Projecting Future Property Taxes

5 Replies

Hi BP,

I have a question about estimating future property taxes. I’m looking to invest in small multi family buy and holds. My area (Buffalo Ny) has had home prices skyrocket over the past few years, as many other areas have. The issue is many of the houses were last assessed 10+ years ago. So, a house listed now for $210,000 May have an assessed value of $70,000 and property taxes of $3,000.

Now, buying the house won’t necessarily trigger a reassessment, but I know of cases where it has. Even so, eventually the house will be reassessed at the higher value.

I’ve been using a straight multiple to try and project taxes.

210,000 / 70,000 = 3 3 x 3,000 = 9,000 in property taxes.

I can’t figure out if I’m being to cautious here. I haven’t found any articles, or posts about projecting property tax increases. But, Buffalo can’t be the only area that’s experiencing this issue.

So, I’m wondering what you are doing! Are other buy and hold investors trying to project out property taxes? Using the current taxes? Or, using some average to try and split the difference?

Any advice you have would be greatly appreciated!

Jeff

@Jeffrey Morrisey

What I would do is contact your local municipality and ask when the next scheduled revaluation is. Or even better just call the local assessor or assessors office.

Where I am from, the law states the assessor must wait to adjust the values until the next full revaluation.  

@Peter B.

Thanks, I’ll make the call on Monday. 

So, it does appear that I might be way over estimating here. 

@Jeffrey Morrisey I would be curious to hear what they say. I’ve got the same concerns overs taxes on properties I’ve purchased recently.

City of buffalo assessor’s website has the tax rate posted in PDF - Look for 2017-2018 tax rate link.

Multiply your projected assessed value by the listed rate of each tax category... city, school, sewer etc and add the totals.

You will use the non-homestead rates. 

https://www.ci.buffalo.ny.us/Home/City_Departments/Assessment_and_Taxation_Department/TaxRateInformation

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