually quite low. In fact, the house was assessed about $40,000 cheaper than what we had paid for the house. Our new property tax bill assessed the house at what we paid for it, which explains the 25% increase.

Now I could contest this a bit if I wanted and I am going to talk to our mortgage company about this. Just because we bought the house at a certain assessment, doesn’t mean the way the city values the property should be at its current assessment level. I mean for an assessment to go up almost 25% in one year that is a pretty hot real estate market and while property values have gone up year over year they certainly haven’t gone up that much.

At the same time, the assessment on the house previously one could argue was a little low. I am not sure how they assess the value of the house, but the assessment the city has provided is actually much lower than overall value of the property.

So while I am going to inquire about checking into “reassessing” the property for tax purposes I am not totally upset that our taxes went up that much.

The only thing that it does it that it screws up our escrow payments for a short bit. Because my bank had been working under the old property tax assessment I am going to have to fork over a couple of hundred bucks to cover the quarterly tax payment that is coming up. Not necessarily a big deal, but a nuisance nonetheless.

How much have your property taxes gone up? How have you dealt with it, if at all?

8 thoughts on “Our Property Taxes Went Up 25%

    1. It is definitely owner-occupied. Anyone owning a rental property must pay through the nose.

  1. Great post, Jason. In Fargo, we had high property taxes, but the return on those taxes was pretty good. Lots of parks and rec programs, clean streets, proper maintenance, etc. I don’t know how it is in the east cost, but now that I live in Bottineau where our property taxes are about half of what they were in Fargo for the same priced house, I strongly favor a higher property tax rate. Our streets here are not as well maintained, the curbs are broken and crumbling and there’s a lot of dilapidated buildings in the town. Sure, in Fargo we paid high taxes ($4k on a $200k house) but it was so worth it.

  2. It is definitely owner-occupied rate. And you are right, owning rental property here must be a true pain in terms of taxes.

  3. Jason,

    How long ago was the assessment on which your previous tax bill was based? Also, did the mill rate go up as well?

    BTW, it’s not unusual for your property to be “re-assessed” based on purchase price. A similar thing happened to me a number of years ago when I bought a house in CT. That being said, it is an unpleasant surprise.

    1. The previous assessment was for 2014 and the rate didn’t go up. I certainly get that being “re-assessed” is not unusual. It just bites. But it could be worse.

  4. Hi Jason! That happened to us too last summer (we bought our house in October , 2012) and bumped our mortgage payment up by $200/month!!! (We escrow our taxes too). At first we just sort of accepted it and didn’t do anything, then having considered all the other bills and me only working part-time at the moment, I decided to see if there’s anything we can do about it, like possibly refinance (I am sort of he financial brain in our family so my husband trusts my decisions). So to make a long story short, I went to see our mortgage broker and found out that, while refinancing would not make sense for us at the moment, we do qualify for a tax exemption that our town offers to first-time homebuyers! As a result , our payment got a monthly reduction of $100, which isn’t much but still helps with other bills. That’s our story..

    1. Wow, val that is great! And I certainly can understand how taxes can kind of screw with your budget. It actually didn’t effect us that much because I was paying an extra $50 a month on our mortgage to get it to an even number (I like rounded figures for account keeping), but that extra payment now goes to taxes. So it wasn’t so bad it just kinds of screws with the accounting a bit.

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