In Philadelphia, PA, new property assessments were released in 2019, increasing values for residential properties. However, notices arriving in mailboxes failed to indicate the new property tax rate or a homeowner’s tax bill. If you’ve been considering selling your home, the last two years have been full of uncertainty.
Overall, Pennsylvania, the keystone state’s property tax rate, is higher than the national average. These vary from one area to another since each county has its tax assessment system. So how much is the Philadelphia property tax rate, and is it worth selling to leverage your home’s market value?
For a home worth $135,200 as of its median value, the rate is $1,236 per year. On average, that’s 0.91% of that property’s assessed market value. Philadelphia will conduct valuations for a fraction of its overall properties during property assessments. These include new constructions, renovations, expiring tax reductions, and subdivisions.
After two years of not conducting assessments, this city and county are ripe for real estate investments, and companies that buy houses Pennsylvania residents want are salivating. The market in Philly, which has always been favorable, makes it the best time for the sales of homes. This article will illustrate where Philadelphia County’s property tax rate is and whether it’s worth selling your home.
Breaking Down the Philadelphia Property Tax Rate
Philadelphia, PA, is one of the best real estate markets in the country with a sizzling hot demand temperature. That means that when we say we buy houses Philadelphia residents want, we mean it.
At the moment, buyers exceed sellers, making the supply of homes for sale unbalanced in this state. Prices are also nearly identical regardless of location, and competitive real estate offerings in metropolitan areas continue to push it higher.
Property tax rates are calculated and adjusted each year after the Office of Property Assessment or OPA. That’s derived from mass appraisals and not the individual price you paid for your home. To find the market value of your house, your total assessment is multiplied by a millage percentage of tax.
You’ll receive your updated appraisal in the Notice of Proposed Value as a property owner in the city of Philadelphia. These assessments are based on the age and size of your house.
Other considerations include your property’s condition, the value of a property, its location, and if it’s for residential or business use. Tax rate determinations for a home you live in will also be determined by the value of similar properties in the area.
Within Philadelphia County, the municipal and the county have their tax rates. These affect how much property tax you pay as a homeowner and are either expressed as a percentage or a millage rate. Another contributor to property tax rates is the school tax, which is 0.7681% in this city, seeing as there’s only one district.
In essence, factors that will influence how much property tax you pay in Philadelphia include:
Value of Your Property
Your property’s size, location, and all amenities influence its market value. In Philadelphia, your house’s current market value and the land it sits on are assessed values. In other places, your home’s older value, such as five or ten years ago, may be used, or a 10% portion of its value.
The Going Assessment Rate
Philadelphia County uses an assessment rate when calculating how much property tax you owe. If a full value is used, it’s assessed at 100%, while a tenth of the value means the rate is 10%.
Millage Rate
The millage or mill rate is used in some areas to calculate your property tax rate. For every $1000 of a Philadelphia homeowners property value, $1 is the mill rate. If the county’s mill rate is five, then you’ll pay $5 for every thousand dollars of your property’s value.
Percentage
A straight percentage assessment means that you’ll pay a 1.3% or 2.1% rate for every $100 of your property’s value.
Effective Tax Rate
The effective Philadelphia tax rate is calculated using the mill and assessment rates which aren’t 100%. An assessment rate of 75% or 0.75, with a mill rate of five or 0.005, results in an effective tax rate of 0.00375. For your property valued at $100,000, you’ll pay $375 in property tax.
Property Tax Rates by County in Pennsylvania State
In Philadelphia, local authorities determine the property tax rates depending on their revenue needs. Each county uses its unique system, so you can’t compare one location to another. It’s helpful to note that the effective rate equals the annual property tax, which is a percentage of your home’s value.
The average effective property tax rate for counties in Pennsylvania includes;
Adams County 1.45%
Allegheny County 2.01%
Armstrong County 1.86%
Beaver County 1.69%
Bedford County 0.92%
Berks County 2.09%
Blair County 1.18%
Bradford County 1.18%
Bucks County 1.55%
Butler County 1.27%
Cambria County 1.48%
Cameron County 1.73%
Carbon County 1.87%
Centre County 1.26%
Chester County 1.49%
Clarion County 1.19%
Clearfield County 1.35%
Clinton County 1.36%
Columbia County 1.16%
Crawford County 1.65%
Cumberland County 1.33%
Dauphin County 1.66%
Delaware County 2.12%
Elk County 1.52%
Erie County 1.91%
Fayette County 1.31%
Forest County 1.13%
Franklin County 1.21%
Fulton County 1.16%
Greene County 1.44%
Huntingdon County 1.05%
Indiana County 1.77%
Jefferson County 1.35%
Juniata County 1.13%
Lackawanna County 1.68%
Lancaster County 1.69%
Lawrence County 1.57%
Lebanon County 1.61%
Lehigh County 1.89%
Luzerne County 1.65%
Lycoming County 1.42%
McKean County 1.72%
Mercer County 1.38%
Mifflin County 1.66%
Monroe County 2.46%
Montgomery County 1.56%
Montour County 1.06%
Northampton County 1.99%
Northumberland County 1.24%
Perry County 1.34%
Philadelphia County 0.99%
Pike County 1.76%
Potter County 1.48%
Schuylkill County 1.64%
Snyder County 1.33%
Somerset County 1.23%
Sullivan County 0.91%
Susquehanna County 1.26%
Tioga County 1.35%
Union County 1.33%
Venango County 1.54%
Warren County 1.53%
Washington County 1.19%
Wayne County 1.38%
Westmoreland County 1.47%
Wyoming County 1.46%
York County 1.92%
Will Philadelphia Reduce Property Tax Rates By 2023?
Unlike other counties in Pennsylvania, Philadelphia isn’t required to adjust property rates when reassessing your property. That makes reevaluations revenue neutral, meaning that reassessments raise extra revenue for the city despite remaining the same tax rate.
Due to the pandemic, the city will forego property reassessments for taxpayers in 2022. As such, it’s bound to perform tax rate reevaluations next year, meaning rates will either rise or stay the same. The county’s personal property tax funds school districts, infrastructure, municipal projects, and public transport.
A homestead exemption may occur for a property that’s considered your primary residence. For your owner-occupied house, the county reduces the appraised valuation before property tax owed is calculated. It’s not too soon to determine the effect of property tax reassessments next year towards the current market landscape.
In February 2020, OPA launched the Computer Assisted Mass Appraisal System or CAMA. However, modeling calibrations and staff training were delayed by the pandemic, resulting in the shortened reassessment process. For the tax year 2022, the assessors are staying the course in readiness for the full procedure come 2023.
Should You Sell Your House in Philadelphia within This Season?
Home values have increased by around 12% in Philadelphia in the last year. That means it’s the best time to sell your house due to the strong sellers’ market. Pennsylvania State was the country’s hottest market for homes in 2021, with real estate prices appreciating by 11.86%.
The ultra-competitive market is one reason to sell now, but you can also take advantage of a low property tax rate. There are chances that rates will hike next year by a whole percentage point to above 4%. Many buyers may also leave the market due to high-interest rates on mortgages, reducing the number of offers you’ll get.
It’s also the time of year to sell your home in Philadelphia also counts. Spring is the king as the market is ideal for listing when there’s buyer’s activity. That’s not to say that other seasons are dead, but the springtime maximizes your chances of closure.
You want your property to sell quickly when you put it on the market in Philadelphia. In October, homes are bought 21 days sooner than at other times of the year. That means you should list your house in July using an average list-to-close time frame of four months. Keep a close eye on market trends, maximize the county’s market, and strategically sell fast.
Is It Worth Selling Your Home With the Philadelphia Property Tax the Way It Is?
When deciding to undertake the significant financial transaction of selling your property in Philadelphia, many considerations come into play. One of these is the rate of property tax the county expects from you, which you’ll also have to quote for buyers. As it is, this year provides the best market temperatures for listing your home due to a foregone reassessment of real estate tax rates.
The last time property reassessments were conducted, the tax rate increased by an overall 5%. That hiked the value of a median single-family by 3.9%. The longer you wait to sell, the more there’s a potential for a significant swing depending on the market’s movements. That’s because only property owners with changing rate values received notifications for taxes due in March this year. Avoid mortgage-paying trouble and sell your home today.
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