How Important Are Real Estate Taxes In Buying A Home?

How Important Are Real Estate Taxes In Buying A Home?

 

Lenders use PITI (principal, interest, taxes and insurance) along with other debt to determine how much someone qualifies to buy. It is easy enough to calculate the principal and interest payment on any one of the online tools available. My web page www.dagriffinfinancial.com  has such a tool. This is important information but only part of the total the lender uses to qualify a home buyer.

One facet of the payment, the real estate property taxes, can matter to some folks as to the home they buy. I know of some who insist they only want to buy in a more rural area because taxes are lower there,  county only taxes vs city and county in other areas. Higher taxes can affect the buying power of someone who is borderline in what he/she can afford. So this is one important reason to consider the real estate taxes. 

Assuming the real estate taxes are not a deterrent due to limiting purchasing power then consider what you get for the higher taxes. Higher taxes tend to be in cities that provide more services be it a paid fire department or higher ranking schools for instance. A higher tax area may have a greater impact on how fast equity builds due to the services or schools for instance. 

The bottom line is that when buying a home take a look at the taxes and make sure you are aware of what you'll be paying but don't make a decision solely on the basis of tax rate. In the grand scheme maybe a few extra dollars a year on taxes may put you in a home you prefer.

 

 

 

 

 

 

Comment balloon 0 commentsDora Griffin • January 18 2019 09:42PM
How Important Are Real Estate Taxes In Buying A Home?
share
How Important Are Real Estate Taxes In Buying A Home? Lenders use PITI (principal, interest, taxes and insurance) along with other debt to determine how much someone qualifies to buy. It is easy enough to calculate the principal and interest… more
I'm Self Employed, Can I Buy A Home?
share
I'm Self Employed, Can I Buy A Home? I had a call today from a self employed home buyer with questions about buying a home. He had called his banking partner and was told he needed two years of self employed income to qualify for a home loan and… more
WHEN CLOSING COSTS ARE LESS THAN SELLER AGREED TO PAY
share
WHEN CLOSING COSTS ARE LESS THAN SELLER AGREED TO PAY Before shopping for a home most home buyers will take into account their funds for down payment, closing costs and other out of pocket expenses. Depending upon the loan program these figures… more
Are Rising Rates Driving Home Buyers Away?
share
ARE RISING RATES DRIVING HOME BUYERS AWAY? In Northern Kentucky 2018 was a tough year to be a home buyer. Defined as a seller's market like most of the U S, if one were looking to buy you needed to be paying attention all the time. For home buyers… more
WINTER, A GREAT TIME TO SELL A HOME IN NORTHERN KY
share
WINTER, A GREAT TIME TO SELL A HOME IN NORTHERN KY. It seems winter came early to Northern Kentucky this year. We've had a couple of ice events already and accumulating snow in November is unusual for us. An ice storm in November brought down a… more
SHOP SMALL BUSINESS SATURDAY NOVEMBER 24, 2018
share
SHOP SMALL BUSINESS SATURDAY NOVEMBER 24, 2018 SMALL BUSINESS SATURDAY IS THIS WEEKEND! This is the weekend to think about what you are buying and determine if you can buy it locally. Support local retailers vs the big box stores. Your money… more
VA LOANS OFFER AWESOME BENEFITS
share
VA LOANS OFFER AWESOME BENEFITS VA loans offer awesome benefits to military home buyers or for refinance. Some of the benefits are: ZERO DOWN PAYMENT AVAILABLE (One can put down funds if desired) NO MONTHLY PRIVATE MORTGAGE INSURANCE GREAT… more
JUST VOTE NOVEMBER 6, 2018
share
JUST VOTE NOVEMBER 6, 2018 No matter who you vote for, no matter your party affiliation VOTE on NOVEMBER 6, 2018!!!! We in this country do not fully realize how precious our right to have our say about our government and ultimately our lives… more
What is going on with interest rates?
share
What is going on with interest rates? What is going on with interest rates? It's a volatile time in the long term interest rate market and here's my take on it as well as the prime rate. The prime rate and long term interest rate are two different… more
Save Up to $525 On Conventional Purchase Loans
share
Save Up to $525 On Conventional Purchase Loans For Kentucky Conventional Purchase Loans And A Limited Time Only save up to $525 on the appraisal fee. Closing costs are not a pleasant part of the home buying process. Many costs cannot be… more