While everyone knows that property taxes eat a huge hole in your annual budget, few people around the country realize just how much New Jersey homeowners actually pay each and every year. Ranked as the state with the highest rate of property tax, New Jersey now stands at a rate of 2.38% which is higher than any other state.
Illinois comes in at a close second at 2.32% with New Hampshire coming in third at 2.15%. It may not seem like a lot, but there is more to the story than meets the eye. If you are a homeowner in New Jersey, here are a few tips to help you reduce the amount you pay at the end of 2017.
First, Take Care of This Year’s Taxes!
Before even stopping to think about how to reduce the amount of taxes you pay and how to get them reduced, it is necessary to pay your taxes for 2016 and that may not be an easy endeavor. Consider the fact that the average home in New Jersey is valued at over $665,000 and that 2.8% equates to a hefty figure at that! At 2.38% your property taxes could equal over $15,000, barring any exemptions which might be available to you. In many parts of the country you could own a home with the amount New Jersey residents pay for property taxes in a few years’ time.
So, before seeking ways to reduce next year’s taxes, let’s look at paying this year’s bill. Check out the current mortgage refinance rates NJ has to offer and you might be able to pay your taxes while putting some money in the bank to grow interest to pay next year’s assessment. If you can earn higher interest than you are paying for the loan, you are that much ahead for December’s taxes. And, if you are looking for property tax relief, you can check out the New Jersey Department of the Treasury to see if you meet any of the qualifications.
Everything Verges on the Tax Assessor
The first thing to understand when you are trying to keep your property taxes to a minimum is the fact that your taxes are rated on the valuation of your property. Therefore, it’s all up to your county assessor who places a value on your property based on a number of criteria. As a general rule of thumb, if you want your taxes to be lower, it is in your best interest to keep your property value down. So how do you do that? This is where a few bits of advice and some basic tips can come in handy.
Begin with Curb Appeal
When you want to raise the value of your home, realtors tell you to pay special attention to curb appeal. This can be the main factor in whether or not your home sells. If a potential buyer should drive by and notice the lawn is not cared for and there are all bits of debris and other ‘items’ lying about, chances are they will drive on to the next home on their viewing list. A well-manicured lawn with lovely landscaping will help sell your home and raise the property value accordingly, but that very same lovely lawn can raise your taxes as well. If you are not trying to sell your home and want to keep your property value down, let your lawn go when it’s time for a visit from the assessor.
Steer Clear of Renovations and Additions
While your plumbing fixtures are sorely outdated and have been in your home since the middle part of the last century, now is not the time to renovate your kitchen or bathroom. Keep the original plumbing until after your home has been assessed. While you can’t always count on when the tax department will do an assessment, it’s best to be ready for this year and the next if taxes are a burden on your budget.
Again, here is another rule of thumb to be cognizant of. Adding or renovating (improvement) adds value to your home which is great if you are trying to sell your property. However, if you are trying to keep taxes low, don’t make any improvements unless they are absolutely necessary – and then, only at a bare minimum of what you can get by with.
A Final Word of Advice
After you’ve checked all the things which can add value to your home to make sure they aren’t in play, you have the option to dispute your taxes in many cases. If you order a private appraisal of your home from a licensed property appraiser and it is much less than the county valued your home, call the tax assessor to schedule a visit to reassess your home’s value. If you can show that you have just cause for requesting a county appraisal, your chances are good of getting that visit from the assessor’s office. In the meantime, a refinancing loan may help you pay this year’s tax bill, but these tips should help you get it lowered for next year. Good luck New Jersey! Your taxes are already high so let’s work to bring them down.