Property tax after purchase
I am looking for advice on how to forecast property taxes for my financial model. The way that I see most brokers represent the property is to take current property taxes and keep it constant or increase it marginally. Some of the properties that I am looking at have significantly lower property tax valuations than the proposed purchase price. After I purchase the property, will the property tax valuations true up to the transaction price or do they stay relatively flat? This could have a huge impact on the P&L. Any advice would be much appreciated.
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I was just at my county's assessor's office yesterday asking about how the taxes work after a sale. I hope this helps.
When I bought my residence, the taxes tripled. I was shocked and not prepared. I want to make sure that this doesn't happen again so I'm trying to get a better understanding of how it works. What I was told was that there were exemptions on my house in place that kept the taxes low on the property. Since I wasn't eligible the taxes went up. I was assured that the sale price had nothing to do with it. It's all about the assessed value and the tax multiplier which could increase depending on things like new tax referendums or tax hikes.
What I took from the conversation was to check to see if there are any exemptions on the properties. If there are none, then there shouldn't be a big concern other then the normal small increases a person normally sees.
For Champaign county property tax lookup, one can see the taxes from the previous four years. I suppose if you could get that same data, you could average out the increase and work that into your projections.