I found a cheap little home in Carbondale Il just the other day.
It was a 3 bdrm with a small bungalow behind the main house.
..just 42,000 and the place was well maintained.
Looked up the tax info on the county website and it said 0.00
Turns out it was owned by something called the Southern Illinois Homeless Alliance.
They said it would have to be re-assessed once it was sold by the non-profit group.
The tax rate is 10.25% per year on the assessed value.
The tax could end up being close to 5,000/yr ..on a dinky little home like this!?!?
I said to the Realtor “I thought maybe I could rent the bungalow to pay the taxes...but I’d have to live in the tiny bungalow and rent the house instead!”
I liked the place because it’s on a quiet street and within waking distance of a WalMart Supercenter (I have small dreams..lol)
This is madness! Taxation has turned this nice little home into a money sucking nightmare.
http://www.bobdavenport.com/Listing.aspx?mls=331280
https://www.instantstreetview.com/@37.726004,-89.198314,-136.1h,-5.48p,2z
Property taxes on a house priced at $42k could not possibly be $5k.
Sale price and tax assessment aren’t always the same. Often the tax assessment is lower.
Also, if you live there, the homestead exemption automatically lops off another chunk of the taxable amount. You need to find out what your homestead exemption will be.
For instance, if your state’s homestead exemption is, say, $25k, then
only $17k (or less, depending on assessed value) is subject to property tax.
The fact that the property has a rental unit may increase it by a little bit, but still, the annual total tax should be way less than $1k. I’d guess around $500. Nowhere near $5k.
In fact, the $0 tax shown could be correct, and perhaps it simply wasn’t explained to you correctly. You should go back and clarify. The “homestead exemption” is the key phrase to ask about.
Also, many municipalities increase your homestead exemption when you turn 65, reducing your property taxes even more. You could end up with $0 property tax at retirement.
You should go back to the realtor and get prequalified, and ask for a cost breakdown, ie, what will your monthly note be?
A $42k house will be far less than rent.
More importantly, though, I’d wonder, why is the home’s asking price so cheap? What’s the catch? The current owner you named might be a clue!
I’d check with the local police department for the neighborhood crime stats.
Also the racial demographics.