Home values, tax rates and something to think about

[Texashiker]

Back in 2001, 2002 and 2003 I was doing computer work in a community called Kingwood Texas. The community was upper middle class, and what some people might call a "rich" area. People like George Zimmerman, owner of the mens warehouse and George Foreman owned homes in Kingwood.

One customer I was doing computer work for told me how he had retired from the telephone company and bought a home in kingwood to retire at. The problem was, his home value and property taxes were increasing at a rate that his retirement payments could not keep pace.

If the increases in property values and property taxes did not stop, he was going to have to sell his home and move.

The guy did not live in a mansion, the home was maybe a 2,000 square feet, at the end of a cul de sac, and had a nice pool.

We all like the idea of our home values going up. But once you are on a fixed income, that increase in value is a double edged sword. If your home value doubles every few years, your property taxes go up, but your retirement payments stay the same, you can expect your standard of living to go down.

Recently my wife and I asked for our home to be reappraised by the tax district. After the reappraisal, the value dropped by about 15k. We have no plans on selling the home, so the value is not "that" important right now. With the decrease in appraised value our tax rate dropped by a good bit, which means I get to keep more of my money.

Maybe we look at home values backwards? Instead of wanting home prices to go up, maybe we should want home prices to go down?

With lower home prices more people can afford to buy, and we have a lower tax rate then with a more expensive home.

 

[Zebo]

Thank republicans. All these little nibble away at you taxes, excise, sin, property, SS, utilities, etc they support so they can slash top marginal rates and inheritance taxes for their real constituency. Pay one way or another but civilization has to be paid for.

 

[DrPizza]

Local governments:
"Woohoo! Property values went up. By keeping tax rates constant, we'll have more money to spend!"

 

[cybrsage]

There are good and bad sides to the loss in value. Those who want or need to sell get screwed, but if you do as the OP did, you can save money.

 

[Slew Foot]

Local governments:
"Woohoo! Property values went up. By keeping tax rates constant, we'll have more money to waste"

ftfy

 

[sm625]

Yeah, there is a lot of tax-hiking going on so as to keep total revenue the same or increasing. It's really disgusting. I wish people would actually take 10 minutes to find out where their property tax money is really going. It is shocking how many public employees are being paid administrator-level salaries, and pensions! Most schools actually have more administrators and retirees than they do active teachers. For the children my frickin patootie. This is pure unabashed greed.

 

[Texashiker]

It is shocking how many public employees are being paid administrator-level salaries, and pensions! Most schools actually have more administrators and retirees than they do active teachers. For the children my frickin patootie. This is pure unabashed greed.

Just north of Jasper Texas is this tiny community called Brookeland Texas.

From what I heard, a couple of the administrators of the school make close to $100k a year. How does a rural (very rural) school district with no real tax base afford to pay a select few employees around $100k a year? Its like the school district is milking the tax base for everything they can get.

 

[EagleKeeper]

Local governments:
"Woohoo! Property values went up. By keeping tax rates constant, we'll have more money to spend!"

You want the services; the local government bodies needs to get the funds to pay for the services.

Add children into the school system, need to cover he cost of materials and teachers.

Upgrade parks; replace recreational equipment; need funds.
Road repairs and that traffic signal for the dangerous intersection; need funds

External costs go up; need to increase budget for those - need funds.

Local governments are usually not allowed to run deficits; so where doe the money come from. Taxes

Keep tax rate the same; lower the property values 10% and where does the government come up with the 12-15% needed to operate the following year.

 

[EagleKeeper]

Just north of Jasper Texas is this tiny community called Brookeland Texas.

From what I heard, a couple of the administrators of the school make close to $100k a year. How does a rural (very rural) school district with no real tax base afford to pay a select few employees around $100k a year? Its like the school district is milking the tax base for everything they can get.

People have the ability to re-elect the school boards. Apparently, the school system is operating just fine according to the local taxpayers.

 

[fskimospy]

If you don't like things the local government is doing, you have far more ability to change that than any other aspect of governance. Frequently small town local elections only have a few dozen or perhaps a few hundred votes. Committed groups with an agenda can absolutely seize control of them and make a change. So don't complain about it, do something!

As for people who complain that their property taxes have increased due to the tens or hundreds of thousands of dollars in additional wealth they have accrued, still not outraged.

 

[Gunslinger08]

I dislike property taxes. I realize they've been around for over 200 years in America, so they aren't going away, but I don't agree that taxes should be assessed on property that doesn't change hands. Localities need money - assess a local sales or income tax.

 

[fskimospy]

I dislike property taxes. I realize they've been around for over 200 years in America, so they aren't going away, but I don't agree that taxes should be assessed on property that doesn't change hands. Localities need money - assess a local sales or income tax.

Sales taxes fluctuate wildly in economic booms and recessions and they are hard to measure compliance with for localities with limited resources.

 

[PrinceofWands]

This is news how? Any person with an IQ over that of a kumquat has known this for 200 years. We've been fighting for more than a decade to finally get our 'values' down to reasonable levels. We already have a statutory cap on rates and increases in this state, which merely shifted the shiv to values instead. People need to learn to cap both simultaneously, AND preferably tie the caps in to individual income growth (ie the absolute dollar value of tax increases should not be allowed to exceed the average absolute dollar growth of wages).

 

[Texashiker]

assess a local income tax.

Absolutely not. The income tax was one of the stupidist ideas even.

In fact, a state income tax is prohibited by the Texas state constitution.

Tax revenue needs to be shifted back to an industrial base, and off the shoulders of the people.

A dwindling tax base is a hidden effect of free trade. When a factory closes and moves to china, the county or parish loses that tax revenue. The revenue then has to be shifted somewhere else.

This is news how?

Its not news, its a topic for discussion.

 

[BoberFett]

Thank republicans. All these little nibble away at you taxes, excise, sin, property, SS, utilities, etc they support so they can slash top marginal rates and inheritance taxes for their real constituency. Pay one way or another but civilization has to be paid for.

Inflation is a Republican concept?

Tax the rich as highly as you want, you can't support our bloated government on their income alone.

 

[Gunslinger08]

Absolutely not. The income tax was one of the stupidist ideas even.

In fact, a state income tax is prohibited by the Texas state constitution.

Tax revenue needs to be shifted back to an industrial base, and off the shoulders of the people.

A dwindling tax base is a hidden effect of free trade. When a factory closes and moves to china, the county or parish loses that tax revenue. The revenue then has to be shifted somewhere else.




Its not news, its a topic for discussion.

Ultimately, taxing business just raises prices. Shareholders aren't going to be happy with decreased profits, so the individual pays for it in the end, regardless of what you do.

If you're unhappy with tax rates, what we really need to do is vote in fiscal conservatives. The government needs to be reduced in scope. The federal government and most state/local governments are already operating in the red. We need a drastic rethinking of what government is "supposed" to provide for the people.

That said, I'm not terribly burdened by current tax rates, so I don't really have a dog in this fight. I actually supported a local measure this year to raise property taxes (yes, I don't like them, but they aren't going away) to give public employees their first raise in over 5 years. We already have some of the lowest public employee salaries in the nation (especially for teachers) and we're losing good people to other localities that pay 25-50% more. The measure didn't pass.

 

[BoberFett]

ftfy

Eh, I'd prefer to see all my taxes paid locally with a little trickling to the top rather than the other way around.

 

[Drako]

Absolutely not. The income tax was one of the stupidist ideas even.

In fact, a state income tax is prohibited by the Texas state constitution.

Why do you think property tax and use/sales tax are OK, but income tax is bad.

 

[Texashiker]

That said, I'm not terribly burdened by current tax rates, so I don't really have a dog in this fight. I actually supported a local measure this year to raise property taxes (yes, I don't like them, but they aren't going away) to give public employees their first raise in over 5 years.

Did you read the opening post? Did you see the part about trying to pay increasing property taxes while living on a fixed income?

You may not care about increasing property taxes right now, but what about when you retire and are trying to live on a fixed income?

 

[BoberFett]

As for people who complain that their property taxes have increased due to the tens or hundreds of thousands of dollars in additional wealth they have accrued, still not outraged.

/facepalm

The value of property increasing is not wealth. Nothing new was created. Increased wealth indicates that something of value was created. No, the increase we see in home prices is not increase in wealth, it's devaluation of currency. Nothing more.

 

[Drako]

You may not care about increasing property taxes right now, but what about when you retire and are trying to live on a fixed income?

This is exactly why income tax make sense. People who are actually making money at a job can afford to pay taxes. People retired on a fixed retirement income are the ones penalized when property and use/sales taxes increase, whether by inflation, or the tax rate itself.

 

[Gonad the Barbarian]

Thank republicans. All these little nibble away at you taxes, excise, sin, property, SS, utilities, etc they support so they can slash top marginal rates and inheritance taxes for their real constituency. Pay one way or another but civilization has to be paid for.

^MFing truth right there.

 

[Gunslinger08]

Did you read the opening post? Did you see the part about trying to pay increasing property taxes while living on a fixed income?

You may not care about increasing property taxes right now, but what about when you retire and are trying to live on a fixed income?

I agree with you - property taxes are bad and I feel bad for the fixed income people. The problem is that my mostly well-managed local government needs more money (due to large budget shortfalls at federal and state level) and sales/income taxes are complete nonstarters around here. So we either let teachers keep leaving without replacing them (with class sizes already in the mid to upper 30's), we move money around from other departments (which are already very cutdown), or we raise taxes.

Maybe there should be an income test for property taxes? I don't like property taxes, but they aren't going away. Maybe the best we can do is ensure that people aren't losing their houses or eating cat food because of property taxes.

 

[fskimospy]

/facepalm

The value of property increasing is not wealth. Nothing new was created. Increased wealth indicates that something of value was created. No, the increase we see in home prices is not increase in wealth, it's devaluation of currency. Nothing more.

This is obviously untrue.

The amount of wealth one has is (basically) defined by the amount of value that one controls. On a national or global scale something of value must be created for wealth to increase, but it's hilariously false that someone's personal wealth could only increase through the new creation of value. When your mom gave you $20 for your birthday you became wealthier even though you didn't create value to get it. Every time a home price increases $1, the person who owns that home becomes wealthier.

If housing prices went up at exactly the rate of inflation you would be correct that they were not experiencing a net increase in wealth. Home prices over the years have most certainly not done so however.

 

[Texashiker]

This is exactly why income tax make sense.

Income tax does not make sense, period.

If you want to tax value, then charge no tax if the property is valued below a certain amount. Then tax the mcmansions at a high rate.

We are also overlooking tax breaks for elderly, people with disabilities and veterans.