When you receive your real estate property tax bill in the mail, do you complain about how high the taxes are and then grudgingly pay it. Before you pay that bill shouldn’t you investigate how the amount was computed and derived? Yes, taxes are a part of homeownership and everyone should pay their fair share of taxes, in order to support the needed services that the government provides. Unlike other types of taxes where the taxpayer determines the amount of tax owed, for real estate tax computation the government automatically and mysteriously to most folks figures your tax burden without even getting any input from you. Is this fair? There is a high probability you may be paying more than your fair share of real estate taxes.
In your mind, you probably justify paying the taxes, since you can’t fight city hall. You may recall a neighbor or friend who tried to appeal his real estate tax bill and property assessment. They went to the tax assessor’s office and used emotional arguments for trying to get tax reductions. For example, the real estate taxes are too high, I can’t afford to pay these taxes, I am retired and on a fixed income and social security, I just lost my job and can not afford to pay, I am a single mother with no other financial help, my house is not worth this amount, the millage is too high, they pay too much to the government employees, and etc.. Needless to say, they were not successful in lowering their property assessment and tax bill. These types of arguments and logic do not work.
It is estimated that only 3 to 5 percent of all homeowners ever try to appeal their assessment, the reward is worthwhile. Nationwide, more than 50 percent of those people who appeal are successful in obtaining a reduction. The key is knowing how to go about making the proper arguments and presentations, in order to overcome the tax assessor value. Look at what went on in the era from 2004 to present day. The overheated economy sent housing prices skyrocketing, with assessments following the same trajectory. The present day economy and real estate values have drastically dipped. As a result many homes and properties are no longer worth what the assessments say they are.
However, despite lower values, property tax bills are still rising. Homeowner’s may now be carrying a larger share of the tax burden. Federal and state aid to cities and towns has declined, due to the state of the economy, property owners need to prepare themselves for rapid tax increases. Taxes will continue to increase as the burden of paying for services falls to the local taxpayer. The need for increased revenue is causing tax authorities to scrutinize the current value of each property to justify higher current valuation. Homeowners need to be very vigilant about making sure that their properties are not over assessed and overvalued.
Alan Trauger is a Real Estate and Building Consultant for residential and commercial properties. Mr. Trauger has attained over 35 years of diversified experience and knowledge in construction, finance, and real estate. He has been involved in various facets of asset management, acquisitions, real estate work outs, property management, construction, inspection analysis, development, sales, leasing, and Ad Valorem tax appeal for over 25,000 single family and multi-family units and over 2.5 million square feet of commercial buildings. A Court Appointed Receiver and Expert Witness. An experienced and knowledgeable problem solver, understanding processes, and issues related construction and real estate.
Mr. Trauger’s wide spectrum of experiences, education, research, teaching, and publication of previous articles, commercial real estate market sales comparables, and textbooks enables him to assist property owners through the property assessment and tax appeal process.