What owners need to know about property taxes

February 3, 2021

Learn everything you need to know as a real estate investor about property taxes, their purpose, and how we can help

Owners of any residential property, whether it be a townhouse, a detached home, or a condominium, will have to pay property taxes. 

Experienced real estate investors are aware of property taxes and know that they’re an unavoidable part of the homeownership experience. However, it’s easy for new property owners and international investors to overlook their importance and impact. 

We’re here to help! Continue reading to learn everything you need to know about property taxes.

What are property taxes?

A property tax is an ad valorem tax on the value of a property, usually levied on real estate. An ad valorem tax is a tax based on the value of a transaction or property. The tax is levied by the governing authority of the jurisdiction in which the property is located.

This governing authority can be a national government, a federated state, a county or geographical region, or a municipality. Cities, counties, and school districts all have the power to levy property tax on all properties within their boundaries. For example, if you own a property in Orlando, you’ll owe a property tax to Orange County, but the municipality of Orlando sets the tax rate. 

What is the purpose of property taxes? 

Property taxes are levied by the local authorities to pay for their services. They are used to build roads, pay for public safety, schools, libraries, parks, public transportation, and so on… the list is very long! 

How are property taxes determined?

Typically, property taxes are calculated by multiplying the tax rate (sometimes called the mileage rate) by the current market value of your property. The market value is usually based on the land and the structures on it.

Property taxes are reevaluated every couple of years by a local tax assessor who determines how much your property is worth based on a variety of factors, such as location, size, and condition. Budget hearings are held by the county in order to determine how much money needs to be collected. 

What happens if an owner doesn’t pay property taxes?

If a homeowner doesn’t pay their property taxes, a number of things can happen. 

Failure to pay the tax could result in a tax lien (a legal claim imposed upon a property in order to secure tax payments) being placed on your property. This can result in you losing the property in a public tax sale.

Read more:

What is a Homeowners Association fee, and what does it cover?


How can a property management company help? 

At Rental Heroes, we help you manage all aspects of your property and are here to answer any questions and help you in any way we can.

When you choose Rental Heroes, you can enjoy peace of mind and know that we help to manage the property taxes on the properties you own, so that you can achieve your real estate investment goals.


Ready to choose the right partner in property management? 

Contact us today