Property taxes. How many people think about the tax rate BEFORE they purchase a home. Just think about it; you are strapping yourself down to a 30 year committment, laying down thousands of dollars on a down payment, negotiating with the finance company for the best interest rate and working to lower your payment to a manageable amount, and you didn't give a thought to property taxes.
Property taxes are a burden you will deal with for the entire time you own your home. Every year that bill comes, and the next thing you know, thousands of dollars are due. Or you can pay monthly into an impound account, giving someone else your money to hold on for you (and they are earning interest on your money the entire time), just so you can have that money saved to pay the taxes when due. But you are still paying the same amount, it just seems like less because you didn't have to cough it up all at once.
When my wife and I looked for our home, this being our third home together, we knew what it meant to pay property taxes and how that affected our bottom line every year. We decided to only consider homes in areas with lower tax rates. We were surprised to find new homes with rock bottom tax rates in a community beside new homes with sky high tax rates. We instructed our Realtor to only show us homes in communities with tax rates .5% or less. I didn't want to see a home, fall in love with it, and have to pass because the of the tax rate. By limiting our choices, we quickly found our dream home, and have never looked back.
Recently at a party, my friend was complaining about property taxes. I knew that her tax rate was 1.9%, because we had passed on seeing homes in her community when we were home shopping, only due to the tax rate. A beautiful community with many wonderful amenities, all of which the residents pay for with their HOA fees, and only 1 mile from my community, but the tax rate alone scared us off. She was shocked when her first tax bill arrived, because not only was there the 1.9% rate to contend with, but our little town had recently become a city, and now the assessments were starting to climb. Her bill was 3 times what ours was. 3 times!
When you are in the market for a home, talk to your Realtor, and ask about tax rates. Your Realtor is well aware of the tax rate of every home they show you, and can limit your choices, based on your preferences. Ask questions, set a limit, and save the money.