why are property taxes so variable in Cleveland?

3 Replies

I've been closely looking at properties in the Cleveland area. One thing that I have noticed is that taxes vary widely from city to city, and even within a single city can vary from house to house. How are property taxes determined? It can really make or break cashflow...

Nicole

So buy in the city that makes sense?

Taxes can be debated on q1 you need to justify that the city has over valued your property

The tax rate (%) should be consistent across a city in the Cleveland area (I believe) but does vary from city to city. The tax rate can actually vary within a city here in the Columbus area because our school district lines do not always follow the city boundaries. So, for example, there are houses that are in the city of Columbus (for government purposes), but within the city of Hilliard school district. Those houses would pay the base Columbus rate plus the Hilliard school rate, which would be different than the base Columbus rate plus the Columbus school rate.

The value of the house varies, of course, based on the tax value assessment of the house. The county auditor is the one who sets the house value. As Federico said, you can debate the value of the house with the auditor if you feel it's over-valued. You just need to have some proof, like an appraisal. I know that people win these debates quite often (or at least get some concession). If you feel the house is under-valued in its tax assessment, I'd be cautious in counting on it staying that way. The value will likely rise with the next tax assessment (generally done every few years). 

Disclaimer: I am not a real estate investor yet, but I'm a lifelong resident of Ohio and familiar with our crazy tax systems here.

Taxes in Cuyahoga county are ALL over the place, but generally fairly high. In certain areas higher rents can help compensate for this. The surrounding counties generally have substantially lower tax rates with income opportunities as well. I would try not to get to caught up in the tax rates and just make sure your factoring in the taxes into your ROI. Feel free to reach out if you have more questions. Good luck!

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