Serious question for all of us baby boomers. In this market, (meaning the housing market), does it pay for any of us to try to appeal or abate any of the home taxes if we've had an upgrade or if we've done some minor work to our homes?
I asked this question because, I'm in that situation where I had to make a decision to buy a new house, (upgrade), or fix up my existing home, (which is also an upgrade). In my situation, it was just easier to fix up my existing home, especially since I could take advantage of still having a low interest rate on my existing mortgage. If I were to buy a new home, it would have required me to make that decision prior to the interest rates jumping up. The other situation that was going on was, if I sold my house, in this market, (even though I know I would have got a good price for it), I don't believe I would have been able to achieve buying the new house without running into a couple of months of disarray.
Basically what it boiled down to was, if you didn't have cash, you were essentially missing out on taking advantage of the market. That all being said, in my situation it was just easier and less expensive to do the home upgrade. In addition, for me, the advantages of staying where I'm at and fixing up the house was, I was able to keep my mortgage at the rate I got back in the pandemic era.
This process, (in my situation), due to the pandemic and needing a bulk variance in order to get the work done, took approximately 2 years. In this two-year period, not only has the house and market continue to boom but, (as we all know), obviously the interest rates have doubled since the pandemic. With that in mind, even if I did nothing as far as upgrading my house the price or the assessment that's on the property would have gone up because of the market.
Under normal circumstances, the taxes would have gone up just in general. Now that I have done an upgrade to my home, this gives the county a reason to reassess my house and actually reassess it at today's market value. I am in no way not denying that I should have a reassessment, due to the upgrade, but I am a little upset because if the market was not so hot, the reassessment would not be as high as it is.
In my opinion, this is almost as if we're giving a blank check to the county or the township, for them to raise our taxes based on market value, when prior to the pandemic, the assessment and or prices of the homes would never have been this high. To those that say, "well, just appeal the taxes", keep in mind the other assessments are based on comparable sales of current real estate properties not comparable assessments of existing properties.
To explain this better this is the current situation. If three houses in the area sell for $500,000 but your house is assessed at $300,000 your taxes most likely will stay the same, Even though your house may be worth $500,000. Now, do a simple upgrade, (like I did), and my house which was assessed at $300,000 prior to the pandemic, is now worth $350,000 because of the addition. It would make sense that I would be paying taxes on a $350,000 home instead of a $300,000 home. But no, (in the voice of John Belushi), the county and the township look at the houses that have sold for $500,000 and say oh, your house must be well over 350,000 so we're going to tax you more. ☹️☹️☹️
Because of this, it really has me thinking whether or not, by upgrading our homes, is really worth it for us baby boomers? The reassessment is just enough to make me say, should I try to appeal this or should I just let it go? By the way the assessment valuation starts at $150,000. My upgrade was way less than that, (seriously less than $80,000 including the cost over runs). That all being said, just about every home that has sold in my area went easily for $50,000 to $100,000 over the asking price. It just seems as if I did a appeal and asked for a reassessment, I really would get whacked with the taxes, which would then make me have to rethink about my living situation,☹️☹️☹️.
