Rising Property Prices Mean Bad News For NY Taxpayers

Blog February 25, 2021 By Admin

The media has been in love with all of the bullish data on home sales and price increases over the past year. Before you get too excited about that, it is important to know the serious downsides of what that means for you as a property owner.


The Illusion Of Wealth

Over the past year real estate appears to have been booming. The news is enthralled by stories of bidding wars, rocketing sales and soaring house prices.

In some parts of the country where New Yorkers are fleeing to the most they have pushed up prices by 50% to over 1,000% in the past 12 months alone. Property and taxes are so cheap elsewhere that they are often paying 2-4x more than homes are worth without even realizing it.

According to Realtor.com Nassau County has also seen house prices climb by 8.5% over the past year. Some LI homeowners may shrug this off. What’s another 10% hike in property taxes this year?

It may sound good when the internet says your house value went up, but unless you are cashing in immediately, it is going to cost you.

The true net impact in your bank account is going to be negative. More cash is going to flow out of your accounts each month and year because of it.


NY Property Taxes

Property tax bills are the combination of tax assessments (how much the property is valued at) x the tax rate.

So, when your tax assessment rises (triggered by improvements or nearby home sales) your tax bills go up. That hike is further multiplied by tax rate increases.

Don’t forget, Nassau County recently re-assessed all of its properties, much to the dismay of property owners. It caused a 50% or more tax spike for many in the county.

Now, rumors of further increasing prices are going to add to that. According to Newsday as many as 65% more homes have been selling on Long Island over the last year. That’s a huge difference, on top of an already bull market run.

So, property taxes going up, when your property value goes up is a relatively easy concept to understand. Yet, when the powers that be want to bring in more money for their pet spending projects and to fund personal pay raises, they always find a way to manipulate the numbers. Real Estate Weekly reports that even though NYC property values have actually declined steeply (by 20% or more in some cases) by their estimates, tax hikes mean building owners across the five boroughs are actually being billed even more this year. It seems there will always be an excuse to justify another tax hike.


Stop Overpaying, It’s Your Right

These hikes come in the face of the fact that 40% or more have been struggling paying their property tax bills during the pandemic. The Real Deal reports in NYC alone owners are delinquent on more than $1.3B in property taxes already. That’s while around 48% of all local residents have been knowingly overcharged on their property tax bills.

You have a few days left to pay or challenge your property tax bill. DO IT. It is one of the few rights you may have left. Don’t be a willing victim to this ongoing financial scam.