Estimating property taxes for analyses

San Diego, California
Real Estate Deal Analysis & Advice
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Estimating property taxes for analyses

Mary Ainsworth
Lender · San Diego, CA · Member since 2022 · 235 posts · 94 votes

Hey! I'm just learning how to analyze deals and I'm confused about how to estimate property taxes. 

option 1: someone told me that property taxes are about 1.25% of a property's purchase price

option 2: the mortgage estimation on the MLS + property tax estimator on the MLS

Which of these 2 options would be more accurate?

Thank you!!

2Reply
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Nate Sanow
I​nvestor & Agent · Tulsa, OK · Member since 2016 · 1k+ posts · 1k+ votes
3y

In my market it is public record in the county assessor website. Hopefully yours is easy to access?

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  • Chris McFarlandPro Member
    Real Estate Investor · Berkley, MI · Member since 2014 · 6 posts · 2 votes
    3y

    Hello Mary,

    I recommend contacting the City Assessor and asking them what the new taxes will be at a specific purchase price.  They can calculate the exact taxes for you.  I find this especially helpful when a property has not been bold in a very long time.

    2Reply
  • Dan Garrigus
    Lender · San Diego · Member since 2022 · 57 posts · 28 votes
    3y
    Quote from @Mary Ainsworth:

    Hey! I'm just learning how to analyze deals and I'm confused about how to estimate property taxes. 

    option 1: someone told me that property taxes are about 1.25% of a property's purchase price

    option 2: the mortgage estimation on the MLS + property tax estimator on the MLS

    Which of these 2 options would be more accurate?

    Thank you!!


     Hi Mary!

    Hope you're having a great Monday! Great question by the way. We use the 1.25% as a good rule of thumb when preapproving our clients as we do not know where our buyer's property will be. 

    With that said, if you're just estimating what a properties taxes will end up being then the 1.25% figure will work just fine. Most cases that rate may be a bit high, making your overall taxes for the year a bit cheaper. Thats a win for you.

    Here is a link that I think can bring you great value. San Diego Taxes

    Hope that helps!






    1Reply
  • Nicholas Coulter
    Real Estate Agent · Southern California · Member since 2019 · 681 posts · 281 votes
    3y

    @Mary Ainsworth You can call the city assessor to get that info! This is a better option to me than the generic because its exact, however if you use general % try and go a little high to play it safe. 

    1Reply
  • Nate Sanow
    I​nvestor & Agent · Tulsa, OK · Member since 2016 · 1k+ posts · 1k+ votes
    3y

    In my market it is public record in the county assessor website. Hopefully yours is easy to access?

    3Reply
  • Mary Ainsworth
    OP
    Lender · San Diego, CA · Member since 2022 · 235 posts · 94 votes
    3y
    Quote from @Dan Garrigus:
    Quote from @Mary Ainsworth:

    Hey! I'm just learning how to analyze deals and I'm confused about how to estimate property taxes. 

    option 1: someone told me that property taxes are about 1.25% of a property's purchase price

    option 2: the mortgage estimation on the MLS + property tax estimator on the MLS

    Which of these 2 options would be more accurate?

    Thank you!!


     Hi Mary!

    Hope you're having a great Monday! Great question by the way. We use the 1.25% as a good rule of thumb when preapproving our clients as we do not know where our buyer's property will be. 

    With that said, if you're just estimating what a properties taxes will end up being then the 1.25% figure will work just fine. Most cases that rate may be a bit high, making your overall taxes for the year a bit cheaper. Thats a win for you.

    Here is a link that I think can bring you great value. San Diego Taxes

    Hope that helps!







     Thanks Dan! Very good to know I'm using a fairly accurate number at least in these initial analyses :) 

    1Reply
  • Mary Ainsworth
    OP
    Lender · San Diego, CA · Member since 2022 · 235 posts · 94 votes
    3y
    Quote from @Chris McFarland:

    Hello Mary,

    I recommend contacting the City Assessor and asking them what the new taxes will be at a specific purchase price.  They can calculate the exact taxes for you.  I find this especially helpful when a property has not been bold in a very long time.


     Thanks Chris! I will look into calling them. So as long as the properties I'm looking at are in the same city, the property taxes only change depending on the property's purchase price? 

    1Reply
  • Mary Ainsworth
    OP
    Lender · San Diego, CA · Member since 2022 · 235 posts · 94 votes
    3y
    Quote from @Nate Sanow:

    In my market it is public record in the county assessor website. Hopefully yours is easy to access?


     I will look into the county assesor in my city then! Thanks Nate :)

    1Reply
  • Mary Ainsworth
    OP
    Lender · San Diego, CA · Member since 2022 · 235 posts · 94 votes
    3y
    Quote from @Nicholas Coulter:

    @Mary Ainsworth You can call the city assessor to get that info! This is a better option to me than the generic because its exact, however if you use general % try and go a little high to play it safe. 


     Got it, thanks Nicholas!

    1Reply
  • Jeff Costa
    Member since 2021 · 166 posts · 113 votes
    3y

    You should have access to a local assessors website that you can pull actual 2022 numbers from. Its better to use actuals than estimates to improve the accuracy of your pro-forma.

    1Reply
  • Curtis Mears
    Property Manager · Raleigh, NC · Member since 2014 · 728 posts · 596 votes
    3y

    @Mary Ainsworth

    Go to the county tax website. They will give you the tax paid.

    2Reply
  • Jeff CopelandBusiness Member
    Real Estate Broker · Tampa Bay/St Petersburg, FL · Member since 2015 · 1k+ posts · 2k+ votes
    3y

    Property tax rates will vary considerably from market to market. 

    Also be very cautious about using the current owner's property tax bill from public records. In some areas where owner occupants have a homestead exemption and/or an annual cap on tax increases, there can be a huge spread between what the current owner pays, compared to what a buyer will pay after the property is reassessed at the new sale price. 

    Many county property appraiser's/assessor's offices will have an online calculator where you can plug in a purchase price and get a tax estimate. Here is one example from Florida: https://pcpao.org/taxEst.php

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    0Reply
  • Account Closed
    Investor · Denver, CO · Member since 2022 · 184 posts · 78 votes
    3y

    You should see accurate tax info on the listing page. Zillow, Realtor, Redfin, all have accurate tax information on the listing page. 

    1Reply
  • Jeff Costa
    Member since 2021 · 166 posts · 113 votes
    3y
    Quote from @Account Closed:

    You should see accurate tax info on the listing page. Zillow, Realtor, Redfin, all have accurate tax information on the listing page. 

    Zillow recently (and quietly) removed tax information from listings. They still provide a link to the assessor’s website though.
    0Reply
  • Account Closed
    Investor · Denver, CO · Member since 2022 · 184 posts · 78 votes
    3y

    I don't spend much time on Zillow so that is news to me. Interesting. I'm curious what their reasoning is there. 

    Thanks for letting me know. 

    0Reply
  • Dan Garrigus
    Lender · San Diego · Member since 2022 · 57 posts · 28 votes
    3y
    Quote from @Mary Ainsworth:
    Quote from @Dan Garrigus:
    Quote from @Mary Ainsworth:

    Hey! I'm just learning how to analyze deals and I'm confused about how to estimate property taxes. 

    option 1: someone told me that property taxes are about 1.25% of a property's purchase price

    option 2: the mortgage estimation on the MLS + property tax estimator on the MLS

    Which of these 2 options would be more accurate?

    Thank you!!


     Hi Mary!

    Hope you're having a great Monday! Great question by the way. We use the 1.25% as a good rule of thumb when preapproving our clients as we do not know where our buyer's property will be. 

    With that said, if you're just estimating what a properties taxes will end up being then the 1.25% figure will work just fine. Most cases that rate may be a bit high, making your overall taxes for the year a bit cheaper. Thats a win for you.

    Here is a link that I think can bring you great value. San Diego Taxes

    Hope that helps!







     Thanks Dan! Very good to know I'm using a fairly accurate number at least in these initial analyses :) 


     Mary that link will bring you to a PDF with all the current tax rates in SD. just scroll all the way to the bottom to find the market that you are looking for to get the most accurate figures.

    0Reply
  • Mary Ainsworth
    OP
    Lender · San Diego, CA · Member since 2022 · 235 posts · 94 votes
    3y
    Quote from @Dan Garrigus:
    Quote from @Mary Ainsworth:
    Quote from @Dan Garrigus:
    Quote from @Mary Ainsworth:

    Hey! I'm just learning how to analyze deals and I'm confused about how to estimate property taxes. 

    option 1: someone told me that property taxes are about 1.25% of a property's purchase price

    option 2: the mortgage estimation on the MLS + property tax estimator on the MLS

    Which of these 2 options would be more accurate?

    Thank you!!


     Hi Mary!

    Hope you're having a great Monday! Great question by the way. We use the 1.25% as a good rule of thumb when preapproving our clients as we do not know where our buyer's property will be. 

    With that said, if you're just estimating what a properties taxes will end up being then the 1.25% figure will work just fine. Most cases that rate may be a bit high, making your overall taxes for the year a bit cheaper. Thats a win for you.

    Here is a link that I think can bring you great value. San Diego Taxes

    Hope that helps!







     Thanks Dan! Very good to know I'm using a fairly accurate number at least in these initial analyses :) 


     Mary that link will bring you to a PDF with all the current tax rates in SD. just scroll all the way to the bottom to find the market that you are looking for to get the most accurate figures.


     Wow it has so much info, thank you!!

    0Reply
  • Dan Garrigus
    Lender · San Diego · Member since 2022 · 57 posts · 28 votes
    3y
    Quote from @Mary Ainsworth:
    Quote from @Dan Garrigus:
    Quote from @Mary Ainsworth:
    Quote from @Dan Garrigus:
    Quote from @Mary Ainsworth:

    Hey! I'm just learning how to analyze deals and I'm confused about how to estimate property taxes. 

    option 1: someone told me that property taxes are about 1.25% of a property's purchase price

    option 2: the mortgage estimation on the MLS + property tax estimator on the MLS

    Which of these 2 options would be more accurate?

    Thank you!!


     Hi Mary!

    Hope you're having a great Monday! Great question by the way. We use the 1.25% as a good rule of thumb when preapproving our clients as we do not know where our buyer's property will be. 

    With that said, if you're just estimating what a properties taxes will end up being then the 1.25% figure will work just fine. Most cases that rate may be a bit high, making your overall taxes for the year a bit cheaper. Thats a win for you.

    Here is a link that I think can bring you great value. San Diego Taxes

    Hope that helps!







     Thanks Dan! Very good to know I'm using a fairly accurate number at least in these initial analyses :) 


     Mary that link will bring you to a PDF with all the current tax rates in SD. just scroll all the way to the bottom to find the market that you are looking for to get the most accurate figures.


     Wow it has so much info, thank you!!


     You're very welcome!

    0Reply
  • Carlos Ptriawan
    Member since 2019 · 7k+ posts · 4k+ votes
    3y

    You need to find out a non-owner-occupied property in the same zip code, then find out the most accurate tax information from there.

    0Reply
  • Eliott Elias
    Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
    3y

    This is found on your county CAD 

    0Reply
  • Chris McFarlandPro Member
    Real Estate Investor · Berkley, MI · Member since 2014 · 6 posts · 2 votes
    3y
    Quote from @Mary Ainsworth:
    Quote from @Chris McFarland:

    Hello Mary,

    I recommend contacting the City Assessor and asking them what the new taxes will be at a specific purchase price.  They can calculate the exact taxes for you.  I find this especially helpful when a property has not been bold in a very long time.


     Thanks Chris! I will look into calling them. So as long as the properties I'm looking at are in the same city, the property taxes only change depending on the property's purchase price? 


    0Reply
  • Chris McFarlandPro Member
    Real Estate Investor · Berkley, MI · Member since 2014 · 6 posts · 2 votes
    3y

    Hello Mary, you must let the assessor know that this will be an investment property.  In Michigan you can only homestead one property which minimizes the increase.  On non-owner occupied investment properties, you are unable to homestead the property and so you can expect the taxes to increase by almost double of a homesteaded property.

    0Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    3y

    Why don't you start with researching & understanding how property taxes are calculated in the city you are looking to invest in?

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  • Mark Frattini
    Real Estate Agent · San Diego, CA · Member since 2014 · 338 posts · 176 votes
    3y

    @Mary Ainsworth

    Use 1.1%-1.25% of the purchase price and that should give you a pretty good idea what your annual property tax expense will be. Also, don't forget to add in the Mello-Roos if there are any. 

    0Reply
  • Eliott Elias
    Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
    3y

    You can find your property taxes in your county website 

    0Reply
  • Eliott Elias
    Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
    3y

    You can find property taxes in your county website 

    0Reply
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