Feeds:
Posts
Comments

Archive for the ‘property taxes’ Category

Oakland County Home Prices on the Rise BUT Housing Is Cheaper

When most Oakland County MI home buyers purchase a house they are buying under a certain house payment amount. Many factors go into that amount including home price, property taxes, mortgage interest rate. Your mortgage pre-approval is really an approval for a certain monthly payment- principle, interest, taxes and insurance or PITI. The purchase price in your pre-approval letter should be qualified with a cap on the interest rate and property taxes.

Example: Borrower is approved for a mortgage amount of $400,000 wih an interest rate not to exceed 3.7% and property taxes not to exceed $5,000.

This means you cannot mortgage $400,000 if the property taxes are $7500 or the interest rate goes up to 4.5%. Conversly, you can mortgage over $400,000 if the property taxes are $2000 and/or the interest rate is 3.2%. The goal is to keep the house payment under a certain $$ amount.

Though home prices in Oakland County have been on the rise, property taxes have been on the decline, and mortgage interest rates are still low.

Another example: I had an Oakland County home listing in 2007 for $400,000. At that time the property taxes were $6203/year and the average interest rate in 2007 was 6.34%. The average intersest rate in 2012 was a mere 3.66% with the months of November and December boasting interest rates of 3.35%. Property taxes for that house were only $4429 or $148 less per month than in 2007. You would need to pay $600,000 today for that same Oakland County house to have the same payment as the buyer in 2007. Another way to look at it is the seller would have had to come down to $295,000 for the buyer to have the same payment as he would if he bought for $400,000 today.

Or $295K sale price in 2007 = $400K sale price in today

Or $600K sale price today = $400K sale price in 2007

2013 will be a good year to purchase your Oakland County Michigan home. Prices are on the rise, but still quite low, and take advantage of the low property taxes and super low mortgage interest rates.

Jackie Hawley, Realtor
ReMax Encore, Clarkston

My direct line at the office is 1-800-401-1444.

My cell number is 248-736-6407.

And my email address is Jackie@JackieHawley.com

Search the MLS

Homes for Sale in Oakland County MI
Homes for Sale in Clarkston MI
Homes for Sale in Lake Orion MI
Homes for Sale in Oxford MI
Homes for Sale in Waterford MI
Homes for Sale in Lapeer MI

www.ClarkstonMichiganRealEstate.com
www.OaklandCountyMichiganLakes.com
www.LakeOrionLakeFrontRealEstate.com

www.MiRelocation.com

Preparing Your Home for Sale
Why List With Me

Marketing Your Home

Choosing a Buyer’s Agent

Read Full Post »

Oakland County Michigan Home Buyer- How to Calculate Your New Property Taxes

Right now in Oakland and Lapeer County Michigan many houses are assessed higher than their true market value. Many home buyers are under the false assumption that they will only be stuck with that tax for the first year. That the new assessment will be half the sale price. This is not correct!

When I show you houses, one of the sheets attached to the listing is the public record report for the house that is available through our MLS. This public record sheet (or PRD) will give the taxable value and the state equalized value as well as the annual tax amount.

The taxable value is the number used to calculate your taxes. The taxable value times the millage rate equals your annual tax bill.  Upon transfer of deed (sale) the SEV will become the new taxable. In this market there’s a good chance the SEV will be higher than half the sale price.

I showed a house the other evening that is listed for $278K. The SEV and the taxable are both $163,610. Multiply that by 2 and you will be taxed like your house is worth $327,220. That is going to make a difference on your monthly payment.

This isn’t to say your assessment won’t drop next year– state law states that the assessed value is to be one half of the assessor’s estimate of market value of your property, and that the taxable value has to be less than or equal to the assessed value. And once ownership is transferred, and a new taxable in place, that taxable value is capped at 5% or the rate of inflation- whichever is less.

Many townships are dropping assessments across the board. The house in the above example was assessed at $198,670 in 2006 and has dropped each year since. You may also fight your assessment through your township and appeal to the state if you are not satisfied with the results.

For the purpose of determining what your costs will be when purchasing a home, you should figure the worse case scenario and figure your new payments based on a tax amount that uses the SEV plus 5%. When your taxes end up lower- treat yourself! Or put it against the principle of your house.

Search the MLS

More Information About Buying In Oakland County MI

Financing

Buying a Short Sale or Foreclosure

The Home Inspection

Jackie Hawley
ReMax Encore
Cell: (248)736-6407

Jackie@JackieHawley.com  

www.MiRelocation.com 

Read Full Post »

What Exactly Are Lakefront Taxes?

I’m in the middle of a home search for a buyer transferring to Oakland County Michigan. I came across a listing that states you can get lakefront home without the lakefront taxes. In reality it’s an off the water house with a separate parcel on the water with a dock, but that’s not the issue. The issue is- What the hell are lakefront taxes??!!

Taxes in Michigan are based on the taxable value. The taxable value is based on what the state equalized value (SEV) was at the time of purchase. The SEV is supposed to equal half of market value. There is NOT EXTRA TAX FOR BEING ON A LAKE!! Your assessment may be higher than if you live in the same house off the water. MAY be higher. The same house on 20 acres may be valued higher than if it were on the lake and taxed accordingly.

At times I have buyer clients comment about paying lake taxes. I understand when someone who doesn’t earn a living selling real estate has misconceptions about how homes are taxed. However, it is inexcusable when fellow “professionals” don’t know what they’re talking about and even go so far as to publish their ignorance for all to read.

Jump ahead a day. After writing what’s above I have spoken to a few Realtors who I respect ,and a couple of them thought there was a higher tax on the water. So I called Independence Township to verify. Got laughed at and told there is no special tax for living on a lake- just an assessment to reflect the value of living on the water.

For more about calculating your new property taxes when you purchase your home

How the current taxes can affect your buying power

Search the MLS

Jackie Hawley, Realtor
ReMax Encore, Clarkston

Cell: (248)736-6407

Jackie@JackieHawley.com

www.MiRelocation.com

Read Full Post »

How Much Does The Interest Rate Really Affect Your Buying Power?

I am going through old listings that couldn’t sell at the owner’s desired price and through files of home owners who didn’t try to sell after getting a market analysis (CMA) for their home because of the value at that time. The good news for those homeowners is that prices are coming up in the Clarkston area and have been for the past couple years. But for buyers- if you look at your payment instead of price- prices are still very low.

As an example I just pulled up a listing I had in 2007 that was asking $400,000. At that time the interest rate for mortgages was at an average of 6.34%. When I checked the Freddie Mac web site I found the average interest rate last month was 3.92%.

What does this mean from the buyer perspective? If you would have bought that particular house for $305,000 in 2007 your payment (principle and interest) would be the same as if you were to pay $400,000 today. That’s a hundred thousand dollars worth of buying power just in the difference in the interest rate.

But it gets better!!! The property taxes on that house have dropped from just over $6k/year to just over $4600/year. That’s $116/month savings in your house payment.

Interest rates are not going to stay this low forever. Home prices are on the rise– not skyrocketing, but steadily rising. If you have been holding off buying waiting for the market to hit bottom I think we may be there- especially when you factor in the mortgage interest rate and property taxes. AND the cherry on top is the fact that your property taxes will be capped to 5% or the rate of inflation as long as the house is your primary residence. So for the example above it will take quite a while before property taxes are back at 2007 amounts.

Clarkston Lakefront Homes For Sale

Waterford Lakefront Homes For Sale

Lake Orion Lakefront Homes For Sale

For Buyers

For Sellers

Search The MLS

Buing a Foreclosure or Short Sale

Jackie Hawley
ReMax Encore, Clarkston
Jackie@JackieHawley.com

Cell: (248) 736-6407

www.MiRelocation.com

Read Full Post »

Clarkston Michigan Home Buyer- How to Calculate Your New Property Taxes

Right now in Clarkston Michigan many houses are assessed higher than their true market value. Many home buyers are under the false assumption that they will only be stuck with that tax for the first year. That the new assessment will be half the sale price. This is not correct!

When I show you houses, one of the sheets attached to the listing is the public record report for the house that is available through our MLS. This public record sheet (or PRD) will give the taxable value and the state equalized value as well as the annual tax amount.

The taxable value is the number used to calculate your taxes. The taxable value times the millage rate equals your annual tax bill.  Upon transfer of deed (sale) the SEV will become the new taxable. In this market there’s a good chance the SEV will be higher than half the sale price.

I showed a house the other evening that is listed for $278K. The SEV and the taxable are both $163,610. Multiply that by 2 and you will be taxed like your house is worth $327,220. That is going to make a difference on your monthly payment.

This isn’t to say your assessment won’t drop next yearstate law states that the assessed value is to be one half of the assessor’s estimate of market value of your property and that the taxable value has to be less than or equal to the assessed value. And once ownership is transferred and a new taxable in place, that taxable value is capped at 5% or the rate of inflation- whichever is less.

Many townships are dropping assessments across the board. The house in the above example was assessed at $198,670 in 2006 and has dropped each year since. You may also fight your assessment through your township and appeal to the state if you are not satisfied with the results.

For the purpose of determining what your costs will be when purchasing a home, you should figure the worse case scenario and figure your new payments based on a tax amount that uses the SEV plus 5%. When your taxes end up lower- treat yourself! Or put it against the principle of your house.

Search the MLS

Homes for Sale in Clarkston MI

Lakefront Homes for Sale in Clarkston MI

For Buyers- Choosing an Agent

For Buyers- Financing

For Buyers- Negotiating the Purchase

Jackie Hawley

Keller Williams Realty
cell: 248-736-6407
email:
Jackie@JackieHawley.com

web: www.MiRelocation.com

Search The MLS

Read Full Post »

Michigan Tax Legislation Now in the House of Representatives- Good News for Home Buyers

A brief explanation of how Michigan property taxes work. We have what is called the homestead exemption for a person’s primary residence in The Great Lakes State, which basically means if the house is your primary residence you get a break on the millage rate- up to 18 mills. On a house valued at $200K- or a taxable value of $100K- 18 mills equals $1800. Not chump change.

The way the law currently works is if you buy a house that isn’t a primary residence, such as a bank owned home, you must close and file your homestead exemption with the township prior to May 1. If you file after May 1, you will pay the higher rate for the remainder of the year. So if you close on your house in June, you will have both the summer and winter tax bill at the higher rate.

Today I received an E-News Special Alert in my in box from the Michigan Association of Realtors letting me (and everybody else in their e-blast) know that Senate Bill 77 passed the Michigan Senate today with a vote of 36-0 and now moves to the House of Representatives. The email states that “This legislation would provide for an additional principal residence filing date of October 1st.” It goes on to state an amendment was added to move that date to November 1 for 2010 only. It wasn’t specific as to whether you have to file ON Oct. 1 or BY Oct. 1. As I find out more details, I will update you.

In the meantime you may want to contact your state rep to let them know how you want them to vote. I have also found when I need more details on a piece of legislation, my rep has had no problems in the past emailing me the complete text of a bill. Remember- our representatives work FOR us.

Read Full Post »

It was the best of times (when your house was assessed). It was the worst of times (now)… it was the epoch of belief, it was the epoch of incredulity… it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us…

Two houses in Oakland County Michigan– both priced the same. Both in the same township with the same greedy bloodsucking tax revenuerstax base. The difference- The tax amount. To the tune of a tad over $2800/year or $235/month. This is not chump change and it is very important.

When you get pre-approved for a $300,000 sale price, the loan officer had to use some number for taxes. In reality, when you get pre-approved for a mortgage, you’re really getting pre-approved for a maximum house payment amount.

In the example above, the difference in taxes is because of the assessments and the fact that one of the houses is in the village and has a village tax. Both are on the same lake. So- how does the that $2800 additional annual tax affect your buying power?

To make the math easy, I’m going to assume an interest rate of 4 3/8%. At a 4 3/8 per cent interest rate $5=$1000 of sale price. Or annual tax. A difference of $235 in house payment equals about $47,000 in purchase price. OR– house A with higher taxes would need to sell for $47,000 less than house B in order to have the same monthly house payment. Or- you can pay $300,000 for house B and have the same house payment as you would if you paid $253,000 for house A.

When I show you houses, attached to the MLS sheet is the public record that gives recent tax information and an assessment history. This will also help you determine what your new taxes will be. So when we’re looking at things like size, location, price, we also need to pay attention to the property taxes.

Read Full Post »

Older Posts »