City Tax Assessment After Purchase

14 Replies

When buying a house for a price that is higher than the current assessed tax value would the city always raise the taxes up to match the new purchase price? I was wondering if this varies based on where you are buying the house?  The house I am looking at is in Buffalo, NY. 

I would say they will catch it on the next appraisal period or at least they seem to in Texas.  The counties shift the agents around to different parts of the county and they are always out looking for ways to bump the appraised value up.  In my county they use Google Earth to measure everything from space then if they think there is something different from their records they will go out and look at it in person.  I found them crawling around measuring the back porch on one of my properties because using Google Earth they calculated the square footage of the open concrete porch to be five square feet more than on their records.  Now this porch had been setting there for about 20 years.  I can't see them not catching something as easy as a higher sales price since it all goes to the appraisal office from the county clerk.

in our town, any property that sells, means the buyer gets a letter to confirm the price and the intended use of the property. They then revalue the property for a new assessed value. Wonderful.

We had letters from the tax assessor this year asking about a couple of houses we bought this year. There were several questions such as date of purchase, are you living on the premises, purchase price, did you think the price was fair(!), etc. The letter said that the information was requested (not required) so we answered some of the questions, but not others. I'm certainly not going to help them raise my taxes if I don't have to. :-)

Speaking From Past Experience, it depends on the area in Buffalo. The facts of the matter if you pull permits, they're going to look. If you list the house for resale, they're going to look. The City is Kind of Laid Back with assessments, but the surrounding areas....they're going to increase in. They want that money. 

Thanks for the insight everyone!

On the flip side - if you buy a house less than assessed value - can you just submit that to the town and have the taxes decreased?

@Connor Smith  

I am a real estate tax consultant based out of Indianapolis. If you purchase a property for more than the assessed value, the jurisdiction will almost always chase that deed that is filed with its recording office.

This all depends on the county/township, however. Some do it almost immediately, while the bigger counties could take up to two years to adjust the newer value.

Originally posted by @Ceril S. :

On the flip side - if you buy a house less than assessed value - can you just submit that to the town and have the taxes decreased?

We have had some success with this in some cases in some counties but not others. There doesn't seem to be a whole lot of rhyme or reason to when they will do reductions and when they won't. It seems to be much easier to get reductions in FSBO transactions than ones from HUD foreclosures. Over all it is worth trying.

Not usually, but unfortunately it depends. Most local property tax assessors want to verify where sales are reflective of the current market (or their effective date of valuation for assessment purposes). Once they have found all the sales that they believe are reflective of market value they will change ALL the assessments in a neighborhood or market area to reflect changes in market value, NOT just the properties that sold. That's why it's important @Sylvia B. to cooperate with your local assessor.  Answering some questions posed by the assessor could have disqualified your sale from their consideration, say because your purchased it as a distressed property.  Also keep in mind that banks, mortgage insurance, and regulatory agencies often verify or compare their own data with assessment records. Sometimes homeowners omit data that the assessors asked for only to find out later that it raises a red flag with an insurance company or lender (or auditor checking on a lender's portfolio). 

I invest in two neighboring counties. (buy and hold) 

One lowered my tax assed value to the purchase price without me even asking or filling out a form.

The other sends me a questionnaire, Disregards the sale price if it is lower than thier assesed value (but reasseses immediately if it's above) 

Short answer to your question,  they will probably raise it either now or eventually, but it's very county/city specific. 

@Connor Smith  

How and when properties are reassessed varies by county and is determined by the local assessors office. Call the tax assessor wherever you are buying and ask them what their procedure is. It's going to be different in all counties.

Hi @Connor Smith   - I have, as yet, limited experience, but the two times we purchased property, it seemed to take about two years for the assessment to catch up to the purchase price.  However, we're talking 7 and 12 years ago for my experiences (that will hopefully be changing if our 4-unit goes through next month).   I could be wrong, but my opinion is that with all of the activity going on in the Buffalo area in the last two years, I can't imagine the city would be getting any faster...I would guess the opposite...just my two-cents.

@Connor Smith  

Actually, I have a little more data.  I realized I could look up the double we sold almost exactly two years ago - it is still at the last assessed value that it was when we still owned it, not at the price we sold to the current owner.  Also checked out a family members address (that moved in 3 1/2 years ago) - still assessed at the old rate.  Again, this doesn't necessarily mean it'll take that long, but at least you have some might get 2+ years at the current assessment.....fingers crossed!

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