High property tax are one of the considerations a real estate investor should take seriously. The amount paid on taxes affects the turnover and the costs that go into maintaining a property. Property taxes are a major revenue source for state governments, most of the federal revenue from property taxes goes into medical care, social security, while state revenue on property taxes were put towards local needs like construction, public education and maintenance of existing structures, according to the census bureau, the median annual property tax paid on homes was $2,578 in 2019 or 1.03% of home value, but some house owners can pay more than this. Earlier in 2018, The State and Local Tax (SALT) cap began limiting the amount that could be deducted against federal income taxes. This will result in taxpayers who pay more than SALT amount being faced with more federal tax bills.
Below are a short but unexhaustive list of states with considerable(a.k.a High) property taxes.
Cities with the Highest Property Tax
Due to the work from home policies adopted by several companies because of the COVID 19 pandemic, there’s been sort of recent migration from cities to houses in suburbs with outdoor spaces. This list is to guide investors and prospective house owners against incurring high costs on house ownership.
- Milwaukee, Wisconsin: The growing city of Milwaukee in Wisconsin is oozing of new energy, from revitalized architecture and new festivals celebrating diversity, Milwaukee seems like the ideal property investment spot. Milwaukee has an effective tax rate of 2.17% and a median of $3,122 in property taxes paid. The median home value is around $133,600 while the median income of a home-owner in Milwaukee is $66,465.
- El Paso, Texas: Texas has been in the news of recent, from Tech companies moving their HQs to Houston and the world’s richest man(as at the time of writing this) relocating there. El Paso has a property tax rate of 2.13%, median property taxes of about $3,100, and nearly similar home value to Milwaukee with a valuation of over $133,600 and a median home-owner income of over $60,000.
- Omaha, Nebraska: Apart from its authentic Midwestern culture, here are a few quick facts about Omaha and property taxes, Four fortune 500 companies are headquartered in Omaha including Warren Buffet’s Berkshire Hathaway. Omaha has an effective property tax rate of 1.71%, over $3200 in median property taxes. The city has a median value of over $175,000 and a median household income of over $82,000.
- Columbus, Ohio: Money Magazine named Columbus as one of the top six best cities to live in. A robust public transport system, low crime rate, housing, and quality schools are some of the perks that come with the town. The city has an effective property tax rate of 1.62%, median property taxes paid of $ 2,776 and a median property value of 173,000.
- Austin, Texas : Austin has been touted to succeed san Francisco bay as the next destination for tech, Oracle moved their headquarters to Austin, and Electric Car Billionaire, Elon musk is building a new mega factory in Austin touted to be the new headquarters of Tesla upon completion. Austin has an effective housing rate of 1.53%, over $6,60 in median property taxes paid. Austin has a whooping median value of about $380,000 for homes.
In buying a house in any of these cities, Huge consideration has to placed on property taxes, should you need help finding properties in cities with low property taxes, Needtoskip has enough resources and services to support you towards that goal.