Property taxes are one of the biggest factors affecting the true cost of homeownership in New York State — and Albany County is no exception. Whether you're comparing communities, budgeting your monthly payment, or figuring out how to lower your tax bill, this guide covers everything you need to know about property taxes in the Capital Region in 2026.
How Property Taxes Work in New York
New York property taxes are levied by multiple jurisdictions simultaneously — county, town/city, school district, and sometimes special districts (fire, water, library). This layered structure means your total bill can look complicated, but it breaks down into predictable components.
Your tax bill = Assessed Value × Tax Rate
The "assessed value" is set by your local assessor — in Albany County, most municipalities assess at 100% of full market value (full value assessment), which means your assessed value should roughly equal what you paid for the home. Tax rates are expressed in dollars per $1,000 of assessed value.
2026 Property Tax Rates by Municipality (Albany County)
Tax rates in Albany County vary significantly by location because the school district tax — the largest component — differs between districts. Here are combined estimated rates for common communities:
| Municipality | School District | Combined Rate (/$1,000) | Est. Annual Tax ($338K home) |
|---|---|---|---|
| Town of Colonie (Latham) | North Colonie | ~$21.50 | ~$7,267 |
| Town of Colonie | South Colonie | ~$22.80 | ~$7,706 |
| Town of Guilderland | Guilderland CSD | ~$24.10 | ~$8,146 |
| Town of Bethlehem | Bethlehem CSD | ~$25.40 | ~$8,585 |
| Town of Niskayuna (Schenectady Co.) | Niskayuna CSD | ~$23.60 | ~$7,977 |
| City of Albany | Albany City SD | ~$29.80 | ~$10,072 |
| City of Troy | Troy City SD | ~$27.90 | ~$9,430 |
New York STAR Exemption — Save $300–$1,500/Year
The School Tax Relief (STAR) program is New York State's most widely used property tax exemption. As a homeowner who occupies your home as your primary residence, you are entitled to a STAR benefit — either a check from New York State or a reduction in your school tax bill.
Basic STAR
Available to all owner-occupied primary residences with household income below $500,000. If you're a new owner, you register for the Enhanced STAR credit program — you'll receive a check from New York State rather than a direct assessment reduction.
- Available to all homeowners under $500,000 income
- First-time buyers register at tax.ny.gov/STAR
- No age requirement
- Value increases approximately 2% per year
Enhanced STAR
Available to homeowners age 65+ with household income at or below $107,300 (2026 limit). The Enhanced STAR provides significantly greater savings than Basic STAR.
- Must be 65 or older during the year
- Income must not exceed $107,300 (combined for all owners and spouses)
- Must submit annual income verification to the state
Other Property Tax Exemptions in Albany County
Senior Citizens Exemption (Additional 50% Reduction)
Beyond STAR, homeowners 65+ with income below approximately $37,000 can apply for a Senior Citizens Exemption that reduces their assessed value by up to 50%. Unlike STAR (which comes from the state), this is a local program — you apply at your town or city assessor's office by the annual deadline (typically March 1st).
Veterans Exemption
Albany County offers alternative veterans exemptions for eligible service members. The amount varies based on service type (wartime vs. cold war, service-connected disability), but typical savings range from $500–$3,000/year. Apply at your local assessor's office.
Agricultural Exemption
Properties used for active agricultural purposes in Albany County's rural towns may qualify for significant assessment reductions under the Agricultural Value Assessment program. Relevant for buyers looking at rural properties with land.
How to Appeal Your Property Tax Assessment
If you believe your home is over-assessed — your assessed value is higher than what you could realistically sell the home for — you have the right to appeal. Here's the Albany County process:
- Review your assessment notice. Albany County towns send assessment notices in May. Check it as soon as it arrives.
- Check comparable sales (comps). If homes similar to yours in size, condition, and location sold for less than your assessed value, you have grounds to appeal. Your realtor can pull comps for you.
- File a Complaint on Real Property Assessment (RP-524). This must be filed with your town's Board of Assessment Review before the deadline — typically the fourth Tuesday in May for most Albany County towns.
- Attend the Grievance Day hearing (or submit documentation) and present your comparable sales evidence.
- If denied, file with the Small Claims Assessment Review (SCAR) court — this costs $30 and is an informal hearing where you represent yourself.
Property Taxes and Your Mortgage Payment
Most lenders require that property taxes be escrowed — meaning 1/12 of your annual tax bill is collected with each monthly mortgage payment and held in an escrow account until the tax bills are due. On a $338,000 home in Latham paying ~$7,267/year in taxes, this adds approximately $606/month to your principal and interest payment. This is why understanding property taxes before you choose a neighborhood is so critical to budgeting accurately.
Use our mortgage calculator with property tax fields to model your total monthly payment including taxes and insurance for any community you're considering.
Questions About Property Taxes in a Specific Area?
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