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NEW BEDFORD — Real estate taxes on an average home are set to rise 4% to 5% next year, as a hot post-pandemic housing market continues driving residential property values.
Months after cutting proposed spending about 2% in hopes of curbing tax increases, the City Council on Tuesday night voted 6-4, with one member absent, to set the basis for two tax rates for residential and business property.
Both rates are projected to drop, but average taxes are projected to rise for residential property and fall for commercial and industrial, reflecting the change in the total value of those property types across the city.
The residential tax rate is projected to drop from $12 to $11.31 per thousand of valuation. But the total value of residential real estate, which makes up about 84% of the city tax base, has jumped more than 10%.
“Nothing you can do to offset that swing,” Chief Financial Officer Robert Ekstrom said in an interview. “It’s going to go up,” he said, referring to residential taxes.
When 2024 taxes were set, the average cost of a single-family home was $357,000 and the average residential tax bill was $4,284, according to figures presented Tuesday night by the city assessor and the chief financial officer.
The average 2025 home value — allowing for new growth — is put at $397,187 and the average bill projected as $4,490 with the new rate, an increase of $206, almost 5%. The average value without new growth is $393,232, which would mean an increase of $161, or nearly 4%.
The total value of commercial and industrial property has dropped nearly 2% and 7% respectively. The commercial and industrial tax rate is projected to drop from $24.96 to $22.85 per thousand.
Strictly speaking, councilors did not vote on the tax rate itself. They voted to establish a basis that the Massachusetts Department of Revenue uses to set the tax rate once it certifies property values next month. Tax bills will go out in January.
The council discussion would baffle anyone not versed in the esoteric formula used to set the total tax levy split between a residential tax rate, and a commercial, industrial and personal property tax rate.
Much of Tuesday night’s discussion focused on the burden to place on commercial taxes, expressed in terms of a “shift” away from a baseline in which the two rates are equal.
A “shift” of 1.73 — which was eventually approved — means that commercial property taxes will carry 73% more of the total burden than they would with two equal tax rates. New Bedford operates with a ceiling of 1.75.
Ward 6 Councilor Ryan Pereira said he usually prefers to give commercial properties a bit of a break, but in this case he argued for the maximum “shift” because those property owners were going to get a break due to the lower overall valuation of that property.
“The valuations are the biggest driver,” of taxes, he said.
At-large Councilor Linda Morad, who chairs the Finance Committee, argued for 1.72 to allow leeway as residential values continue to increase.
“If we adopt the maximum shift this year, there’s nowhere to go next year,” Morad said.
Morad noted the council’s budget cut of some $9 million in the summer, leaving an adopted budget of nearly $470 million.
“Think of what (taxes) would have gone up if we hadn’t cut,” she said.
The council has refused Mayor Jon Mitchell’s requests to restore roughly $4.4 million of that cut in supplemental appropriations.
Ekstrom has said that of the requested sum, 93% is in bills that the city is legally obligated to pay, including employee health insurance premiums and the cost of an audit. He said the city is trying to figure out how to manage this, but for now he’s projecting a deficit of $573,000.
All seemed to agree that home prices seem only to be headed in one direction.
Ward 5 Councilor Joe Lopes, who proposed the winning “shift,” said he’d seen a three-family recently sell for $569,000.
Pereira said he heard about a three-family in the North End selling recently for $630,000, and a multi-family with a bar on street level in his ward selling for $1.2 million.
“It’s unbelievable,” he said.
Email reporter Arthur Hirsch at ahirsch@newbedfordlight.org.
I am so sick and tired of residential real estate taxes continuing to go up. Especially for those of us home owners who contributed to society by working fulltime for 40+ years until retirement, we should be given a significant break. Our city leadership needs to all work together to figure out how to get that done. If they cannot do that, they should stop seeking reelection or donate their city salaries to a fund for distribution to the home-owning population I have identified.
If you really want to change the neverending increase in residential property taxes in New Bedford, Fall River, and every other city and town in Massachusetts that has multi-family properties, you and I, the New Bedford City Council, the Mayor, and the MA State Senators & Representatives, and demand Massachusetts change the antiquated unfair property tax laws so multi family homes that are not owner occupied are charged commercial property tax rates, after all, it’s no longer their “Home”, it’s a business that generates income like commercial properties.
Also, multi-family properties that ARE, owner occupied, like a three family home valued at $600,000, the owner occupied portion, (1rst floor unit) is taxed at the residential rate for $200,000 in value, and the two floors above that make up the revenue generating $400,000 in value is charged at the commercial tax rate, those two floors are a business to the property owner that should be charged at the higher commercial tax rate.
Here’s a perfect example of how unfair it currently is, I own and live in a single family home in New Bedford, it’s in great condition, completely remodeled with the interior and exterior is “like new”, and the assessed value is $400,000, my neighbor two houses up on the same street owns a 3 family home she inherited, it’s in average condition, dated with little to nothing new inside and out, so his property has an assessed value is $470,000, so my property tax bill was less than $240.00 than his last year, and it’s essentially a commercial property with 3 families paying $1,750 per month each, while generating 3 times the cost of trash and recycling collection alone, and those 3 families receive 3 times the the same other services that I pay basically the same property taxes for, police, fire, snow plowing, libraries, city parks, etc., etc.,…..How is that fair in any way?
Feel free to copy and paste the facts listed above and send a copy to your city councilors, Mayor Mitchell, the Representative and Senator who represent your districts, and the entire liberal socialist Democrat majority legislature in Boston.
Also, don’t forget to email, write a letter, or call your Ultra-Liberal Democrat Governor Healy who you voted for, and who is WASTING our tax dollars on ILLEGAL IMMIGRANTS while home owners like you and I figure out how much more in property taxes we’ll be paying next year. and if my pay raise will cover the property tax increase, income tax increase, and the increase in fees for everything, like drivers license renewal, registration renewal, annual auto inspection, etc., etc.!!!!!
Believe you me, it’s just going to get worse once federal funding is curtailed because of lack of cooperation with the incoming Trump administration these blue States will be suffering and it will fall on the taxpayers.
Absolutely!
I wonder what the expected cost of New Bedford property taxes, Massachusetts income taxes, sales tax rates, personal property taxes, and basically every tax and fee that will be increased just to cover the unexpected cost of having to educate all the children of illegal immigrants brought here to MA, and New Bedford since neither the “Sanctuary City & Sanctuary State” refuse to cooperate with the federal law enforcement agencies like ICE & ERO to deport them?
I’ll take care of that myself with a few calls once the REAL President takes office on January 20, 2025.
I can’t wait for the large numbers of illegal immigrants who will be reported in 2025, and their children who are bleeding our education system dry will be reported right along with them, as they should!!!
Bravo! Well said.
Tax Increases, there is no one to blame but Mayor John Mitchell, he has been in office for over 10 years, he creates the city budget, and not once has he done anything to help lower residential taxes or water and sewer rates. Even with $84 Million Dollars of ARPA money, nothing was done, and every year the city budgets have continued to get bigger. Go back, do the research, not once have you heard John Mitchell mention or address how he would help lower the tax burden on City Residential Taxpayers. All we have seen is more and more spending and a growing of city government. New Bedford Residents have had enough and it’s time for change in the corner office.
OK Folks, it’s time change the ever rising property tax bills to a downward direction at the ballet box at the next election.
Voting doesn’t change anything unless there’s a candidate who wants to serve as Mayor, and for every spring increase requested, there should be an equal cost cut to support it, otherwise it goes nowhere!
The New Bedford City Council is just as guilty of the never ending spending that results in annual property tax increases. In 2024 & 2025 both the mayor & city council continue to raise property taxes while doing nothing to cut costs, and it’s sickening already, the fools who make up the city council couldn’t care less about residential tax increases, and have ZERO fiscal fiscal responsibility, they should be thrown out of office along with the mayor and replaced by a city manager! Every year they spend our taxes as they see fit while no spending cuts are even considered.
They know how to spend the $Millions of dollars in ARPA funds on areas that don’t benefit all city residents, and more importantly, the tax payers who are forced to fund services for the welfare class, and the illegal immigrants who have no rights to anything New Bedford tax payers must pay for!!!!
I hope this tax increase, and the upcoming increases in water & sewer rates, property insurance rates, garbage collection costs, and finally, not one illegal immigrant child should be allowed to enroll in New Bedford public schools from Pre-K thru grade 12, all costs related to educating the children of illegal immigrants is not the responsibility New Bedford, and Massachusetts taxpayers!!!!!!
Best comment yet. Well said.
My taxes on a rental property increased from $ 496.71 to 631.86 .
My home property taxes went up. The value of my home increased 50,000.00