Definition
This is the projected annual property tax based on the home's assessed value and the local tax rate. It's part of your monthly payment (PITI) if your lender collects it through escrow.
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Calculated: assessed value x mill rate. Varies significantly by location. Part of PITI payment. Projected at closing for escrow account. Actual taxes may vary from estimate. Assessment changes affect taxes. Growing taxes common over time. Tax bills paid through escrow or directly. Buyer should verify estimates. Property tax impact on affordability. Professional estimates guide budgeting. Municipal variations significant. State differences major factor.
Pro Tip
Verify estimated property taxes are reasonable by comparing to actual tax bills from similar homes in the area.
Example
Estimated property taxes of $3,600 annually were included in PITI calculation.