My Home Value Rose More Than $100,000 This Past Year. Here's Why That's Actually a Problem for Me

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  • Home values are up on a national level.
  • Because property values are higher than average in my area, I saw my home's value increase a lot over the past 12 months.
  • Not only does that increase not benefit me financially, it might actually end up hurting me financially, as I may have to pay higher property taxes.

Trust me when I say I'm not celebrating.

For many people, late November is one of the most celebrated times of the year. It's when the holiday season officially kicks into gear, when neighborhoods light up with shining decor, and when people are generally just in more of a giving spirit.

But in my neighborhood, late November wasn't such a great time of the year for a lot of homeowners. That's because we got our annual property assessment cards in the mail right around Thanksgiving time. And many of us saw numbers we weren't happy with.

I live in a part of the country where home values are higher than average. As an example, a $600,000 home in my neighborhood isn't particularly large or updated -- it's really your typical three- or maybe four-bedroom home. In another part of the country, $600,000 might buy you a mansion on an acre of land.

Because home prices are up on a national level and home values in my area are higher to begin with, a lot of people in my neighborhood saw their assessments increase by $100,000 or more this past November. And I was in that very boat.

Now you'd think that a higher home value would be something homeowners would celebrate. And some people may be happy about those higher numbers. Here's why I'm not.

I won't gain anything from a higher home value

If I were looking to sell my home, then I'd definitely be thrilled with a higher assessment, because it could easily make the case for a higher asking price. But I'm not selling my home.

First of all, I'm content where I am. And also, selling my home could mean having to yank my kids out of their school district and off of their sports teams. That's not something I'm eager to do.

Plus, home prices are up so much right now that even if I were motivated to move, and even if I were to sell my house at a nice profit, what I'd gain there, I'd end up spending on another overpriced home. Oh, and since mortgage rates are up, any new home would probably end up costing me a lot more -- even with a large down payment.

Not only am I not planning to sell my home any time soon, but I'm also not planning to tap my home equity for a loan or line of credit. So all told, the fact that my house is now worth a lot more doesn't benefit me in any way.

My property tax bill could go up

Property taxes are calculated by taking the assessed value of your home and multiplying it by your local tax rate. Now that my home is worth more money, my property tax bill could skyrocket unless my local tax rate goes down.

Now chances are, that rate will go down. A lot of homes in my area are up by $100,000 or more. And the tax rate in my town is high. But my township can't easily get away with jacking everyone's taxes up by $1,000 or more in the next year because it only needs a certain amount of money to meet its budgetary needs, so something is apt to give.

But all told, I'm pretty sure I'll be looking at some sort of property tax hike next year -- even if it's not a huge one. And since I already pay a lot in taxes, that's not ideal.

All told, a higher home value isn't something I'm thrilled about. If I were looking to sell my home or borrow against its equity, I'd feel differently. But for now, all I really have is a higher number on a piece of paper -- and the stress of a looming property tax hike hanging over my head.

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