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

Tyler Durden's picture

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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.

-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?

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.

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. 

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.

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.

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.

Motorhead's picture

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

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.

Vagabond's picture

Does the junker have a counter-example?

Aristarchan's picture

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

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.

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.

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 !  

knukles's picture

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

Monetary Lapse of Reason's picture

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

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.      

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.

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.

Thomas's picture


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.

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.

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!

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.

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.

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.

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.

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

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. 

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.

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....

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.

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.   

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.

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. 


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.

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?

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!

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.  

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.


Thisson's picture

Well, the property tax revolts are starting:

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

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

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. 

Money Squid's picture

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

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.

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.

UninterestedObserver's picture

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

-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.