What factors affect your residential property taxes?

On Behalf of | May 21, 2020 | tax law | 0 comments

Getting your property tax assessment may be something you have come to dread, especially if your taxes seem to steadily increase. However, it is possible to appeal your property tax assessment and potentially reduce the amount you have to pay. 

There are several different factors that affect your property tax assessment and the amount of your tax bill. Understanding these factors may help you avoid decisions that increase your property tax assessment unexpectedly. 

Sales of nearby homes 

Your property taxes may increase when your local real estate market heats up. According to Architectural Digest, increased homes sales may lead to higher assessed values of other houses in the neighborhood. An assessor may use the sales price of homes in your area when determining the assessed value of your home. 

Home additions 

One element you do have control over in terms of your property value assessment is your home’s condition. Building an addition onto your house may drastically increase its assessed value, which makes your tax bill larger. Additions increase the square footage of your home, which is a benefit in terms of the resale value and your equity. However, more square footage will likely increase your tax assessment number as well. 

Other renovation projects 

Even small home improvement projects may lead to an increase in your home’s assessed value. Projects that upgrade the exterior of your home may be especially impactful on your property taxes because a house’s curb appeal sometimes changes the assessed value. Architectural Digest states that even minor renovations, such as augmenting a half bathroom with a new shower, may lead to an increase in your home’s assessed value.