Property Tax & Costs

Property taxes are the recurring bill that follows a home long after the purchase is done, and they can rise even when nothing else changes. Understand how your bill is calculated, what drives it up, and the legitimate ways to keep it in check.

Housing

Property Taxes Explained: How They’re Calculated, What Affects Your Bill, and Ways to Reduce Costs

By Emily Parker

Frequently Asked Questions

Your bill is based on the assessed value of your home and the local tax rate.

Learn more: Property Taxes Explained

You can appeal your assessment, claim exemptions, and correct any errors on record.

Learn more: Property Taxes Explained

Taxes, insurance, and upkeep add up well beyond the mortgage payment.

Learn more: 9 Housing Expenses That Increase the True Cost of Homeownership

Surprise repairs and fees can strain a budget that only planned for the mortgage.

Learn more: Hidden Housing Costs and Financial Risks

Key Terms

Property Tax

DEFINITION

A tax on real estate, typically calculated by multiplying the assessed value of your property (land plus structures) by the local tax rate, also called the millage rate. For example, a $350,000 home with a 2% rate produces a $7,000 annual bill. The revenue funds local services like schools and fire departments, and exemptions for seniors, veterans, or primary residences can lower what you owe.

Learn More

Housing Expenses