If you are a first-time home buyer in particular you may not be accustomed to the additional part of your mortgage that is property taxes. Even if you pay off your mortgage in full you will still be subject to property taxes. Property tax is calculated by the local government and is based on the value of your home including any land that you may own. Property taxes are used to help fund water and sewer improvements for the city. Property taxes are also used to help support law enforcement, the education system, road and highway construction, as well as local libraries.
As your local Ventura County Realtor and trusted real estate team we are happy to report that property taxes are a tax deduction. However, this tax deduction does come with a cap of roughly $10,000 per year. In an area such as Ventura County with high home values this deduction will be met very quickly. Luckily, many years back in 1978, California Proposition 13 was passed. Prop 13 allows for property taxes to be based on the purchase price of the home and not the current market value. This is a huge benefit to homeowners to stay in their current home.
Prop 13 also allows homeowners to transfer their property taxes one time as long as the homeowner is over the age of 55. This exception to the rule allows older homeowners to get into a retirement home if they so desire without having the pay current market value in property taxes. If you have any additional questions about property taxes or how to pay them, we would be happy to help. As your local Ventura County Realtor and real estate team we hope to make you feel as comfortable with the entire process of purchasing your new home.