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Assignment - As a homeowner in the City of Bloomington you are interested in calculating the Effective Property Tax Rate you expect to pay on your property. Based on the following information, calculate the ETR of your property for BOTH of the following scenarios. It is fine to work in groups but you must turn in your work and your work only.
Scenario 1) You know from government legislation that the legal tax rate on your property is 2.4% and the city's assessed value of your property is $155,000. However, your property is currently on the market for only $60,500 due to a significant downturn in the housing market. What is your Effective Property Tax Rate?
Scenario 2) You know from government legislation that the legal tax rate on your property is 2.4% and the city's assessed value of your property is $155,000. However, your property is currently on the market for $175,000 due to a recent boom in the housing market. What is your Effective Property Tax Rate?
Analysis: Compare and analyze the two ETRs. How did the change in market value affect the property ETR? Would you prefer your home to be undervalued or overvalued by government assessors before you pay your property taxes?
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