From the NYT:
RESIDENTIAL property taxes: Could there be a more potent issue for real estate right now in New Jersey?
Polls indicated that voter concern over high taxes — New Jerseyans pay the highest average of any state — was the defining issue last month in the gubernatorial election that swept Gov. Jon S. Corzine out of office after one term.
Brokers and sales agents report that tax rates are often the first thing on anyone’s lips when a home sale is discussed today.
“We’re now at a point, even in the high-end towns, where people are extremely aware of what they pay in taxes,” said Roberta Baldwin, an agent with Re/Max Village Square in Montclair. “And buyers are very aware of what they might be signing up for.
“You will have some setting limits at the outset on what they are willing to pay in taxes,” she added. “They’ll say, ‘I want the perfect house, but I don’t want taxes over $16,000.’ Or $20,000, or whatever.”
So what do typical homeowners do when their property taxes reach that point? Relocate?
The answer seems to be that despite vociferous disgruntlement over taxes and a record number of tax appeals this year — and despite recent numbers indicating more people moving out of New Jersey than moving in — buyers remain willing to pay high taxes if they have children in well-regarded schools that the taxes underwrite.
From 2000 to 2008, a period during which average property taxes rose by 50 percent, to top out slightly over $7,000, a total of 439,000 people left the state, according to James W. Hughes, the dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University. Over that same period, he said, 385,000 moved in, many of them immigrants.
Looking within the state — with its extreme tax rate disparities from county to county, town to town, and sometimes even house to house — it is also difficult to discern how, or if, taxes actually affect sales, or the desirability of a particular place.
Ms. Baldwin said she long ago confronted the issue of the high property taxes that she has paid as a resident of Montclair for more than 25 years.
“We thought we had reached a breaking point when we were going to have the kitchen redone in our home, and looked at the assessments, and found our house worth less than we had paid for it while our taxes had gone way up,” she said.
She said she and her husband cruised around “lake country,” looking at houses in Passaic County — and fantasizing.
Then, reality sank in: “We don’t want to move out to the country. We need to live in this wonderful town, with all these smart and artsy people we know and like, and wonderful culture, and so close to Manhattan. And we are willing to pay for it.”