I recently took a trip to Wisconsin and was both surprised and shocked to see the price of homes. The surprise was that home prices in the metropolitan areas of Milwaukee and Appleton have gone down recently. The shocking reality, however, was the cost of property taxes. Residents of the Badger State pay more than 3 times what Colorado residents pay for similar homes. See the map below to compare the state-by-state ranking of property tax, from lowest to highest.
Property Taxes by State
My wife and I explored some neighborhoods, looking at historic homes in particular. Some of these homes were beautiful craftsman style homes. Frank Lloyd Wright was born and educated in Wisconsin, after all, and the availability of wood resources appears to have made home building and heating more favorable to larger dwellings than in Colorado.
We had a difficult time finding average homes above the $300,000 mark in Appleton, but the property taxes were high enough to rule out many less affluent home buyers. In a way, it reminded me of a costly homeowners association (HOA) payment, except the association in this case is the city and state.
Consider this home in Appleton priced at $235,000 with 4 bedrooms and 2 baths and 2,170 square feet. The prior year property taxes were $4,440, or $370 per month. With a 20% down payment and 4.1% interest, the mortage payment would be $908. In this case, the total is $1,278 per month excluding other costs like insurance, HOA, etc.. Compare the Wisconsin home to this one in Longmont priced at $358,000 with 4 bedrooms and 2 baths and 2,136 square feet. The prior year property taxes were $1,013, or $84 per month. With a 20% down payment and 4.1% interest rate, the mortgage payment would be $1,384 per month. For this Longmont home, the total is $1,468 excluding insurance, HOA, etc.
| City | House Price | Monthly Cost | Median Income | Percent of Income |
|---|---|---|---|---|
| Appleton, WI | $235,000 | $1,278 | $4,200 | 30% |
| Longmont, CO | $358,000 | $1,384 | $55,387 | 32% |
My point is that Colorado may seem expensive by comparing home sales prices alone. Combined with the property tax rates, Colorado doesn’t seem as bad as, say, New Jersey with a median home price of $315,900 and annual property taxes of $7,410.
I may be biased, but I think Colorado is the best place to live, all things considered. Sometimes it takes travelling to another state to realize just how good it is here. Anyone ever heard, “There’s no place like home.”?
