Lower home prices are bad news for sellers -- but other homeowners may benefit from lower prices.
Your town or county government sets the property-tax rate based on the municipal budget. Officials divide the budget's needs by the total taxable property in the jurisdiction to generate the tax rate, or
The tax rate is often expressed as a dollar amount for every $1,000 of property value. For example, if the tax rate in your town is $16 per $1,000 of valuation and your home is valued at $300,000, your annual property tax bill will be $4,800.
How much property tax you pay therefore is a function of the value of your home. So -- in theory, at least -- a 10% reduction in your home's value could lead to a 10% reduction in your property taxes.If prices throughout your town drop equally, your share of the overall tax burden won't change even as your home's value goes down. But if prices in your neighborhood drop faster than those in other neighborhoods, you may find yourself paying more than your fair share of the tax burden.
Getting a reassessment
Your local government assesses properties on a set schedule, typically every several years or when the difference between assessed and market values reaches a certain level. (The rules vary from town to town.) But you can ask for a reassessment any time you feel the assessed value of your home is higher than its market value. To do so, check with your town or county assessor to find out when your property was last assessed and what your home's assessed value is. In many municipalities you can get this information online; check your town or county's Web site to be sure. Otherwise, visit the assessor's office and ask for your property record card. Look for -- and ask the assessor to correct -- any errors regarding your home's age, square footage, number of bedrooms and bathrooms, and any other defining characteristics. Next, determine the sale prices of five to 10 homes in your neighborhood that are comparable to your house. You can do this by hiring a real estate broker to do a sales comparison, or an appraiser who can independently assess your home. Make sure the