With new builds, property taxes can change dramatically after purchase because initial rates are often based on estimates. Why property taxes can jump for new buildsWhen lenders qualify someone for a home purchase, they factor in the principal, the interest payment on the mortgage, homeowner's insurance and property taxes. Instead, mortgage lenders will often use an older tax rate from the area or an estimated tax rate to calculate the owner's monthly payment. watch nowInitially, the homeowner will typically pay the estimated property tax rate into escrow. Depending on the local tax assessment cycle, the county office will eventually assess the value of the new house to determine the actual property tax rate.

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Persons: homebuyers, Melissa Cohn, Brian Nevins, Cohn Organizations: Getty, National Association of Realtors, William, Mortgage, Bay Equity