Central Ohio Real Estate Market News

Several years ago I began tracking the multiple real estate tax rates by school districts for Columbus suburbs. I did this so buyer clients could get a feel for differences that the tax bill portion of their mortgage payment would make to the affordability of the homes we would be viewing.

When buyers have a lender pre-qualify them, the lender will tell them the maximum home price the buyer can select. They’ll also give them a maximum monthly payment. Because the tax rates among school districts can vary quite a bit, a buyer who has been approved to buy an average priced home of $200,000 may be able to be approved for that home in one district but not another. The reason is that the monthly tax portion of the mortgage payment may put them beyond the ratio set by the lender.

The other issue that may come into play, is that a school district with “lower” tax rates, may have higher priced homes. The Olentangy school district is an example of this. This district’s rates are lower than some other established suburbs, but the average home price in the district is much higher. If a buyer is approved for only $200,000, they will be hard-pressed to find a home at that price in the Olentangy district, yet, may find many such homes in that price range in Worthington, even though Worthington’s property tax rates are much higher.

Here is the chart that I’ve prepared to visually show the differences to school district property tax rates by several suburban school districts. The bars within a district represent the various taxing entities within the school district. (click on the graph to enlarge)

Of course, it goes without saying that buyers should budget for their tax rates to increase over the years they live in the home. This is especially true for the newly developing areas, like the Olentangy school district, where the growth in housing has and is creating a need to build new schools.

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