What could be one reason that somebody decides to rent and not buy a home? BEWARE of Property Taxes and Insurance in Fort Collins! Compared to a mortgage that has multiple variable expenses, they may want to secure their rental rate for the next year.
One thing that people aren’t talking enough about is the aftereffects of this crazy real estate market boom. Today, we’re talking about property taxes and property insurance in Fort Collins.
Property Taxes Increase
We have seen 22% appreciation since June 30th, 2020 up until November 2021. Wondering why I use this specific range? Well, property values are assessed based on the prior year’s valuations. So specifically, our property taxes in 2022 got assessed based on the values that were given to them in prior year.
So it is an amazing thing for those that are homeowners! Yay! They’ve have amazing appreciation… Now comes the property tax increase!
We will see the property tax assessment rate stagnant at 7.15% which means as your property values increase, so will your property taxes. So… you should your property taxes to increase pretty dramatically here in the future.
Property insurance increase
Property Taxes are just one portion of your mortgage payment. Besides Principal and Interest, the other “I” in PITI is Insurance. Principal, Interest, Taxes and Insurance. So your insurance is a big part of your monthly mortgage.
We often talk about materials and labor shortages. It’s important to note that all those things are also increasing the cost of new construction and housing prices.
One of the biggest drivers of homeowner insurance is the reconstruction cost. So if it cost you $300,000 to rebuild your house in 2018, that could go up 10-15% which means around $345,000 valuation.
With that said, your property insurance premium is going to increase in tandem, which could be around a 10-15% increase in the property insurance in Fort Collins.
Final thoughts
Between property taxes and property insurance, you can expect your monthly mortgage to go up pretty significantly over the coming years. And I don’t foresee Fort Collins Real Estate going down anytime soon.
For a homeowner, it might a good thing to see an increase in appreciation, but on another hand, it will come with a few unexpected increases. BEWARE of Property Taxes and Insurance in Fort Collins!
If you need any help to make your decision or you have any questions about Fort Collins or Northern Colorado, please reach out!
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