Property Taxes

So for those of you that are renters and are considering the purchase of your first home, property taxes are one of those added expenses that go into the same category as insurance and paying for the plumber (also known as the things the "landlord" has to worry about).

For the sake of making things easy let's say the home you purchase is worth $500k, in the state of California your yearly property taxes are usually a little more than 1% of the value of your house. Therefore, you'll be paying about $6k a year in property taxes. Now, you can either pay this twice a year or you can pay this in monthly installments.

In Pasadena a handful of homes, especially those in Bungalow Heaven, fall under the Mills Act. The Mills Act can save a homeowner up to 40-60% on their property taxes and at $6k a year the savings from the Mills Act can really add up. I'm trying to convince S to up our budget cap by $30-$40k if we purchase a home that qualifies for the Mills Act because we would end up saving in the long run :) Not sure if he's falling for it but at least I'm doing my homework!

I recently found this home that just hit the market a few days ago that's under the Mills Act. It's a pretty amazing property.