Property Taxes on a New Home

We are moving to the area and are confused by the disparity in property taxes on similar homes.  Why do they seem to be all over the board?

When you are buying a new home, you should not pay a lot of attention to the stated property taxes.  Homes were last assessed in 2012 and if the home hasn’t resold since, the home’s taxes are based on the assessor’s opinion of value then.  If the home has sold since 2012, it has likely been reassessed at the time of that sale and may have a comparatively higher assessment.  If the home has had extensive interior renovations that did not require a permit, it is unlikely that the assessor will catch up with the increased value until the home actually resells, so its taxes may seem artificially low compared to similar homes.

However, when you buy your new home, there is a very good chance you will be reassessed and your taxes will change.   Taxes are based on current year assessment and your taxes will increase or decrease as your assessment is modified to reflect your purchase price. If the home you love has high taxes based on an assessment above your purchase price, in January – March you will have the opportunity to appeal that high assessment to try to bring it down.  And if you think you got a great deal because of comparatively low taxes, don’t count on it!  Your assessment will likely go up. So what to do if you can’t rely on the stated taxes, which you cannot?

You need to project the taxes on a given house based on your planned purchase price.  The total tax burden is made up of three pieces – county, borough and school.  Any home in Quaker Valley School District will have the same 2018 county and borough tax millage, for a total projected millage of 23.1309.  Then you have to add in the millage for the specific borough the home is in.  In Sewickley borough that number is 6.25 mils, whereas in Edgeworth that number is 4.15 mils.  Once you calculate the total millage, you apply that to the sales price of the home to get an approximate expected tax.  So on $500,000 assessment in Sewickley borough you would expect total taxes of approximately $14,700.  While you should contact your attorney for strategies to keep your assessment as low as possible, including appealing the assessment if it seems too high in relation to your purchase price, this simple rule of thumb will help you to make comparisons between homes you are contemplating owning.