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Guest Post: House Values Fall 30%, But Property Taxes Keep Rising

Tyler Durden's picture





 

Submitted by Charles Hugh Smith from Of Two Minds

House Values Fall 30%, But Property Taxes Keep Rising

Even though home values have plummeted by a third, property taxes are increasing: welcome to the Great Middle Class Squeeze.

You might think that with home prices off by 30% or more since the housing/credit bubble popped in 2006, property taxes would have declined by a similar percentage. But you'd be wrong: they've gone up. As if the massive reduction in home equity wasn't enough of a blow to the Middle Class, they're also paying higher property taxes.

Though house prices have declined roughly 30% nationally since the 2006 peak of the housing bubble, property taxes have continued their decade-long rise, jumping $45 billion (over 10%) since 2008.

Local governments are responding to declining revenues by jacking up all taxes and fees. To counteract sharp declines in property values, municipalities are raising their property tax rates, squeezing more out of properties even as they drop in value. Though there are local variations, the result is the same: property taxes are rising.

In southern Washington, the rate jumped from $10.06 to $11.60 per $1,000 of assessed value--a leap of over 15% in one year.

Even as assessed valuations slumped by over 13% annually, property tax revenues statewide increased 2.1% to $8.8 billion--a $181 million increase to taxpayers. Though Washington state has limits on property tax increases, local government's property tax rates do not rise or fall with assessed value--they're set by budget requirements. So falling prices do not translate into lower property taxes.

In Oregon, a voter-mandated statute limits increases in assessed value to 3% a year. As a result, assessed values are still lagging market prices, which soared in the housing bubble. In Multnomah County, the average assessment of $174,000 is $100,000 lower than average market values. That means property taxes can increase 3% a year even as home prices slip. So property taxes won't fall until market values fall below assessed value, and that would require further massive declines in home prices.

In northern New Jersey, property taxes are rising by as much as 12% in some municipalities, after skyrocketing 80% over the past decade, far outstripping the consumer price index (31% rise) and household incomes (up 24%).

Nationally, property taxes now dominate local tax revenues. Property taxes tripled from 1990 to 2005 in Florida, for example; once the local government obtains that gargantuan revenue stream, it becomes the "baseline" for all future years.

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Local governments should go back to the revenues and budgets of pre-bubble years, but instead they are jacking up rates to maintain revenues, even as valuations have fallen off a cliff. Bubble-era prices and equity are gone, it seems, but bubble-era property taxes are here to stay.

According to U.S. Census Bureau data, the nation's local governments will collect an estimated $476 billion in property taxes in 2010--almost double total state income tax revenues of $250 billion and considerably more than total sales tax revenues of $286 billion. That means property tax revenues are 66% higher than sales tax revenues--$190 billion more a year.

A decade ago, property taxes were roughly equivalent to sales taxes. In 2000, property taxes totaled $247 billion and sales taxes came in at $223 billion-- a differential of roughly 10%. Sales taxes have increased by 28% since 2000-- roughly in line with the rise in consumer prices (as calculated by the Bureau of Labor Statistics).

Property taxes, meanwhile, have far outstripped inflation, soaring from $247 billion in 2000 to $476 billion in 2010--a gargantuan increase of $229 billion, or 92%.

State income taxes have risen nationally from $217 billion in 2000 to $250 billion in 2010, after peaking at $303 billion in 2008, just as the global financial meltdown began. That's a rise of $33 billion, or 15%--actually less than inflation, since income taxes have fallen substantially in the recession.

Add all this up and we can see that local governments have become far more dependent on property tax revenues than they were in 2000.

No wonder they're jacking up property tax rates.

California property taxes have been limited to 1% of assessed value by the voter-mandated Proposition 13, passed in 1978. Assessed value is limited to a 2% increase per year. Additional parcel taxes can be added only through voter-approved bond measures and "special assessment districts" which fund municipal water districts, libraries and other local government services.

But assessed values are re-set to market valuations when a property is sold. As millions of homes were sold during the boom years, the assessed value of those homes skyrocketed, reaping huge increases in property taxes for local governments in California.

A random selection of homes in the San Francisco Bay Area yielded these representative increases (addresses are not listed due to confidentiality concerns, but property taxes and sales figures are all public records, easily accessible on sites such as zillow.com.)

3 bedroom, 2.5 bath home, built 1924:
assessed at $270,000 in 2004, property taxes: $5,090
sold 2005 for $725,000: 2006 taxes: $10,997
sold 2010 for $540,000, 2010 taxes: $12,193

Once this home was sold at a bubble-era valuation, then the property tax more than doubled, and then rose 10% from 2006 to 2010 as local "special assessment districts" levies increased.

Now that the home has sold for $185,000 less than its tax assessment (a drop of 25%), then the property taxes collected will certainly decline by a similar percentage. Multiply that by hundreds of thousands of homes sold for less than bubble-era valuations, and it paints a bleak picture of major declines in property tax revenues for local government.

Homeowners in many locales can petition the property assessor's office to lower the assessed value of their homes; if granted, such reductions in value can substantially lower property taxes.

This is no guarantee that your property taxes will stay low for long, though. Anecdotally, one reader from a state without Prop 13 limits wrote that he petitioned the county for a reduction based on lower valuation, which was duly granted. But that $1,200 reduction was largely offset by a $700 increase resulting from a higher tax rate.

Again turning to California for an example, a 3-bedroom, 1.5 bath house built in 1928 saw its assessed value leap more than ten-fold when it was sold for $770,000 in 2006. Property taxes leaped from $2,522 to $11,394. But the assessed value was notched down from $801,000 in 2008 to $630,000 in 2010 as an adjustment to the realities of post-bubble valuations. Though the value dropped 21%, the property tax only slipped to $10,035, a 15% reduction.

That's still quite a leap still from the pre-bubble annual tax of $2,500.

Either by re-assessment or by sales, assessed property values are falling around the nation. While local government can jack up tax rates by 10% or more annually, at some point those substantial increases will likely trigger resistance from homeowners who continue to see their home values stagnate or decline.

The property tax cash cow will likely get leaner as a result, and local governments will have to slim down budgets to match the new realities of lower property values.

Here's a simple suggestion for local government: go back to the pre-bubble budget of 1996, and add in the inflation since then--39%. That would be fair and transparent.

 


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Wed, 12/22/2010 - 18:49 | Link to Comment atomicwasted
atomicwasted's picture

Here's the catch-22 for property tax: you can appeal your property's valuation (at least in the State of California), and the tax authorities are actually pretty reasonable about reducing the tax base of your house in line with valuations in your neighborhood.  Except, after you've done that, you may suddenly be over 80% loan-to-value on your house again, and your lender isn't going to like that.  Your lender particularly isn't going to like that if you go over 100% LTV on that property.  As a result, you may get forced into PMI which could end up costing you as much as the savings you got on your property tax.

Wed, 12/22/2010 - 19:02 | Link to Comment -Michelle-
-Michelle-'s picture

Forced how?  Sure, they can send the bill.  Doesn't mean it will get paid.

What are they going to do?  Foreclose?

Wed, 12/22/2010 - 19:51 | Link to Comment Id fight Gandhi
Id fight Gandhi's picture

That's cute with the pmi. But I agree, a current mortgage shouldnt have any issues.

Perhaps if you tied in your mortgage payment with taxes. Which you never should do, pay taxes separately.

Wed, 12/22/2010 - 21:14 | Link to Comment QQQBall
QQQBall's picture

I have NEVER heard of a tax appeal impacting the loan status. Prove that a lender can force you to get PMI as a result of a tax appeal or just the basic decline in value.... I have gone against the Assessor's Office on tax appeals as a representative for the property owner and they are kinda reasonable, as long as you roll over and take their adjusted number.  They get less reasonable the lower you go, but the bottom line is that Market Value is Market Value you are entitled to a lowered assessed value. 

Wed, 12/22/2010 - 23:12 | Link to Comment Village Idiot
Village Idiot's picture

"I have NEVER heard of a tax appeal impacting the loan status."

you are correct, one has nothing to do with the other.

Thu, 12/23/2010 - 01:42 | Link to Comment Gargoyle
Gargoyle's picture

I have never seen a lender force borrower-paid MI after origination. I do know for a fact that lenders insure the loans in a particular pool all the time, and do NOT want the borrower to know about it.

Thu, 12/23/2010 - 04:33 | Link to Comment ebworthen
ebworthen's picture

So you're saying I'm damned if I do and damned if I don't?

Yeah, it's the state, and they can do it...until it doesn't work anymore.

Wed, 12/22/2010 - 18:51 | Link to Comment Motorhead
Motorhead's picture

Isn't it morbidly fun watching the USSA just fucking (self-)destruct before your very [four] eyes?!?

Wed, 12/22/2010 - 18:53 | Link to Comment molecool
molecool's picture

In the U.S. if there is a decision to be made the short term convenient is chosen over the long term sustainable path every single time.

Wed, 12/22/2010 - 21:48 | Link to Comment Vagabond
Vagabond's picture

Does the junker have a counter-example?

Thu, 12/23/2010 - 00:36 | Link to Comment Aristarchan
Aristarchan's picture

I guess I will watch it on the telly...if it doesn't conflict with Dancing With the Stars.

Wed, 12/22/2010 - 18:51 | Link to Comment molecool
molecool's picture

The longer I live the less I want to participate in this system. The middle class is being milked left and right - how much more blood can they squeeze from a dry rock?

It's time to leave this country - I don't mind paying taxes but want to see it put to reasonable use and not wasteful spending as well as bankster bailouts.

Wed, 12/22/2010 - 19:19 | Link to Comment Farcical Aquati...
Farcical Aquatic Ceremony's picture

Correct. It's time to leave. On one side, you have an elite flaunting their power like a peacock in heat. Absolute hubris. And on the other side, the middle class... And most of the middle-class people I talk to love it. When it all falls down, these people will not only accept it, they will embrace it. They love the security of TSA screenings. They believe that, at the very least, we got into those foreign wars for the right intentions. And didn't we do lots of good for all the Iraqis and Afghanis? And, honestly man, where would we all be now if the banks had been allowed to fail?! <sarc off>. We're in the minority here. Time to face it.

Wed, 12/22/2010 - 19:43 | Link to Comment lynnybee
lynnybee's picture

bingo.  believe this ..... my husband is threatening to have me committed to a mental facility, my kids think i'm nuts, my sister has told me to "stop it ..... get off the damn internet !" & I've lost what few friends I've had because of this "economic collapse / country collapse" stuff.   In fact, I got an email today from an acquaintenance telling me that it's all in my head & I need to open my heart to love & healing !!! ........... If this country doesn't collapse within the next few years I won't be able to show my face in public !  

Wed, 12/22/2010 - 20:15 | Link to Comment knukles
knukles's picture

And if it does, there won't be any public in which to show your face.  Catch-22.

Wed, 12/22/2010 - 20:46 | Link to Comment Monetary Lapse ...
Monetary Lapse of Reason's picture

There is a thread on ChrisMartenson.com for enrolled members now called, "Dealing with a reluctant partner".

http://www.chrismartenson.com/blog/dealing-reluctant-partner/49618

Come join us there.. you will have plenty of company.  I'm among the lucky ones... have 50% of net worth in PM's and food for four for six months in the basement with my wife's support.  Oh... got a 20G Mossberg and HiPointe 9mm carbine too.      

Wed, 12/22/2010 - 20:59 | Link to Comment SteveNYC
SteveNYC's picture

You'll ultimately be correct Lynnybee, timing is the bitch however. Take appropriate measures to protect you and your family, but let go of your emotional attachment to what may happen, and when.

Breathe the air, smell the trees and flowers, laugh, enjoy yourself, don't be a consumer whore and waste your money on shit (you don't strike me as the type).....economic collapse or not, let it be.

Good luck to you.

Wed, 12/22/2010 - 21:30 | Link to Comment Ricky Bobby
Ricky Bobby's picture

lynnbee I am sorry and it is not your fault. The conditions of perception are unpredictable, they swirl and spin in torrents and move in unpredictable ways. I am sure you followed your heart, your instincts and common your sense and this is where it led you.

Wed, 12/22/2010 - 21:49 | Link to Comment Thomas
Thomas's picture

Lynn:

My pessimism started in June 1998. I can assure you that you will go through phases. Sounds like you are in the preachy phase. It will pass as will the hyperventillations. At some point, you find yourself acting like Bill Bonner: sitting back and smirking at the insanity. It takes years to get desensitized but it is cathartic. Have I sold my gold, rice, and beans? No way. I just am at peace with having them.

Wed, 12/22/2010 - 23:46 | Link to Comment delacroix
delacroix's picture

lynnybee, you may be the only sane person in your family. i've had a similar response, although 1 aunt is coming around, and told me she could see what I was saying 2 years ago, coming true now, and asked me what I thought she should do. you already know what I told her. hang in there.

Thu, 12/23/2010 - 02:27 | Link to Comment dark pools of soros
dark pools of soros's picture

tell her to empty her jewelry box at the mall cash-for-gold shop and max leverage NFLIX!!!!!  before it's too late!

Thu, 12/23/2010 - 01:48 | Link to Comment aerojet
aerojet's picture

If you're driving them nuts with it, then it is you you needs to stop it.  The collapse could come, but it might happen 20 years from now.  How would you feel if you waste all that time?  Just accept that you cannot control the system.  You can only react to it.

Thu, 12/23/2010 - 03:07 | Link to Comment Peak Everything
Peak Everything's picture

Similar situation...

Am studying more history and am coming to the conclusion that although we see things correctly but it may take longer to crash than we think.

For example (approximately), Germany spends too much on WWI, has too much debt, and decides to print rather than cut expenditures. 5 years later hyperinflation explodes. 2 years later deflation. 3 years later great depression. Get evil strong man leader. 10 years later WWII. 5 years later lose war, then regain sanity.

Just about finished the book "When Money Dies: The Nightmare of the Weimar Collapse" by Adam Fergusson. Highly recommended. It's amazing how long crazy things can go on before they correct or explode.

Thu, 12/23/2010 - 04:41 | Link to Comment ebworthen
ebworthen's picture

Do you remember Cabbage Patch Dolls and Furbies?

It's like that.

"The economy is recovering"

"Everything is fine, doesn't it LOOK the same?"

"Look, it rolls it's eyes and makes noises."

"Look, it's roly-poly and pudgy and soft."

Everyone agrees it is so cool, everyone agrees it is the "must have" gift.

lyynybee - you are a sane person at a Pet Rock convention.

Wed, 12/22/2010 - 19:50 | Link to Comment chopper read
chopper read's picture

i agree.  i have one side of my family cheering on the military industrial complex and the other cheering on the welfare state.  both are livestock to the international banking cartel and cannot hand over their civil liberties quickly enough.  the programming and assigned enemies of the whole charade is laughable.  there is absolutely no critical thinking taking place, and everyone believes the U.S. Constitution is there simply for convenience when they want to make a point against the other political party.  Hardly anyone wishes to defend the Constitution if they feel they can benefit in the short-term from trampling on it.  There is no long-term thinking of the consequences.  i'm fed up.  how do i get my gold, my wife, and my kid out of this place?  its absolutely filled with arrogant lunatics who are begging to be marched off to FEMA camps and gassed.  The level of trust given to the Federal government here is spellbinding.  please, stop the ride.  i want to get off.

Thu, 12/23/2010 - 02:28 | Link to Comment dark pools of soros
dark pools of soros's picture

+1000 lemmings

Thu, 12/23/2010 - 09:26 | Link to Comment fiftybagger
fiftybagger's picture

Well look at it this way.  They are going to get what they deserve aren't they?

 

3 A prudent man foreseeth the evil, and hideth himself: but the simple pass on, and are punished.

Proverbs 22
King James Version

Thu, 12/23/2010 - 21:17 | Link to Comment chopper read
chopper read's picture

not a religious man exactly, but i do love a bit of wisdom from the assembled bible. those are some well-placed pearls. thanks. 

Thu, 12/23/2010 - 10:05 | Link to Comment Farcical Aquati...
Farcical Aquatic Ceremony's picture

Nice to see all the responses. Glad I'm not alone. Wish we could all meet, but we'd be put on an FBI suspicious list. See you all in Panama, or Chile, or Uruguay one day.

Thu, 12/23/2010 - 21:21 | Link to Comment chopper read
chopper read's picture

+1

Wed, 12/22/2010 - 20:28 | Link to Comment ExploitTheMarket
ExploitTheMarket's picture

Agreed, we are the minority who have taken the red pill....Personally I can no longer even tolerate the stupidity of the vast majority of people I used to hang around with. I have gotten into some very spirited discussions with many people over the last few years, and it seems like the more I prove to them how wrong they are, the more they cling to their bad ideas--the tendency to be consistent in beliefs even when they do not correspond to objective facts (are false) runs very strong in the majority of humans....

Wed, 12/22/2010 - 21:02 | Link to Comment SteveNYC
SteveNYC's picture

You should read Cognitive Dissonance's posts. They will show you why your family and friends are the way they are. Mine are the same, no worries there. Just proceed, taking the red pill was the best thing I ever did. No going back.

Wed, 12/22/2010 - 22:05 | Link to Comment comfortablynumb
comfortablynumb's picture

5 years ago, fresh out of college, I was pushing IRA rollovers on retirees and providing investment advice to several 401(k) participants in fortune 500 companies.  Things were fucked then and even more so now.  But it took me listening to the pain and suffering of others (i.e. begging for additional loans on 401(k)'s/hardship withdrawals) to figure out there was a major problem, then I dug deeper and deeper down the rabbit hole.  People won't wake up until shit hits on a very personal level.  But, just because people may laugh at "the red pill takers" now doesn't mean that our message isn't sitting in the back of their mind.  Ideas, beliefs, thoughts can all fester in the back of the mind.  A lot of them just need that moment, that event to bring those thoughts to the forefront, to a higher level of priorty.  It's coming, patience is required in this mission.   

Thu, 12/23/2010 - 01:48 | Link to Comment Gargoyle
Gargoyle's picture

Well said.

I live in a very liberal town, at a Festivus party the other night a guy whispered in my ear that "I was right about Obama".   He couldn't say it out loud, but he sacked up to tell me as soon as he saw me.

It's festering, all right.

Thu, 12/23/2010 - 21:40 | Link to Comment chopper read
chopper read's picture

they cling to their baneful labels at the expense of reason, and are easily manipulated as a result.  when they define their entire sense-of-self by a chosen label, they become blind to all other viewpoints. 

 

Wed, 12/22/2010 - 19:39 | Link to Comment lynnybee
lynnybee's picture

 The longer I live the less I want to participate in this system. The middle class is being milked left and right - how much more blood can they squeeze from a dry rock?     my thoughts exactly !   i don't know who junked you, but, this is the truth !!   I read (do not remember where, cannot reference it) that in the 1950's only 1/2 of the families income went to necessities & the other 1/2 was discretionary money that was either saved in a bank, spent or directed to larger purcheses..... family vacations, appliances, auto.    ....... & THAT WAS WHEN THE FAMILY HAD JUST ONE BREADWINNER..... MOM STAYED HOME TO RAISE THE KIDS & DAD BROUGHT HOME THE INCOME !!!   .... nowadays it's just never enough, no way possible to pay for all the bills with two people working / earning lower wages.......... END THE FED.

Wed, 12/22/2010 - 19:55 | Link to Comment Id fight Gandhi
Id fight Gandhi's picture

I agree completely. I want to leave rather than endure anymore. Its the morality decline, the crime, the expense of living as a debt slave.

I wish for the days of the 50s, 60s saw men on the moon, Concorde flights, everything was getting better.

Is aussie land any better?

Wed, 12/22/2010 - 21:05 | Link to Comment SteveNYC
SteveNYC's picture

Very expensive down there too. Sure, you get paid better, but two incomes is the necessary norm for a middle-class family to get by. You'll pay less for university, healtchare, and you'll get more time off work and generally cleaner air....

.....but debt levels are massive, things are expensive, and if you don't work in mining, good luck to you getting by!

Thu, 12/23/2010 - 02:18 | Link to Comment aka_ces
aka_ces's picture

yes, but one tends to forget that life in the 50s & 60s was under constant threat of Mutually Assured Destruction, which almost triggered during the Cuban Missile Crisis, and perhaps on other occasions too.  Despite all the systemic safeguards, probably just dumb luck it didn't happen, seems to me.  Not that equivalent possibilities aren't queued now too.  

Thu, 12/23/2010 - 02:46 | Link to Comment dark pools of soros
dark pools of soros's picture

+ 1 constant boogeyman!!

Thu, 12/23/2010 - 11:51 | Link to Comment Fearless Rick
Fearless Rick's picture

MAD was fucking overkill propaganda by TPTB. The USA and USSR were never going to wipe each other off the earth for the very reason that it was end-game, and the one thing politicians won't do is voluntarily give up their power.

I grew up in the 50s and 60s and am fortunate to actually be living in that very house of my childhood. Maybe a little history lesson is in order.

My father bought the 3BR, 1B house in 1958 (I was 4) for $17,500. Over the years, he made some nice additions and improvements. In 2006, the house was assessed at $124,000 (a bit extreme, IMO). Since the late-1970s the house has had no improvements except routine maintenance. Taxes are a whopping $5200 a year, meaning in just over three years time, the taxes equal the original purchase price of the home. How many times over has this house been paid for?

The house is in foreclosure due to my father's death in 2009, and a Cuntrywide mortgage he took out in 2007, which is super-loaded with fraud, from the assessment (120K) on. After his death, I had the house appraised. $81,500, the exact amount outstanding on his loan. That's when I decided, as estate executor, to default.

What changed since the 60s? My father worked, mom never did. In 1971, Nixon closed the gold window and it was off to the races for the taxing authorities and inflation. Two job households became the norm, befitting the wishes of the enslaving class. If women were allowed to vote, make them work and tax them too.

Now, it's a race to see who gets the property first. BofA is stalled on the FC, but the tax authorities are sending warnings. 2010 taxes are unpaid, but that's being remedied via payments and fighting the assessment. (BTW: Monroe Co., NY has the highest taxes in the country).

My question, when does it end? How much does the town, county and state have to bleed from property owners? And how in the world do they - other than by decree - have the right to take the property for non-payment of hugely-inflated taxes? They already have taken many times over the base amount of the land and home, and if I'm late, interest runs at 9%.

If they take the house, will the bank want it, with $6-9K in back taxes due and 15K of repairs needed (minimum)? Doubt it. So, they will sell it for $50K, tax it at a higher assessed rate and rape the new owners. In the current environment, with hundreds of houses for sale just in this town, I believe it will sit for years, the authorities getting nothing.

Time for a reset. Time for the middle class to own homes and stop paying retirement pensions for people who haven't worked in 20 years, ridiculous salaries and benefits for govt. employees and let's not forget the outrageous school taxes. I never went to public schools and have no kids, yet my father paid school taxes for 50 years. enough is enough. Wake the fuck up.

The 50s and 60s WERE better because we had an honest economy, fair taxes and limited government. I long for the days when our only enemies were the big, bad Soviets.

 

Thu, 12/23/2010 - 12:15 | Link to Comment Thisson
Thisson's picture

Well, the property tax revolts are starting:

http://globaleconomicanalysis.blogspot.com/2010/12/miami-dade-mayor-faces-recall-over-tax.html

So I think government has maxed out on what it can charge taxpayers.

Next up: debt defaults and politicians campaigning on reducing property taxes.

Thu, 12/23/2010 - 22:07 | Link to Comment chopper read
chopper read's picture

thanks for posting, Rick.  our Founding Fathers are turning in their grave.  to think that folks are being put out on the street because of taxes.  we were meant to own our property outright in a free country.  now, freedom is gone because of creeping government and a private monopoly on the tradable/taxable money supply.  its out of control. 

Thu, 12/23/2010 - 01:33 | Link to Comment Money Squid
Money Squid's picture

Hi Lynnybee - here is a link to great video of Elizabeth Warren regarding the decline of the middle class.

http://www.youtube.com/watch?v=akVL7QY0S8A

You can skip the first five minutes. Ms. Warren describes in detail the very same obserations that your average employee could afford a house, wife, car, two kids, health insurance and send the kids to college. Today, a husband and wife working can not support two kids, own a home and a car. Ms. Warren's data analsys is thorough and very interesting. I recommend you watch it, and if you want to politely recommend it to your friends.

Thu, 12/23/2010 - 01:52 | Link to Comment aerojet
aerojet's picture

That's bullshit.  I support my wife and two kids on one income.  The whole thing is more about self-reliance and smart budgeting than anything else.  We go without certain luxuries, but believe me, we aren't hurting for much of anything.

Thu, 12/23/2010 - 02:48 | Link to Comment dark pools of soros
dark pools of soros's picture

Happy Meals Forever!!!!

Thu, 12/23/2010 - 03:52 | Link to Comment UninterestedObserver
UninterestedObserver's picture

LMAO and so you are doing it on 50k right? Yeah didn't think so....

Thu, 12/23/2010 - 08:31 | Link to Comment -Michelle-
-Michelle-'s picture

Not 50k, but 60k here.  And almost half of our take home goes to the mortgage.  We bought on two incomes so the mortgage was only 25% of take home, but circumstances led to me staying home and recognition that this was the way it should be led to me remaining at home.

It can be done.  We have no debt except for our house.  We have a budget and we stick to it. 

Thu, 12/23/2010 - 21:26 | Link to Comment dark pools of soros
dark pools of soros's picture

+4 WalMart Wardrobes

Thu, 12/23/2010 - 21:48 | Link to Comment -Michelle-
-Michelle-'s picture

Nope.  We buy simple clothes in classic styles that are good quality, even for the kids since they can be handed down.

Disposable clothes are impractical and a drain on the budget.  My next step is learning to sew.

Thu, 12/23/2010 - 04:45 | Link to Comment ebworthen
ebworthen's picture

Everything is relative.

Look at figures for median income versus living costs.

Also, share your income and expenses, or ratios.

Wed, 12/22/2010 - 20:17 | Link to Comment Chappaquiddick
Chappaquiddick's picture

There is nowhere to run to - what you're running from is a manifestation of the energy crisis (obviously coupled with some high grade corruption and decades of mismanagement and missed opportunity, overlayed with dogma and heaps of dog doo) but a decade from now with the world at war and 20 years from now in the midst of the mad max decent - assuming you haven't topped yourself or starved to death, you'll look back to these days and wonder why the fuck all you ever did was complain.  This is our ultimate peak - we go no further than this - marvel at it, it'll be dust in no time at all.  And as for leaving - you need to look for a place to make your best stand from.  If for you that's overseas, great.  I'm still searching but I know based on my urban space that we have to move - here is simply not sustainable heading into the decent.

Wed, 12/22/2010 - 20:30 | Link to Comment Bearster
Bearster's picture

speaking of dogma, the "energy crisis" is government-imposed.  First, the US has massive reserves of oil north, south, east, and west, and off most of its shores.  Second, it has ginormous natural gas reserves.  Third, it has even bigger coal reserves.  Finally, it has enormous uranium reserves too.

If energy production is being squeezed, it's not nature doing the squeezing.  It is government violating the rights of the mine and well owners.  All in the name of earth-mother Gaia.

Wed, 12/22/2010 - 20:54 | Link to Comment StarvingLion
StarvingLion's picture

It would have 300 million+ largely unemployable people in an asset based system who would do little except quickly exhaust those reserves.

Wed, 12/22/2010 - 21:08 | Link to Comment Calmyourself
Calmyourself's picture

How quickly would the reserves be used up?  You have obviously done the calculations, I was just wondering, if we started up pebble bed and breeder reactors like Japan when would we use this all up? Oh, and then all that coal, NG and oil. Thanks.

Wed, 12/22/2010 - 21:08 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Funny stuff.

Thu, 12/23/2010 - 01:49 | Link to Comment trav7777
trav7777's picture

love it, the precision and accuracy dripping off your post, "ginormous"...is that a technical term?

By the way, you're an idiot who doesn't grasp growth compounding

Wed, 12/22/2010 - 20:39 | Link to Comment StarvingLion
StarvingLion's picture

Modern Money Theory (MMT) is now THE SOLUTION that is popping up all over the net.  Even Denninger in the last day or so is endorsing it (while banning every 2nd poster on his site).  The basic idea is: "If we just get control of the printing press, everything will be fine".   These kooks then have the gall to say it will be strictly for infrastructure projects and everyone gets a job.  Its complete batshit insanity but it is revealing in what really matters now:  EVERY (WO)MAN FOR HIMSELF.  GET THE LOOT ANY WAY POSSIBLE AND HEAD FOR A SAFE HAVEN.  In other words,  Give me the printing press you thief so I can be a thief.

Wed, 12/22/2010 - 20:47 | Link to Comment Chappaquiddick
Chappaquiddick's picture

There is no solution to what we are doing apart from to stop, and either we do this by choice or because we must.  Debt is the key driver and that will precipitate the decent.  No doubt that there are still large reserves in the US but oil, gas and coal are all past peak and a collapsed (prolapsed) economy won't/can't utilise it.  End of Empire - you're watching it, now in 3D!!

Thu, 12/23/2010 - 02:05 | Link to Comment Things that go bump
Things that go bump's picture

I am so sad.  I graduated from high school the year we walked on the moon.  I thought by now we would be colonizing the moon and maybe going to Mars, that there would be a great future ahead of us.  I knew I wouldn't have the stars, but I thought maybe my grandchildren or my great grandchildren would.  Now its ashes and dust.  We are going to die as a species on on this rock and probably in the not too distant future.    

Thu, 12/23/2010 - 09:39 | Link to Comment fiftybagger
fiftybagger's picture

Ermm, hate to burst your already busted bubble pal, but we never went to the moon...

http://www.youtube.com/watch?v=gXRSc1xB0dU

Thu, 12/23/2010 - 01:55 | Link to Comment aerojet
aerojet's picture

Also bullshit.  There is a societal demographic shift taking place--the Boomers are going to die off, and probably much faster than anyone is willing to believe.  There will also be a wealth transfer taking place as well.  Ultimate peak?  Like hell.  It's mostly about one generation that collectively believes that the world simply  cannot go on without them.  The world doesn't give a shit, however.  Here today, gone tomorrow.

Thu, 12/23/2010 - 03:54 | Link to Comment UninterestedObserver
UninterestedObserver's picture

Amen - that's why I don't skimp on the good wine or choice steaks, enjoy it while you can! My mom grew up in post war Berlin - getting to eat meat once a month was the norm

Wed, 12/22/2010 - 20:26 | Link to Comment Bearster
Bearster's picture

I wonder if the coward who junked molecool is the same guy who junked some of my posts yesterday (on the incessant march towards fascism).

While I would not say that leaving is the right move for everyone, I certainly wouldn't say it's wrong.  And it very certainly isn't wrong to talk about it!  Sheesh!

 

Thu, 12/23/2010 - 06:57 | Link to Comment AnAnonymous
AnAnonymous's picture

how much more blood can they squeeze from a dry rock?

 

The US middle class is a vehicle and get a fee for being used as such.

 

See what is happening in the gold sector.

 Back in 2008, I underlined the very fact that adding pressure on gold extraction would lead to kill people. Gold bugs denied that and are still in denial, seeing in reports of the fact a manipulation by the elite.

As soon as there is a release, people are going out of gold. Others will buy from them.

But the others will have clean hands. They knew before hand that it would lead to blood. They wanted to keep their hands clean. They found people to buy gold for them and those people are the ones with the dirty hands.

Mere vehicles. The US middle class get paid though for being used as vehicles.

Thu, 12/23/2010 - 12:14 | Link to Comment Boxed Merlot
Boxed Merlot's picture

...adding pressure on gold extraction would lead to kill people...US middle class get paid though for being used as vehicles...

Not entirely sure of the connection you're trying to make here but for what it's worth, gold extraction is my own personal means of determining when the tipping point for hope I can believe in commences.

Until CA allows, and dare I say, encourages our mining industry to go back to work, the scales will continue to be weighted on consumption vs production, sanctimoniously inept vs helpful and entertaining vs educational.

We have the technology, infrastructure and reserves to not only extract our AU, but to lead in this "barbarous industry" once more in a safe, secure and productive manner but have yet to turn the corner from our bloated, holier than thou amusements. imho.

Governments grow larger than the taxpayer can afford, markets remain delusional longer than an investor can remain solvent and AU deposits remain buried until a will returns.

Wed, 12/22/2010 - 18:51 | Link to Comment Dixie Normous
Dixie Normous's picture

I wrote a nice letter last year to my town manager warning her of the pending disaster if they didn't tighten their belts and prepare for a huge increase in the mil rate to counter the huge decline in property values during the next reval.

She told me to have a nice day.

I told her see you next tuesday.

 

Wed, 12/22/2010 - 18:53 | Link to Comment the rookie cynic
the rookie cynic's picture

Silly Charles, doesn't he know that the banks and government are broke. Where else are they going to turn for cash?  The Bernank can't print everyone out of insolvency, now can he? No, the taxpayers are stupid, disorganized, and would rather watch Ms. Palin dance and argue about whether Tom Brady should get a haircut. Much easier pickins.

Wed, 12/22/2010 - 18:58 | Link to Comment SilverIsKing
SilverIsKing's picture

Why would a 30% drop in home values have any impact on property taxes?  The cost to pick up the trash or run a police department doesn't decline as property values decline.

Wed, 12/22/2010 - 19:10 | Link to Comment spongeBOB
spongeBOB's picture

Why doesn't the cost to run the police department or the schools decline or at least stay the same? Taxing homeowners is the easiest thing to do when there is budget shortfall because they are stuck and cannot do a damn thing about it. I looked at my property tax bill and I am paying the salary for everybody's and his brother and for thier pension fund on top of it. Why can't people with kids pay for their education by charging tuition at public schools?

Wed, 12/22/2010 - 19:24 | Link to Comment SilverIsKing
SilverIsKing's picture

I don't disagree that those who run the government need to be much more fiscally responsible with other peoples' money.  As a taxpayer who has been subjected to a doubling of his property and school taxes over the past 10 years, I would like nothing more than a reduction in my tax bill.  My point is that the costs of running public services isn't variable and doesn't automatically correlate to property values.  In order to reduce taxes whereby they remain in line with property values as they decline, our politicians have to make some tough decisions and we all know how well that goes.

Wed, 12/22/2010 - 21:04 | Link to Comment crazyjsmith
crazyjsmith's picture

Well, then the system needs an overhaul because it isn't setup to deal with logic. 

Thu, 12/23/2010 - 01:58 | Link to Comment aerojet
aerojet's picture

I disagree.  Those fuckers did everything in their power to aid and abet the real estate bubble and reaped huge benefits right along with the rest of the financial services industry.  Now that the time has come for it to all get cut back again, they don't want to deal with it and will fight to keep what they see as theirs.  It isn't going to work, though.  The cuts will come, they have to.

Wed, 12/22/2010 - 21:41 | Link to Comment bronzie
bronzie's picture

"Taxing homeowners is the easiest thing to do when there is budget shortfall because they are stuck and cannot do a damn thing about it."

owning property in an economic downturn is like wearing a sign that says, "come tax me, please"

the government isn't going to close up shop and go home - rest assured that your financial well-being is expendable when the choice comes down to taxing visible assets vs down-sizing govt

we can be thankful that (at least so far) we are only being taxed - throughout history the governing authorities have used more ruthless means of separating property owners from thier assets (accuse them of criminal activity and sieze their assets, accuse them of witchcraft, kill them and sieze their property, etc)

Wed, 12/22/2010 - 19:18 | Link to Comment Iam Rich
Iam Rich's picture

Why would a 30% RISE in home values have any impact on property taxes?  The cost to pick up the trash or run a police department doesn't INCREASE as property values INCREASE.

Wed, 12/22/2010 - 19:46 | Link to Comment SilverIsKing
SilverIsKing's picture

The RISE in home prices has no direct impact on property tax levels but rather, the wealth effect stemming from RISING home prices takes the pressure off politicians and allows them free reign to spend recklessly taking the path of least resistance when making fiscal decisions, i.e. negotiating with unions, etc.

Thu, 12/23/2010 - 03:56 | Link to Comment UninterestedObserver
UninterestedObserver's picture

Seriously - stop being a moron.

Wed, 12/22/2010 - 19:57 | Link to Comment Id fight Gandhi
Id fight Gandhi's picture

It rises because housing is a growth instrument and more housing is built and fueled demand. People trade up. Just like the bubble we had.

Munis get drunk with all the new prop taxes and piss it away expecting it to always be there. Then they borrow against future money they expect that will never be.

Wed, 12/22/2010 - 22:44 | Link to Comment mophead
mophead's picture

+30%

Thu, 12/23/2010 - 02:37 | Link to Comment marc_hanes
marc_hanes's picture

Few want to rob a poor man's house, more a rich man's house. Reality or perception, it may wash out the same.

Wed, 12/22/2010 - 20:42 | Link to Comment QQQBall
QQQBall's picture

lower assessed value = lower tax payments assuming no change in the tax rate.

Wed, 12/22/2010 - 21:01 | Link to Comment crazyjsmith
crazyjsmith's picture

Silverguy,

Hate to be painfully obvious, but property taxes are based on assessed values. 

Lowered Assessed values = lower property tax

Sorry to burst your bubble slick. 

Thu, 12/23/2010 - 00:07 | Link to Comment SilverIsKing
SilverIsKing's picture

Slicker.  Can I call you that?  I have a question for you.  If homes values in a particular area fall by 30%, based on your slicker logic, property tax collections should drop by 30% too.  Correct?  Keep following...

Now with revenue down by 30%, what has to happen for the municipality to balance it's budget?

Hint: assessment rate

Thank you very much Slicker.

Your friend,

Slick

Wed, 12/22/2010 - 21:17 | Link to Comment robobbob
robobbob's picture

Why would a 30% INCREASE in home values have any impact on property taxes?  The cost to pick up the trash or run a police department doesn't INCREASE as property values INCREASE.

So why did the rest of us have to pay more just because the new guy moving in down the street paid more then we did?

Wed, 12/22/2010 - 18:59 | Link to Comment M.B. Drapier
M.B. Drapier's picture

Didn't Chris Whalen (where I can't remember) relate this to foreclosure moratoria and so on? State governments have an incentive to protect mortgage delinquents who keep paying their property taxes, and apparently that's what many of them did during the Great Depression.

Wed, 12/22/2010 - 18:59 | Link to Comment bob_dabolina
bob_dabolina's picture

On the flip side of the coin I know a guy who bought a home here in San Diego for $50,000 about 35-40 years ago. His home is now worth $450,000 and he pays the same property tax as if his home was still worth $50,000.

So the whole thing is broken.

Wed, 12/22/2010 - 19:21 | Link to Comment mynhair
mynhair's picture

Yep, spank him for being stable; that makes sense.

Wed, 12/22/2010 - 19:22 | Link to Comment mark mchugh
mark mchugh's picture

In my area (PA), taxes also seemed to lag the bubble considerably.  People would brag that their house doubled in value, then bitch when their taxes went up 10%.  It was like they threw the value to tax ratios out the window, which stoked the bubble that much more.

As trailer trash moved into McMansions, another wierd thing happened.  They decided they needed better schools.  I can't think of a school district in my area that hasn't done a major overhaul of some kind in the last five years, and yes they did all this with borrowed money.  Now no one wants to pay it back (surprise, surprise).

No easy answers here, just observations.

 

Wed, 12/22/2010 - 19:26 | Link to Comment -Michelle-
-Michelle-'s picture

The home value was imaginary money; taxes are paid with the real stuff.

Thu, 12/23/2010 - 11:09 | Link to Comment LauraB
LauraB's picture

The people complaining about the rise in taxes were right to complain.  The increased "value" was only on paper.  Even though people felt richer because their houses were assessed higher as greater fools continued to pay higher and higher prices, no one actually had any more money.  You do not realize the higher value unless and until you actually sell at the higher price.  Thus, everyone who paid higher taxes based on a higher assessed value was robbed as they did not actually have any more money with which to pay those taxes.  People were duped into thinking that they were wealthier, but it was all phantom equity based on fraudulent loans.

The same thing goes for people who took out HELOCs.  They were bombarded with commercials from the banks encouraging them to "extract equity" from their homes like they were taking money out of their savings accounts to buy all of those fancy toys and live the high life.  Guess what? The money wasn't theirs.  They took out loans.  They borrowed against their homes.  Unless and until they actually sold their houses for the higher value, they did not have any more actual money.  They were not really any wealthier.

Thu, 12/23/2010 - 12:53 | Link to Comment RKDS
RKDS's picture

And yet we had to fight and fight just to get a 5% cap on property tax increases in 2006 (Act 1).  Yeah, sure, we did that because taxes only went up 10% between 1999 and 2006.

Damn am I getting sick and tired of paying 4.99% tax hikes every year out of a salary that's been frozen for the last three...

Wed, 12/22/2010 - 20:26 | Link to Comment Drag Racer
Drag Racer's picture

glad to hear your taxed stayed low, but much a different story here. up exactly 33.33% over last year... Arizona.

Wed, 12/22/2010 - 22:04 | Link to Comment amusedobserver
amusedobserver's picture

I, too, live in San Diego and have lived in my house for 25 years now.  I paid $135,000 for it, my last tax bill was $2,200 so assessed value is $220,000 and current market value is probably about $450,000.  But there are a few points I would like to make that nobody ever seems to consider.

First, under the law every property is unique (even two neighboring plots of land in the middle of a desert).  The last time this particular property was valued by an exchange of money, it was $135,000.  So that's its value, period.

Second, the dollars I paid in 1985 were worth a lot more than current dollars.  If the current valuation of $450,000 is deflated at 5% annually for 25 years, I get about $125,000, so the real value of my home hasn't changed at all and has perhaps decreased a bit.  So why should I pay more in taxes?

Third, no one remembers the reason for Prop 13 in the first place.  In the "old" days, properties would be re-assessed every four years, so you would at least know that your tax would be constant for four years at a time.  Then thanks to computers they were able to computerize the tax rolls and re-assess everyone's property every year, this in the rising real estate market of the 1970's.  So people who had lived in their homes for two or three decades (and bought those homes for under $10,000) were being taxed at amounts that approached the purchase price of house.  Many of these people were retired or on fixed incomes and were being forced to sell their homes to pay the tax bill.  This is why Prop 13 was voted into law.

I say make the state and municipal authorities stay within their revenues or throw them into jail.  No borrowing to cover "shortfalls".  If they are not willing to make the tough decisions, then get rid of them and find people who will.

Wed, 12/22/2010 - 22:51 | Link to Comment mophead
mophead's picture

"this in the rising real estate market of the 1970's."

You mean the deflating dollar of the 70's.

Thu, 12/23/2010 - 01:45 | Link to Comment piceridu
piceridu's picture

+135,000

Thu, 12/23/2010 - 02:04 | Link to Comment aerojet
aerojet's picture

I wholeheartedly agree, but I also know that government is run for the benefit of the people involved in it and many of those people are connected with the real estate business.  Government is a monster, it just grows and escalates to ridiculous proportions, the worst aspects of human nature are allowed to flourish within the bureaucracy.  It takes peole of principle to keep the machine from expanding, and there aren't enough of those people in the right places to do it.

Thu, 12/23/2010 - 11:22 | Link to Comment LauraB
LauraB's picture

Exactly!  Any rise in value was only on paper.  The homeowner did not have any more income with which to pay the rising property taxes.  No actual income is realized by the homeowner unless and until the house is sold for the higher value.  This is just government theft.

Wed, 12/22/2010 - 23:37 | Link to Comment tmosley
tmosley's picture

Did the cost of privately provided services going to his home increase nine-fold during that time?  Then why should taxes?

Thu, 12/23/2010 - 01:41 | Link to Comment piceridu
piceridu's picture

Do you how f'kd everyone in California would be without Howard Jarvis's Prop 13? There is a yearly battle to remove it so the legislature can stick property owners without their say. Without Prop 13 thousands on people wouldn't be able to afford to live in their own homes. Property tax is pure thievery. 

Wed, 12/22/2010 - 19:03 | Link to Comment knukles
knukles's picture

Negative Convexity.

Wed, 12/22/2010 - 19:06 | Link to Comment Trimmed Hedge
Trimmed Hedge's picture

30% off, you say??

BUY THE EFFIN' DIP!!!

Wed, 12/22/2010 - 19:12 | Link to Comment Critical Path
Critical Path's picture

Don't own any real estate at the moment (none) and have no plans of doing so for some time.  Why anyone in their right mind would consider buying now is beyond me, unless you can pick up something at a major price reduction and are going to use it as your primary residence.  Does it come with some quality land?

 

Who says: "Let me pay the market price for some property that has god knows what fraudulent documents associated with it, furthermore, let the thing take another nose dive in value so any equity I had initially can be wiped out all the while being squeezed like the peasant my municipality thinks I am for additional tax money they can fork over to some interest that I can almost 100% guarantee will not benefit myself or family or my now underwater, dog of a property."  FORGET IT.

 

 

RESET

Wed, 12/22/2010 - 20:52 | Link to Comment QQQBall
QQQBall's picture

Market value is relative, but some people have an ability to clue into some sort of "intrinsic value"... What I'm trying to say is that there is a value that will get me off the sidelines, but I have not seen it yet.  The odd thing that I see is that in some market the 1-4 market is getting crushed so bad that the prices are very competitive with the 5+ unit apt projects.  This is very odd as the higher leverage on the smaller units almost always guaranteed higher multiples and higher $/Unit prices. The larger stuff has quite a ways to come back in my opinion, but I am a small fry.  

Thu, 12/23/2010 - 03:59 | Link to Comment UninterestedObserver
UninterestedObserver's picture

Buy farmland or a castle...

Wed, 12/22/2010 - 19:13 | Link to Comment mynhair
mynhair's picture

Millage, bitchez!

Fri, 01/14/2011 - 19:00 | Link to Comment Clapham Junction
Clapham Junction's picture

(d)

Wed, 12/22/2010 - 19:14 | Link to Comment Seasmoke
Seasmoke's picture

and yet the public employees still want more , plus they want to be paid on the empty promises of the worthless IOUs of the pension ponzi scam

houses to could fall to $1 and yet property taxes will still go up .....owning a house is now a major liability

Wed, 12/22/2010 - 19:18 | Link to Comment docj
docj's picture

Have you ever sat across the "bargaining table" with the local teachers' union?  Yeah, you pretty much have it nailed.  The budget director for my town last year tossed the business section of the Boston Globe at the state union rep during budget negotiations - saying something like "Have you seen what's going on out there?"

The response?  "We don't give a f*** what's going on 'out there' - we want our f***ing money and we're going to get our f***ing money."

Thu, 12/23/2010 - 09:58 | Link to Comment fiftybagger
fiftybagger's picture

I can't wait until they go bust and they get zero

Wed, 12/22/2010 - 19:15 | Link to Comment docj
docj's picture

This is right up there with the southern city (think it was Hot-lanta) that went on a huge "conserve water" campaign because they were, well, out of water.  The net result was that the citizens did their best to conserve water and actually cut back something like 15% over the year before.

Their reward?  Their water rates went up about 17%

The moral to the story?  The Beast will get her pound of flesh.  One way or another.  The Best must be paid.

Thu, 12/23/2010 - 01:49 | Link to Comment HungrySeagull
HungrySeagull's picture

Homestead act anyone?

We bought our place dirt cheap and that is where we are staying. Unless we can find land away from any town or village.

Wed, 12/22/2010 - 19:20 | Link to Comment Iam Rich
Iam Rich's picture

It's just bass ackwards, that's all.  You want people to conserve water...then raise the price.

Wed, 12/22/2010 - 19:23 | Link to Comment mynhair
mynhair's picture

Water 'conservation' scam has being going on in Seattle for 20 years.  In fact, they still have an 'emergency' summer surcharge on the books from 1991.

Wed, 12/22/2010 - 23:36 | Link to Comment amusedobserver
amusedobserver's picture

Exact same thing happened in San Diego.  Twice, in the last 20 years.

People are stupid.

Thu, 12/23/2010 - 04:32 | Link to Comment Confused
Confused's picture

If I'm not mistaken, it has happened in NYC as well. Very recently too. 

Thu, 12/23/2010 - 13:05 | Link to Comment RKDS
RKDS's picture

This is why I laugh at every conservation pamphlet PP&L sends with the bill.  It doesn't matter how much I conserve, the newly-deregulated electric company just raises their rates to compensate.

And I really seriously tried.  I only heat three rooms of the house, keep my water heater on a timer, turn lights off when I leave a room, keep the TV off (no cable), etc and my bill just goes up and up and up.  I am dreading the day when electric cars are mandated and I get to pay for increased strain on the grid even though I drive an old 199X Pontiac.

Wed, 12/22/2010 - 19:18 | Link to Comment irishlink
irishlink's picture

We are all in the same boat! Moved to Ireland in the 90's. No refuse charges ,virtually no parking meters, no school bus fees,no water metering etc, etc. NOW meters for parking everywhere, city resident parking fees. proposed property tax , proposed water meetering ,refuse charges, school bus fees, higher college fees,national 2 year car test fees, higher road tax, toll road fees,etc . every government, everywhere have increased their entitlements even as demographics were working against them. They conned the people with so called lower income taxes while stealing us blind with stealth taxes. Wake up everyone! Wait and see who is going to pay for the bank bailouts with less credit ,higher rates ,and fees on anything that twitches.; THE NEW NORMAL!

Wed, 12/22/2010 - 21:14 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Hopefully we revert past the mean.

Wed, 12/22/2010 - 19:22 | Link to Comment -Michelle-
-Michelle-'s picture

Eventually we will have to revert to pay-for-use services.  There's no other way.

Wed, 12/22/2010 - 20:02 | Link to Comment MachoMan
MachoMan's picture

So I should pay the government for a service a private actor could do better?

Wed, 12/22/2010 - 20:16 | Link to Comment -Michelle-
-Michelle-'s picture

Absolutely not.  I meant that the government will have to stop providing these services.  People will have to go back to paying private actors for the services they choose to purchase.

I'm over expecting the government to do things for me.  Most house fires start small and could easily be put out with an extinguisher that most people don't have because it doesn't occur to them.  We've got five in our house.  Two in the kitchen, one in the garage, one in the laundry room, one in my closet.  Police?  When seconds count, the police are minutes away.  We're well armed and keep our property secure.

Ambulance services?  Why should 911 be the first call?  The actual ambulances around here are privately run.  Why can't I call them directly?  Why are fire departments staffed with paramedics?  Seems like an unnecessary layer.

We're homeschooling.  I'm paying school taxes and I'm doing everything I can to make sure my children never cross the threshhold of a public school.  Library?  Ours is systematically getting rid of the books I'd want to borrow.  I'll just purchase them and keep them, thank you.

Garbage collection?  When we first moved here, there was no garbage pickup.  We took our trash to a dropoff center as needed.  After a year or so, pickup was mandated and fees took effect.  I'll gladly go back to hauling it in ourselves.

Sigh.  So many things that local governments have needlessly taken over.  I need to move to Idaho.

Wed, 12/22/2010 - 20:29 | Link to Comment Don Birnam
Don Birnam's picture

+1

Wed, 12/22/2010 - 21:12 | Link to Comment CrockettAlmanac.com
CrockettAlmanac.com's picture

Most house fires start small and could easily be put out with an extinguisher that most people don't have because it doesn't occur to them.

 

Hot tip:

http://www.google.com/#q=indian+pump&hl=en&prmd=ivnsu&source=univ&tbs=sh...

Thu, 12/23/2010 - 08:37 | Link to Comment -Michelle-
-Michelle-'s picture

Where were you when I was making my Christmas list?

Wed, 12/22/2010 - 19:23 | Link to Comment SwingForce
SwingForce's picture

Skype's out, you think its payback for helping Assange?

Wed, 12/22/2010 - 19:24 | Link to Comment mynhair
mynhair's picture

Programming problem.  Been out most of the day.  Not JA related.

Wed, 12/22/2010 - 22:12 | Link to Comment Dr. Sandi
Dr. Sandi's picture

New Year's Resolution for Julian Assange:

Always double bag your groceries!

Thu, 12/23/2010 - 03:22 | Link to Comment aka_ces
aka_ces's picture

and choose the plastic, not the paper.

Wed, 12/22/2010 - 19:28 | Link to Comment gwar5
gwar5's picture

Like I never saw this coming from a mile away.  Munis will raise the rates or local sales taxes if values are no good.

Either way they have more to feed the bear. What they really need to do is cut to the bone and get the pus out. 

We're all Irish now. Make the costs go away or it will continue to ride our backs.

 

Wed, 12/22/2010 - 19:45 | Link to Comment Threeggg
Threeggg's picture

You see people posting on the net all the time about "should I pay my house off" ?

I say hell no...............why?

Because this is the only tool you have against the county to keep your taxes under control.

If you pay your house in full you are trapped.

Many senior citizens are on fixed incomes but they own their house outright and they will be fu%ked because they will have no choice but to pay any increase. !

The pile of rolling shit is rounding the bend.

Wed, 12/22/2010 - 19:59 | Link to Comment -Michelle-
-Michelle-'s picture

How is a mortgage a tool against tax increases?

Wed, 12/22/2010 - 20:06 | Link to Comment Id fight Gandhi
Id fight Gandhi's picture

Pay nothing off. Low interest loans and roll em over. Have gold and silver on hand.

If you go bankrupt, sucks to be them.

Wed, 12/22/2010 - 20:40 | Link to Comment Threeggg
Threeggg's picture

+10

Wed, 12/22/2010 - 21:03 | Link to Comment QQQBall
QQQBall's picture

Ah thanks for the advice;  I like owning my home and land and as of today, I can still keep growing food on it.  As Michelle point out, however, if i dig a well or go to septic, the City still requires me to pay for the sewer service, which sucks.  I think i also have to pay for the water basic service charge, b/c I am hooked up, even if I switched to a well...  I'd like to have a well, septic service, solar power and an electric car powered off of my panels and batteries. They have been talking about recycling sewer water here for years... I cannot go for that.  

 

The real problem for most people is the herd instinct. If people bought when stuff was cheap and no one wanted it and lived below their means instead of refi'ing money out of their primary residence, they would be okey. People who bought years ago, paid their house off and live w/in their means still have enough for popcorn to watch the rest of the idjit sheeple plan how to fuck the banksters. Ha! 

 

 

Wed, 12/22/2010 - 19:53 | Link to Comment tony bonn
tony bonn's picture

property taxes are rising to fund the insatiable greed of the 4th reich....how else to fund the nazi cameras at every street corner and the massive hordes of police thugs swarming all over american cities...

Wed, 12/22/2010 - 19:55 | Link to Comment Catullus
Catullus's picture

Middle class prisons.

Thu, 12/23/2010 - 02:03 | Link to Comment Boxed Merlot
Boxed Merlot's picture

Middle class prisons...

Google Earth: "Cielo Lindo Commons, Milpitas, CA"

This KB (Kaufman Broad) multi-family dwelling mushroom community was constructed at the last hurrah in 2007-8 and sits one block north of the local detention facility. The only difference between paying 600K-1M (plus taxes) for your personal slice of heaven and sitting in a cell block less than 200' away is you have to pay for your utilities and prepare your own food.

Oh yeah, and instead of a 16' cyclone fence to see through, you get a 12' block wall perimeter to keep all the beauty in.

Wed, 12/22/2010 - 20:00 | Link to Comment Bruce Krasting
Bruce Krasting's picture

Author says:

Homeowners in many locales can petition the property assessor's office to lower the assessed value of their homes; if granted, such reductions in value can substantially lower property taxes.

I know a homewoner that had an appraised value of 2.2m. The house got sold for 1.2m. (two months later it cratered on a mortgage contingency). She got lawyer who said it was a slam dunk given the sale contract. The County said no. Take a hike.

This will not go away. It will go to court. Property owners are actually minorities in most communities. Homeowners are going to lose. But then RE goes with it. Where is that cyanide?

Wed, 12/22/2010 - 21:06 | Link to Comment QQQBall
QQQBall's picture

Bruce, I believe aprpaisers can take tax appeals cases on contingency/percentage fees. That could lower her costs if she loses, but I doubt she will... they might not roll to $1.2MM, but they will roll - that has been my experience. A failed escrow might not be enough for teh Assessor's office, but if its MV then she can win.

Wed, 12/22/2010 - 20:01 | Link to Comment beastie
beastie's picture

I have an app for this.

This is easy fellas. Set up your house as a place of worship. Set aside a room with various effigies, whips, candles and a human skull or two and you are good to go. Unfortunately, you have to go with a mainstream religion so for all you Jedi Knights you guys are shit out of luck. I went the Voodoo S&M with an emphasis on goat dancing and mutilation.

Check your local laws before going to all this trouble of course.

 

Wed, 12/22/2010 - 20:43 | Link to Comment Rogerwilco
Rogerwilco's picture

@beastie

In the years leading up to the French revolution, the PTB found themselves short of cash. To raise money, they sold bonds backed by the value of land owned by the church. Their reasoning was along the lines of "the land was never taxed, so now you have to help us out by loaning the equity to back these bonds.

It didn't work out too well, and heads rolled.

Wed, 12/22/2010 - 22:36 | Link to Comment beastie
beastie's picture

I wonder do people object to me making fun of religion in general or doing my best to pay as little tax as possible?

Either way it matters not a damn to me but it is amusing.

 

I'll tell you guys a little story though. I live in a one traffic light town of 2500 whose tax base is based mostly on property tax. We have an 800K budget for cops, 350K in pensions this year and the balance of the 1.8 mill budget goes of misc bullshit. We are underwater this year of course. We have been underwater for a few years. We will be in even worse shape when the existing bunch of fat cops, pot hole fillers, dog catchers etc start to retire. The only crime we have is all the drunks leaving the local VA private club. The cops are drinking up there with the same drunks BTW. Oh yeah, rough guesstimate of 10-15 % of the homes are in preforeclosure or foreclosure. 

We pump for water, we don't have garbage collection as I have to haul my own trash to the town dump and pay for that privilege as well, we pay another town for their fire dept individually as "insurance", I pay for my kid to go to school out of my pocket. So in reality the only service the town provides is roads. I pay about 800 - 1200 per year in car taxes. I pay state taxes, I pay Federal Taxes. I am required to have medical insurance whether I like it or not. On and on the list goes.

So what exactly am I getting for 6500 bucks a year in property taxes? A bunch of drunken fat cops? I don't think so. Starve this fucking beast is my attitude.

The numbskulls in this town are trying to block a food distribution co. from opening a warehouse here. Hardly heavy industry. If these numbskulls are content to be beld dry through escalating property taxes becasue they like horses and trucks take something from their quality of life well good for them. I'm all for them doing it on their dime.

Thank you and good night.

Wed, 12/22/2010 - 21:05 | Link to Comment dehdhed
dehdhed's picture

the author posts a link to new jersey property taxes rising by 12% in some municipalities  ... um, just one. on average 4%, or $375/year ($30.50/month).    the tax increase is going into effect before next year's statewide 2% annual property tax cap takes place.

then, under the caption 'nationally, property taxes now dominate local tax revenues',  he presents a graph of homes values from 1999-2005 which seems to substitute for a tax graph which wouldn't look nearly as dramatic (according to the bls link)

i mean really, just go back to the home page for the summation of this article and see the small graph which is included, and is hard to discern what it is .. then read the title 'house values fall 30%, but property taxes keep rising' .. the graph used is home values between 1999-2005 but it's meant to give the impression of skyrocketing taxes.  it's definitely not a graph of home prices falling 30% anyway and it's definitely not a graph of property taxes.   so what gives?

lastly, in the link for bureau of labor statistics,  for the first two quarters of 2010, the amounts for property taxes equal the first two quarters of 2009. 

i'm not for higher taxes, no way no how, but this article seems to border on sensationalism imho


Wed, 12/22/2010 - 20:09 | Link to Comment Dyler Turden II Esq
Dyler Turden II Esq's picture

"If you pay your house in full you are trapped."

Care to explain?

How are you less trapped if you still owe?

Maybe you are less trapped if you have almost zero equity; i.e. if you can just walk away with almost no loss. But otherwise...

 

Wed, 12/22/2010 - 20:33 | Link to Comment Seasmoke
Seasmoke's picture

you let the local government control all the equity and you are NOT liquid enough to do anything about it.....if you owe a mortgage and hold onto the cash , even under your mattress, u can always tell them to go fuck themselves if need be.....plus it will take atleast a year before they can even begin to try and get you out of your underwater house

just look at foreclosuregate of the past 2 years......those who had nothing down , were much more willing and able to walk away ......and far as im concerned lost very little

Wed, 12/22/2010 - 20:15 | Link to Comment no cnbc cretin
no cnbc cretin's picture

Property taxes, I have an issue with when they go up, even though my property is worth less. That's wrong. I also have an issue with towns that spend too much, and expect the landlord/homeowner to pay for their overly fancy infrustructure. Property taxes should be based on what the property is worth, period.

Then again we are now living in a FUBAR world.

Wed, 12/22/2010 - 20:16 | Link to Comment slvrizgold
slvrizgold's picture

"We will destroy the Proletariat with taxation and inflation."  - Some Communist bastard

Wed, 12/22/2010 - 20:53 | Link to Comment honestann
honestann's picture

And indeed, they have.

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