Property taxes might be a non-issue for the 36% of people who rent their homes, but for other homeowners and reverse mortgage borrowers they are critical expenses standing between them and possible foreclosure.
The average American household spends $2,089 on property taxes for their homes each year, according to a new analysis from WalletHub, which ranked the states with the highest and lowest property taxes in 2015.
April 7th, 2015 | by Jason Oliva Reverse Mortgage Daily
Relying on U.S. Census Bureau data in its analysis—and a calculation that includes dividing the median real estate tax payment by the median home price of $173,200—WalletHub finds the states with the lowest yearly average property taxes were Hawaii ($482), Alabama ($752), Louisiana ($832), Delaware ($917) and South Carolina ($984).
On the flip side, the top-five states with the highest property taxes included New Jersey ($3,971), Illinois ($3,939), New Hampshire ($3,649), Wisconsin ($3,398) and Texas ($3,327).
With roughly $15 billion worth of homes foreclosed upon each year as a result of property tax delinquencies, according to the National Tax Lien A
ssociation, experts agree that real estate taxes are a critical to consider when buying a home, and maybe even more so for elderly buyers or homeowners.
Even after a homeowner has paid off his or her home, property taxes can still be a large financial burden, especially for senior citizens, said Bree J. Lang, assistant professor of economics at Xavier University’s Williams College of Business.
“Whether or not the elderly or other groups of people should be exempt from property taxes generally rely on ‘moral’ arguments of fairness,” Lang said to WalletHub.
Because property taxes have the potential to generate forced sales of property by people who are unable to pay, it is important to ensure that property taxes do not disproportionately burden less wealthy property owners—seniors included, said Diane Lourdes Dick, assistant professor of law at Seattle University School of Law.
“In addition, systems of property taxation should offer generous exemptions for persons (such as senior citizens) who may have limited cash flow to pay ongoing tax bills,” she said to WalletHub. “These are social policy choices, through which societies attempt to balance revenue-raising and wealth redistribution goals with the needs of individuals who may be struggling to keep their homes.”
View the WalletHub analysis.
Written by Jason Oliva
Original article: Reverse Mortgage Daily http://reversemortgagedaily.com/2015/04/07/these-states-have-the-highest-property-taxes-in-2015/