What you need to know about taxes

One of the first things I do with a new home buyer is sit them down in my office in Wilton Manors and take them to www.bcpa.net. This is the Broward County Property Appraisers website. Here I will show you across the top of the page, a tab where it says Home Buyers Tax Estimator. http://www.bcpa.net/TaxCalc.asp. This is probably one of the most important lessons a realtor can teach to a new homebuyer. Whether you are buying a condo or single family home, you need to visit this page.

Location – Your Realtor Will Find the Right Neighborhood

Just because the property taxes are a certain amount when you purchase your house or condo does not guarantee they are going to be the same after your purchase is complete. The county assesses the value of the property upon purchase and adjusts the property taxes accordingly. Please read this again. The county assesses the value of the property upon purchase and adjusts the taxes accordingly.

One of the most beautiful things about homesteading a property is the property taxes can only rise a maximum of 3 percent per year.

Assume you are purchasing a house or condo from an owner who has lived in their home lets say 25 years. The last time the value of the home was assessed was when the seller purchased that home 25 years ago. From that point forward, the taxes only rose a maximum of 3 percent per year during those 25 years assuming, they had a homestead exemption. Now you come along and purchase their home. The county has the right to assess the home you just purchased and adjust its value and raise the property taxes accordingly. Surprise, all of a sudden where you thought you had the incredibly low taxes are now being raised.

To make matters worse, when you were being approved for a mortgage, the loan officer calculates the amount of escrow needed to pay the taxes based on the lower tax rate, or the old tax rate. Not only do you have higher taxes which you didn’t expect but there is also a shortage in your mortgage escrow account causing your mortgage payment to go escalate.

There is no way to avoid this other than arming yourself with knowledge. Working with an honest, professional realtor and loan officer would prepare you for this and you would understand how property taxes are assessed. If you know what to expect you can be prepared and ready when the new assessment comes.

More often than not, this is the case, however it can work in reverse as well. The seller could have purchased the home at the height of the market and paid top dollar. In this case, when your home value is assessed after your purchase, and the value has gone down, your property taxes will also go down as well.

If your realtor has not had this conversation with you, you might not be working with the right realtor. Knowledge is paramount and you need a realtor who is going to hold your hand through the entire process. I make sure all my customers, whether they are buying in Fort Lauderdale, Wilton Manors, Oakland Park, Lauderdale-by-the Sea, Plantation or any other area in South Florida I work in, have all information necessary for a smooth transaction.

To end on a positive note there are many advantages of homestead exemptions and I suggest you visit a few of the mentioned websites to educate yourself before you purchase a house or condo.

For additional information on Homestead exemptions and how they can work for you, visit: https://en.wikipedia.org/wiki/Homestead_exemption_in_Florida

If you’re looking to purchase a house or condo in Fort Lauderdale, Wilton Manors, Oakland Park, Lauderdale-by-the Sea, Plantation or any other area in South Florida, please give me a call at 954-560-8330 and let’s sit down and discuss the process.