From the Philly Inquirer:
Ted Marvel pays $4,900 in annual property taxes on his 1,000-square-foot home in the heart of Collingswood.
In fact, his monthly tax bill – $407 – is starting to rival what he pays in principal and interest on his mortgage. Said Marvel: “They’re going to meet soon.”
In the new millennium, New Jersey’s property taxes, the highest in the nation, are exploring new heights.
“It’s astronomical,” said Marvel. “It’s crazy.” That, too, his Garden State neighbors affirm.
Even as incomes have dropped (4.4 percent), and overall taxable value has fallen in a third of the towns, an Inquirer analysis showed that from 2000 to 2011, average tax bills in Burlington, Camden, and Gloucester Counties rose 44 percent. And that’s adjusted for inflation. The average bill jumped from $3,964, to $5,691.
“They’re astounding,” said Janice Potts, former resident of a place she still loves, Haddonfield, which had South Jersey’s highest annual average tax bill, $12,282 in 2011. She sliced her bill by more than $10,000 by buying a home of similar value in a place not commonly viewed as a tax refuge: Philadelphia.
“They’re terrible,” agreed Edward Borden, a Haddonfield commissioner who pays almost $16,000 in annual taxes on a $595,000 home on Overhill Road. That’s a steep price, even for a tony community with an elite public school system.
On average, New Jersey property taxes consumed 7.8 percent of median income in the 2008-10 period, according to the Tax Foundation. That was double the Pennsylvania figure.
Why are Jersey’s real estate levies in the stratosphere?
The answer is complicated, but one reason is that much of the cost of school, town, and county governments in New Jersey is bundled into the real estate levy.
And just about everything in Jersey, it seems, is more expensive.
About half of all New Jersey’s state and local tax revenue is generated by the property tax, compared with less than 30 percent in Pennsylvania, which has a more varied tax menu.
Property owners complain that the high taxes are hurting their real estate values. They may have a point: In the most recent Inquirer survey, home prices fell 29 percent in South Jersey from 2007 to 2011, compared with a 18 percent decline in the Pennsylvania suburbs.
Another reason for the staggering property taxes in the Garden State: New Jersey is a high cost-of-living state. That translates to higher salaries for public employees. The average pay for 575,000 state and local government employees is the second-highest in the nation, about $65,000 a year – 25 percent higher than Pennsylvania’s – according to census data. That’s similar to the differences in median incomes between the two states.
Public education is more expensive in New Jersey. In the Census Bureau’s 2009-10 survey, per-pupil spending was $16,841, No. 2 in the nation. Pennsylvania’s was a middle-of-the-pack $12,995. The local share of the Garden State’s education bill, 55.6 percent, also was No. 2 in the country.