Essex County 2023 Property Tax Rates: Town by Town guide
Property tax rates for FY 2022 for all 34 cities and towns in Essex County have been certified. The first table shows the tax rates in alphabetical order, while the second lists them from low to high.
Tax rates for each town
Alphabetically (download a copy of this table by clicking here) (more…)
How Marblehead’s 2023 Property Tax Rate is Calculated
The formula for calculating the property tax is: take the $ amount of the previous year’s Tax Levy, add 2.5% for Proposition 2 1/2, and also add any New Growth (such as new construction or a condo conversion). This figure is the new tax levy. To this figure is added debt service – the Principal and Interest payable on the town’s debt. – to produce the total Tax Levy.
The tax rate is then calculated by dividing the Tax Levy by the Assessed Value of property – and, crucially, that calculation is based upon prices as of January 1, 2022, using date from sales in calendar year 2021. What that means is that 2022 sales are used for the calculation of the tax rate in FY2024 – not FY2023.
Here are the numbers for Fiscal Years 2022 and 2023, remembering that FY 2023 runs from July 2022 to June 2023. (more…)
Marblehead 2023 Property Tax Rate
The 2023 Property Tax rate of $10.00, for both residential and commercial property, has been approved by the Massachusetts Department of Revenue.This compares with a rate of $10.52 for 2022 but, with assessments climbing, tax bills will -as usual – be going up.
I will publish my usual breakdown, showing how the tax rate is calculated, next week.
And these recent articles:
Economic and mortgage commentary
Why Mortgage Rates Will Fall (more…)
Marblehead 2020 Tax Rate drops sharply
This is a good news, bad news story.
The good news: the tax rate for Fiscal Year 2020 (July 1, 2019 to June 30, 2020) will drop from $10.74 to $10.39.
The bad news: taxes paid are going up. The median Single Family Home assessed value increased 7% from $630,000 to $674,000, resulting in a 3.5% increase in the median tax bill from $6,766 to $7,003.
Remember that assessments for 2020 are based upon prices achieved in 2018.
What about Prop 2 1/2, you may ask?
Prop 2 1/2 refers to the entire tax bill in dollars. Take last year’s taxes, add 2 1/2% plus new growth, add in the cost of debt exclusions, and that produces the dollar amount for the following year.
Now take that amount and divide by the assessed value to get the tax rate. That is the rough formula. In towns like Marblehead, there is one rate for all types of property. Other towns choose to tax commercial property at a higher rate.
But sticking to Marblehead, getting the dollar amount to be raised each year is fairly easy. The main variable is the assessed value. In a year when the assessed value goes up sharply, as in 2020 when the median assessed value will increase by 7%, the tax rate will go down, because one is dividing the dollar amount raised by a larger figure.
This simplistic table illustrates how the calculation is made:
The first column represents Taxes of $100,000 to be achieved from an assessed value of $10,000 (I am ignoring mill rates to make the example simpler). $100,000 divided by $10,000 produces a tax rate of $10.00.
The second column shows a 2.5% increase in taxes to $102,5000, and an increase in assessed value to $10,500. Divide one by the other and the tax rate drops to $9.76 – but the dollar amount raised goes up. This is the scenario in Marblehead for 2020.
The third column shows what happens if assessed values go down. The amount to be raised it still $102,500, but dividing this by the reduced assessed value of $9,500 produces a tax rate of $10.79.
The bottom line is that taxes paid nearly always go up. Not universally: in any year some will go up, some down and some stay the same.
But at least now you know that in all probability, when you get that tax bill just before year end, although the tax rate will be going down, your tax bill will be going up.
I shall publish a more detailed explanation of the 2020 Marblehead tax rate in due course, along with tax rates for all 34 cities and towns in Essex County as they are announced in coming weeks. Click Property Taxes to go to the section of the blog with information about property tax rates throughout Essex County.
Andrew Oliver
Market Analyst | Team Harborside | teamharborside.com
REALTOR®
Sagan Harborside Sotheby’s International Realty
One Essex Street | Marblehead, MA 01945
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How is Marblehead’s 2019 Property Tax Rate calculated?
This article, which explains how the tax rate is calculated, is a follow up to Marblehead 2019 tax rate drops to $10.74.
The formula is actually very simple: take the $ amount of the previous year’s tax levy, add 2.5% for Proposition 2 1/2, and also add any new growth (such as new construction or a condo conversion). This figure is the new tax levy. To this figure is added debt service – the Principal and Interest payable on the town’s debt.
Here are the numbers for Fiscal Year 2018 and 2019, remembering that the FY runs from July to June.
The Tax Levy calculation
The dollar amount raised by the property tax will increase year by year. That is because of the formula: last year’s number plus 2.5% plus new growth. In the table above you can see how the FY 2018 tax levy of $59,592,925 becomes the base for FY 2019. Add $1,489,823 for Prop 2.5% and $317,431 for new growth and the new figure is $61,400,179. To this number is added the debt service – Principal and Interest on the town’s debt, much as homeowners pay P&I on their mortgage – to give a total amount to be raised of $67,841,293.
The Tax Rate
The actual tax rate depends upon the total Assessed Value of all property: residential, commercial and personal. The tax rate is calculated by dividing the total dollar amount to be raised by the total Assessed Value of all property. Thus, while the $ amount raised by the tax (and therefore the average tax bill) will increase each year, the headline tax rate will fluctuate depending upon the direction of Assessed Values.
In simplistic terms, the $ amount raised before debt service will increase by a little more than 2 1/2% each year, so if the median Assessed Value also increases by a little more than 2 1/2% the tax rate will be unchanged. If the increase in Assessed Values is less than 2 1/2%, then the tax rate will rise. And if the increase in Assessed Values is more than 2 1/2% then the tax rate will rise. One other variable is the cost of debt service, which is currently projected to be stable for the next few years.
In FY 2018 the tax rate was $11.02, achieved by dividing the almost $66.3 million to be raised by the $6.0 billion of Assessed value. And in FY 2019 the calculation is $67.8 million divided by $6.3 billion, which produces a rate of $10.74. While the tax rate will decline in 2019, the median tax bill, based on the higher Assessed Values, will increase by $121, or 1.7%, to $6,766.
Note that the calculation of the tax rate is made simpler by the fact that Marblehead’s Board of Selectmen votes each year to have a single tax rate for both residential and commercial tax. In towns which elect to have a differential rate – i.e. by taxing commercial property at a higher rate than residential – there are generally two different tax rates, achieved by diving the amount to be raised from residential and commercial taxpayers by their respective aggregate Assessed Values.
How does debt service affect the tax rate?
The announced property tax rate announced each year includes the cost of debt service, which Marblehead tries to keep to 10% or less of the total tax bill. The first major reduction in debt service is not currently due until FY 2026.
What is the outlook for FY 2020?
The residential real estate market in Marblehead has been strong again in 2018 (and 2018 prices will be the basis for the FY 2020 tax rate). At this stage it looks as though the SFH median price will be around $690,000, an increase of about 4% from 2017’s $665,000. But bear in mind this is the median price of the roughly 210 SFHs that will sell this year out of the more than 6,200 SFHs in Marblehead. This does not imply that the Town’s Assessed Value will increase by 4%, including as it does all types of property.
Nevertheless, with debt service forecast to be similar to the FY 2019 level, it seems reasonable to expect that the tax rate in FY 2020 will be similar to that for FY 2019 or slightly lower.
www.OliverReports.com
How is Marblehead’s 2018 Property Tax rate calculated?
(Click here to download a pdf of this report.)
In my Marblehead announces 2018 Property Tax rate post this week I promised to write another article explaining exactly how the tax rate was calculated. This is it.
The formula is actually very simple: take the $ amount of the previous year’s tax levy, add 2.5% for Proposition 2 1/2, and also add any new growth (such as new construction or a condo conversion). This figure is the new tax levy. To this figure is added debt service – the Principal and Interest payable on the town’s debt.
Here are the numbers for FY 2017 and 2018, remembering that the FY runs from July to June.
The Tax Levy calculation
The $ amount raised by the property tax will increase year by year. That is because of the formula: last year’s number plus 2.5% plus new growth. In the table above you can see how the FY 2017 tax levy of $57,779,806 becomes the base for FY 2018. Add 2.5% and new growth and the new figure is $59,592,925. To both these numbers is added the debt service – Principal and Interest on the town’s debt, much as homeowners pay P&I on their mortgage.
The Tax Rate
The actual tax rate depends upon the total Assessed Value of all property: residential, commercial and personal. The tax rate is calculated by dividing the total dollar amount to be raised by the total Assessed value of all property. Thus, while the $ amount raised by the tax (and therefore the average tax bill) will increase each year, the headline tax rate will fluctuate depending upon the direction of Assessed Values.
In simplistic terms, the $ amount raised before debt service will increase by a little more than 2 1/2% each year, so if the median Assessed Value also increases by a little more than 2 1/2% the tax rate will be unchanged. If the increase in Assessed Values is less than 2 1/2%, then the tax rate will rise. And if the increase in Assessed Values is more than 2 1/2% then the tax rate will rise.
In FY 2017 the tax rate was $11.02, achieved by dividing the almost $64 million to be raised by the $5.8 billion of Assessed value. And in FY 2018 the calcualtion is $66.3 million divided by $6 billion.
How does debt service affect the tax rate?
The announced property tax rate announced each year includes the cost of debt service. As can be seen in the table below, while the tax rate from the levy to pay for town services has declined in recent years as property prices have increased, the cost of debt service has increased steadily, as we are paying for large ticket items such as the Glover School and Transfer Station.
What is the outlook for FY 2019?
The residential real estate market in Marblehead has been very strong in 2017 (and the 2017 median price will be the basis for the FY 2019 tax rate). At this stage it looks as though the median price will be around $660,000, an increase of over 6% from 2016’s $620,000. But bear in mind this is the median price of the roughly 230 SFHs that will sell this year out of the more than 6,200 SFHs in Marblehead, so does not imply that the Town’s Assessed Value will increase by 6%.
Nevertheless, with debt service at this time forecast to be similar to the FY 2018 level, it seems reasonable to expect a modest decline in the tax rate for FY 2019. But tax bills will continue to go up!
If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, please contact Andrew Oliver on 617.834.8205 or Kathleen Murphy on 603.498.6817.
If you are looking to buy, we will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Andrew Oliver and Kathleen Murphy are Realtors with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Marblehead announces 2018 Property Tax Rate
(Click here to download a pdf of this report.)
The property tax rate for Fiscal Year 2018 (July 2017-June 2018) will be $11.02, just a penny higher than 2017’s $11.01.
Here is a breakdown in recent years showing the impact of debt exclusions (for items such as schools and the new transfer station):
Source: Marblehead Board of Assessors
As usual, the Board of Selectmen voted to maintain the commercial rate at the same level as the residential rate.
The median Single Family Home assessment for FY 2018 increased 4.3% to $603,000 and the median tax bill for FY 2018 will increase 4.4%, or by $281, to $6,645.
I will provide more details, including a breakdown of how the rate was calculated, in a report this coming weekend.
Meanwhile, may we all have something for which we can be grateful this Thanksgiving.
If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, please contact Andrew Oliver on 617.834.8205 or Kathleen Murphy on 603.498.6817.
If you are looking to buy, we will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Andrew Oliver and Kathleen Murphy are Realtors with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Twenty Questions with the Marblehead Assessor
Tax bills went out Dec. 27. If you’ve ever wondered how those bill break down here is your answer.
The FY2017 (July 1, 2016 – June 30,2017) tax rate has been set at $11.01, down from $11.10 in FY2016. The median single family (SFH) assessment increased 6.1%, or $33,000, to $578,000, and the median single family tax bill increased 5.2%, or $314, to $6,364.
The commercial rate has once again been set at the same level as the residential rate.
Note that the tax rate includes the cost of debt exclusions (mainly for school construction and the transfer station) voted by residents. These account for $1.07 of the 2017 tax rate, up from $0.99 in 2013. Excluding voter approved exclusions, the tax rate fell from $10.11 to $9.94.
Marblehead’s 2017 tax rate will be the third lowest of the 17 North Shore cities and towns and the fourth lowest of 34 Essex County communities. The highest rate in Essex County belongs to Amesbury at $19.95; the lowest Nahant at $10.47; and the median is $14.41. Swampscott’s residential rate is $17.45 and it commercial rate $32.20.
Approximately 70% of Marblehead’s revenue comes from property taxes.
Real-estate assessments for Fiscal Year 2017 were mailed at the end of last year. Assessor Mike Tumulty answered questions about the process.
1. What is the timeframe upon which assessments are based?
MT. For FY2017, assessments are based upon values as of January 2016, using sales data for calendar year 2015. Sales that took place in calendar year 2016, therefore, will be the basis for the assessment for FY 2018.
2. What percentage of properties sells each year? (more…)
Marblehead has retained its AAA rating
As reported in this Marblehead Reporter article Marblehead garners AAA bond rating from S&P , Marblehead has retained its AAA rating for the 8th year in a row. Marblehead is just one of 46 out of 351 communities across Massachusetts that obtained AAA status.
Apart from the kudos of having a well-managed and well-run town, the AAA rating allows Marblehead to borrow at lower interest rates. Recently, the town sold $7.7 million in 20-year bonds at a true interest cost of 2.179 percent and $10.3 million in one-year bond anticipation notes at a true interest of 0.6603 percent.
Those activities raised long-term debt “primarily” for the landfill project, the Glover School Building project as well as short-term debt for the Gerry School Feasibility Study and the forthcoming new fire truck among other capital projects, according to Town Administrator John McGinn.
This sound financial management is a big reason why Marblehead residents enjoy the third lowest tax rate of the 34 cities and towns in Essex County.
If you are considering selling your home please contact me on 617.834.8205 or [email protected] for a free market analysis and explanation of the outstanding marketing program I offer.
Read Which broker should I choose to sell my house?
If you are looking to buy, I will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
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