If you are interested in buying a new home in Rhode Island, you may be curious about how much you will pay yearly for real estate taxes in Coventry, Cranston, Providence, or another area. Below, you’ll find information about real estate tax rates in RI, how they’re calculated, property tax exemptions, and more.
How Much Are Real Estate Tax Rates in RI?
RI real estate taxes are a significant source of revenue for local governments. These taxes pay for law enforcement, schools, parks, infrastructure, and more.
Municipalities can set their property assessment systems and tax due dates under Rhode Island state guidelines. Because each county assesses and collects taxes differently, there’s no way to provide one tax rate amount that applies to all RI homes. However, Rhode Island’s average real estate tax rate is 16.93. The median yearly real estate tax payment in the state is $4,339.
Here is more information about RI residential real estate tax rates in municipalities across the state, with rates listed from least to greatest:
1. Little Compton – 6.04
2. Charlestown – 8.18
3. Narragansett – 8.86
4. Newport – 9.33
5. Exeter – 13.72
6. Bristol – 14.38
7. Pawtucket – 16.58
8. Smithfield – 17.13
9. Cranston – 18.00
10. Glocester – 18.44
11. Warwick – 18.73
12. Coventry – 19.40
13. Richmond – 20.62
14. Woonsocket – 23.75
15. Providence – 24.56
As you can see, real estate tax rates in RI vary significantly. Therefore, knowing your town’s rate and how residential property taxes are calculated is essential to homeownership.
How Are RI Real Estate Tax Rates Calculated?
Real estate tax rates are based on a property's "fair market value.” Rhode Island requires towns and cities to evaluate property once every nine years, and the assessed value must be updated in the 3rd and 6th years.
The home’s “assessed value” is the same as the fair market value in nearly all areas of Rhode Island. However, in Block Island, properties are assessed at 80% of their fair market value.
A municipality’s property tax rate is applied to the home’s assessed value to calculate the yearly real estate tax bill. Tax rates are stated in dollars per $1,000 of a property’s assessed value.
Using Coventry, RI, as an example, here is how real estate taxes are calculated.
Your Coventry residential real estate tax rate is 19.40, meaning you will pay $19.40 for every $1,000 of assessed property value. Let's assume your home has an assessed value of $200,000. Using Coventry’s tax rate, your RI real estate tax bill would calculate the following way:
$19.40 ÷ $1,000 = 0.0194
⬇
0.0194 x $200,000 = $3,880
So, you would pay $3,880 annually in real estate property taxes in Coventry, RI.
What Is the Rhode Island Homestead Exemption?
Some RI homeowners who occupy a residential property (single, two, or three-family home or residential condo) as their primary residence may apply for a homestead exemption. The tax credit varies among municipalities, ranging from a $720 “discount” to approximately a 5-45% tax credit.
The homestead exemption is available in the following municipalities:
· Central Falls
· East Providence
· Johnston
· Lincoln
· Narragansett
· North Providence
· Providence
· West Greenwich
· Woonsocket
Are There Any Real Estate Tax Exemptions for Veterans and Senior Citizens?
Veterans must have served during wartime in WWII, Korea, Vietnam, or another recognized conflict occurring after Vietnam. Veterans cannot have been dishonorably discharged. Additionally, some municipalities offer tax credits for veterans with a service-related disability or who were prisoners of war. Those who qualify must apply at their town tax assessor’s office and show the proper documentation (DD-214).
In addition, tax assessors in different municipalities offer property tax exemptions for senior citizens. Typically, homeowners that are aged 65 or older and occupy a residential property (single, two, or three-family home or residential condo) as their primary residence are eligible.
Lastly, there are a few more exemption programs available in some RI towns and cities. Check to see if you may be eligible for the following tax exemptions:
· Visually-impaired exemption
· Disabled exemption
· Hardship exemption
· Tax deferral
· Tax freeze
· Income exemption
Final Thoughts
Whether you’re moving across the state or are a soon-to-be first-time home buyer, we hope this real estate tax rate resource has been helpful.
Do you have additional questions about real estate tax rates in RI or questions about where to begin when buying a home? We are happy to assist you! Please feel free to reach out to us anytime – we are always just a phone call or email away.