How much are property taxes on a 510,000 home?
After the mortgage the next biggest cost is usually
property taxes. Property taxes vary based on the municipality. The big thing to remember is that they often increase significantly after buying a house. This is because the taxable value is usually reset to reflect the new purchase price. To estimate your new taxes, find your local property tax rate and multiply by your home value.
Pay attention to how taxable values are recorded. Many times the taxable value will be reset to 50% of the actual purchase price. For example, let's say that you buy a house for 510k. The taxable value might be recorded as 255,000. Then find your local property tax rate. This is often recorded as mills. 1 mill is equal to 1/1000 of a dollar. In this scenario we use a tax rate of 40 mills.
Purchase Price |
510,000 |
Taxable Value |
255,000 |
Millage Rate |
40 Mills (4% of taxable value) |
Property Taxes |
10,200 |
While assessed values don't always reflect the new purchase price, be prepared to pay more property taxes than the previous owner.