Could rising property taxes tank the market?

[Charles Brucato]

Hello everyone. I am a young investor from Rochester, NY and currently under contract on my first property and throughout the home buying process this has been a question that I have been wondering. Obviously this is market specific, but in my county (Monroe) property taxes are ridiculously high (Over 3%) I have reason to believe that there are a lot of people out there (specifically young couples) who are overpaying for primary residences. For example, one house I checked out the property taxes were $1700 as it was a flip and was sold super cheap previously. They paid over 200 grand for the house and when they get reassessed taxes are likely to be over $500 a month. Thier monthly payment could end up being $400 a month more than they projected upon closing when they get reassessed and we have to assume the following:

1. This is definitely a primary residence NOT an investment property. The numbers would not make sense whatsoever if this was bought as a rental.

2. The average first time home buyer is not really paying attention to this. They see the monthly payment when they close, project they can afford it, and don't realize that it could go up in the future.

3. They could be potentially overextending their means with the monthly payment they currently are at. $400 a month extra could sink them. I'm not saying they are in this specific example because I do not know the buyers, but I'm sure there are many situations out there similar to what I'm describing.

As I said this is market specific. But I could see it getting ugly in areas such as my own where tax rates are high and the prices of housing is skyrocketing. Let me know what you think. I think that this could get a lot of people in trouble and could cause a lot of people to sell in the near future. I'm new to this after all, but just something I've been wondering.