How Temecula Property Taxes and Special Assessments Impact You Temecula Home Buying Decision

One of the largest buying factors that Temecula home buyers fail to understand and consider is the impact of special bonds and property taxes. Most builder tracts or newer homes in Temecula, Murrieta, Wildomar and Menifee have expensive bond assessments built into Temecula property taxes.  Rates of 1.75%, 1.99%, and even 2.30% are typical.  This is usually in the form of water bonds, street light bonds, school bonds that builders passed on to the future homeowner. How can this impact the buyer purchaser financially? Let's look deeper:

Imagine you are shopping for a new house in Wildomar or Murrieta for $240,000 with a 20% ($48,000) down and a tax rate of 2%. Your 80% mortgage of $192,000 at a 5.5% annual rate (interest only for calculating purposes) would be $880 on a monthly basis.  The new home's 2% property taxes generate an yearly tax bill of $4800 or $400 per month. Thus the total payment for your new home is 880 + $400 = $1280.

Now let's say you are purchasing a resale residence in Temecula for $270,000 house.  The home is 3 years old, fantastic yard and built in bbq with a 1.23% tax rate.  Your 20% down payment would be $54,000 making your new loan $216,000 at 5.5% a monthly cost of $990. Your taxes would now be $3,321 annually, or approximately $277 each month.  So your total monthly cost is $990 + $277 =$1,267. That is $13 less a month and thirty thousand additional home. 

It might sound small on a monthly amount, but remember you are now able to purchase a house for $30,000 more in price which can dramatically increase your home size, lot size, location, neighborhood, or community!  It can make a big difference between getting a 3 bedroom, 2 bath or a 4 bedroom, 3 bathrooms. In addition to the additional value in the property you also normally get landscaping already set up, perhaps a balcony, firepit, fountain, etc.  Also, you can still negotiate and perhaps furniture or pool equipment working with the seller while saving thousands of dollars you would be spending putting up window coverings, trenching for drains and sprinklers, and putting in new sod and a patio cement.  That is just for the basic backyard!

By taking look around you, the home buyer, can find incredible deals when disecting the impact of Temecula home property taxes and assessment bonds on Temecula, Murrieta, Menifee, and Wildomar Real Estate. This is especially true for new homes in Temecula and surrounding communities which frequently have property taxes at 1.9% or more. Many times you will find traditional resale homes with much lower property taxes in the same community or right next to new builder home tracts.

So, if you are buying for Temecula real estate, please make sure to work with a solid Temecula real estate agent.  And always make sure to consider both taxes and special assessments prior to purchasing your new Temecula home and making sure you get the best deal for you and your family.