Taxes might seem like they’re made just to confuse you, and you probably aren’t too far off from the truth in thinking that. How often do you really understand exactly what you’re getting charged for and why? There seem to be special rules on everything, and those rules only seem to drive the prices up. If you want to know if San Diego is a good city to buy your next home based on property tax, Movoto is here to give you the basics.
What Are the Costs?
Everything is subjective based on the demand, which can work for you or against you. In San Diego, the weather, beach and sunshine make it a highly prized placed to live with a median home value of about $500,000 (heavily dependent on your zip code.) Your property tax will be based on 1 percent of the assessed value of the home itself, based on the condition of the property, the surrounding area and the current market. There is a limit on how much your home value can be raised, but if you feel your house is being significantly overvalued (say it’s being raised 2 percent in value when you feel it should only be raised 1 percent in value), you can always raise your concerns with the city between July 2 and December 1 every year. Proposition 13 stipulates that the 1 percent property tax is based on the purchase price and will never be raised and your home price can never be assessed at more than 2 percent more from year to year. So say the value of your home increases a half percent every year for five years. By that fifth year, something happens in San Diego where there’s a figurative gold rush. You know you could sell your property for twice what you bought it, however the assessor can only raise the price of your home 2 percent when it comes to charging your property tax. There is one exception though in that if you do major construction (say adding 2 more full bathrooms) then they can raise your property by more than 2 percent.Â
In this area though, the cap on assessment rate at 2 percent is an incredibly nice perk to have. Your home price could go up exponentially and you won’t be stuck with the extra bills. You’ll also be taxed an additional percentage, which is generally coming from your neighborhood’s pre-approved funding goals. For example, if the area has decided they need more money for the schools and has already voted to raise taxes. There are also Mello-Roos taxes or other fixed charge assessments, which go straight to local governments for community concerns. Anything from sewage costs to unforeseen crisis funds. These have nothing to do with your home value and they may or may not increase every year. In the case of Mello-Roos, not all areas pay these taxes though as some see more value in them than others, meaning they are neighborhood specific. When you add everything in, the average is generally between 1.02 and 1.19 percent You’ll need to ask the measures that have been approved in your area or you can click here to help calculate a property based on address.
What Does The Rest of Country Look Like?
San Diego’s property taxes are either reasonable or cheap compared to other major cities. In Chicago, you’ll pay over 2 percent in the city and in NYC, you pay based on your tax class and rates have soared there over this past year based on rising home values. Washington DC and Seattle are slightly less than San Diego, but only by fractions of a percent. You’ll pay about 1.17 percent in San Francisco or Minneapolis. Cleveland is about 2 percent, but they typically have lower rates for many of the other major taxes there. If you’re considering living in Los Angeles or Orange County, you’ll pay about the same amount in terms of property taxes as San Diego.
The warning here is that picking a place based on the property tax is difficult because there are so many fees, rates and charges, it’s hard to make the recommendation that you should buy based on property tax. If you want to live in a well known city, you’re going to pay a lot in taxes regardless of how exactly they’re labeled. Your tax bill will have terms on there that date from a very different time, so unless you’ve followed every local proposition and government reform bill, part of you will just have to trust that your money is being put to good use so you can continue living the life you’ve grown accustomed to in your home. This holds true for everywhere across the United States.
What Else Should I Know?
It should be clear that your San Diego property tax won’t break the bank here, despite the high cost of living here in general. When you want your real questions answered, you have to start as locally as possible. The state of your neighborhood streets and businesses will give you a fantastic idea of where your money is going. Knowing who your mayor is and what the local schools are doing with their students is more important than memorizing tax rates. Understanding your taxes is important, however if you find a place that you love in this area that you can also afford, that may have to be your biggest consideration as to whether or not this is the city for you.
2 Point Highlight
In this area, the cap on assessment rate at 2%Â is an incredibly nice perk to have.
San Diego’s property taxes are either reasonable or cheap compared to other major cities.
