Wednesday, January 9, 2008

Why Are My Property Taxes So High?

The taxes on your “real” property (what the Assessors call your home) are based on the taxable value of your home and the millage rate for your area.

I’ve written previously about the taxable value of your home.

If you are interested in local millage rates, here is the definitive source for 2006. As soon as the 2007 publication becomes available, I will publish it here. Washtenaw County property tax rates begin on page 146.

The millage rate on which your taxes are based is made up of a composite of the amounts charged by the state, county, township, intermediate school and school district. Any requests for millage increases are voted on by us, the voters.

So what will happen to property taxes in 2008?

Could there be a silver lining to the increasing number of foreclosures in Michigan? Maybe. Maybe not.

Last year, The State of Michigan changed the laws allowing foreclosures to be taken into consideration in property tax assessments. Previously the depressed sales were disallowed as aberrations.

The State Tax Commission also changed rules allowing sales studies to be based on one year of sales instead of two. The two year ruling had helped to keep assessments low during periods of rapidly increasing sales prices, but it also kept assessments high during periods of rapidly falling prices.

For more information read the article from the Detroit Free Press.

Combined, these two changes could have a significant impact on assessments, but most home owners who have been in their homes for more than a few years will not see any difference in their taxes because of the current cap on property tax increases.

The State of Michigan also provides a website where you can get an estimate of your property taxes. I haven’t tried this website, so I can’t attest to the accuracy of their estimate.

Finally, here’s a different way of looking at the value of your home.

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