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How to calculate taxes on a new home?

When someone is building a new home, one of the most common questions for a Real Estate Agents is: How much would my taxes be?

The total Real Estate taxes you pay for a home in Pennsylvania is a combination of three (3) taxes: County, School, and Municipal taxes.

Those 3 have millage rates which are updated periodically. Your REALTOR® should have the latest millage rate table & can  calculate your taxes for you.

The majority of the housing inventory out there are existing homes. Homes that are already built, lived-in, and are being sold by the current homeowners. Those homes have a public assessment value easily found online. As a matter of fact, there are plenty of websites that pull that information from public records to show you. If a home is listed for sale with a REALTOR®, our MLS system has that information as well & you can easily see what your Real Estate taxes are for the year. It is often displayed on most websites as part of the standard information provided for every home.

However, when someone decides to build a new home, that’s a whole different story. The home does not exist and the assessment office’s public record only shows what the current taxes are on the vacant lot.

Here comes the tricky part. Every county is different. They have a local Assesment Office. In York County, that office is called the Assessment & Tax Claim Office, located in the York County Administrative Center @ 28 East Market Street, Room 105, York, PA 17401-1585 .

York County assessments are calculated on a 2006 value. That means, regardless of whatever you pay to build your brand new home, your assessment value will likely be less. How much less? Well, it’s not an exact science, but they will attempt to figure out how much your value would have been if your home was built in 2006…. and that figure becomes your assessed value.

A good rule of thumb is to multiply the total cost of your home (lot + construction) by 85%. So, if the total cost of your new home is $300,000, your tax assessment would likely come in at around $255,000.

You can multiply that estimated value by the corresponding millage rates and you should have a good idea of what your taxes will be on your new house.

The math and obtaining the most current millage rates is a complicated & sometimes daunting process for most homebuyers. But fear not, your Century 21 Core Partners Agents are here to help. They are quite familiar with this process & should be able to do this for you in a jiffy, as well as help you with all the other nuances that come with building a new home.

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