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Controlling The Costs of Home Ownership


Controlling The Costs of Home Ownership

While homeowners have been happy to see their home values increase over the last two years (by over 30% in many cases), that happiness may be short lived when our property tax values arrive in the mail.

With inflation putting a dent in our pocketbook for every thing we purchase today, including food, we want to help advise homeowners on how to control the cost of homeownership.

While the largest expense is your mortgage payment, property taxes and property insurance are the next two largest payments. If you do not watch these items every year, you can see these costs increase annually by 10%-20%.

There is a misconception that the tax appraisal represents the value of what a house should be sold for, and that is entirely wrong. Homeowners that are diligent in keeping their tax values low, will see a huge difference in the tax appraisal, verses what an appraiser hired to determine value for a bank loan will come up with. The goal is to always keep our tax appraisal lower than what you can sell your home for!

The tax authorities can legally increase your property values 10% annually, so if you are not diligent in monitoring this, before you know it, your tax values are higher than what you could sell your home for! Homes increase in value on average of 6%-8% in West Houston, so you can see where this could get out of control. The good news is that homeowners in Texas have the right to protest that value every year, but the deadline is May 15th or the 30th day after the notice of value was delivered to the property owner, whichever is later.

You have many options for protesting your taxes, ranging from doing it yourself in person or online, to hiring a property tax consultant that will only charge you if they are successful in reducing your values. The fee is generally 50% of the money saved.

Property insurance is another big expense that you should monitor regularly. Insurance companies are in the business to make money, and when they experience high claims in a specific zip code, they distribute that loss back to the homeowner through increased premiums.

Most homeowners pay their insurance through an escrow account held by the mortgage company, so this is easily overlooked. The mortgage company always sends a notice of an increased escrow fee if the taxes or insurance increase, but most homeowners don’t pay close attention to this. What seems like a small monthly amount could be substantial for the year.

If your insurance premium goes up, we advise that you get quotes from other insurance companies. You will be surprised at the savings you could find here!

Energy Realty has asked a professional Property Tax Consultant, Sylvie Novotny, and a professional insurance agent, Joy Knox of State Farm to present some tips on how you can lower the costs of these two big homeownership expenses.

We are dedicated to helping our clients throughout the lifetime of their homeownership and are pleased to offer this seminar free to all of our clients and agents. Join us for wine and nibbles on Thursday, March 30 at 5:30 at Memorial’s newest wine bar, Vin Santo at 12525 Memorial Drive. The presentation will be 6 – 7p.m., and then we will be available for questions.

All attendees will receive a complimentary movie pass for Energy Realty’s annual Outdoor Movie Night on May 6, benefitting Family Point Resources!