Our 2 year old home was already reasessed at 25,000 lower than what we paid.

If the assessments go down, the tax rate will go up to compensate. At least that is what we have seen in our area.

We actually saw on the news one county in MD who had a law on the maximum annual increase in real estate tax set to 5%. The board of supervisors in that county just voted to change the law to adjust the maximum increase to 10% just to make the budget close.

A Storm is coming. But don't worry, the stimulus bill will save us.

sniffdog,

thanks for the chuckle, i think.

sniffdog is right...
if they need XXX dollars to balance the budget, they will just rate the rate as they lower assessments.

You'll end up paying the same as you do now.

sniff, you gave me the laugh of the day! Hee, hee. Save us. Hee, heeheehee!!

Correct - if you assessed at $500,000 last year, with say a 2% tax rate...and they assessed you at $450,000 now, I can guarantee it wont be long before that tax rate goes to 3%...

You (me) will never win that fight...

The old Chinese curse 'May You Live In Interesting Times' sure seems like it's been placed on us. At least in my area (cent FL) the precipitous drop in all tax revenues is putting the local and state governments into panic mode. Raising tax rates may be very difficult to accomplish this time around. The wholesale cutting back on public payrolls and the resulting scaling back of govt. services will make everyone loathe to pay more if you are going to get less. Over the last 10 years, the 'bubble' produced such an excess of money..especially through the impact fees we've seen an explosion of nice but unnecessary amenities. Thin brick pavers on the downtown streets, massive amount of decorative landscape plantings that require a whole new crew to water every night, generous subsidies to downtown associations to offer fix-up/paint up grants. Guess what, that money's gone and not coming back for a long time. I think some plants are going to be drying out and dying....

Guess it's time for you non-Californians to re-learn the lesson we tried to teach you back in the 70's with Proposition 13. That ballot initiative froze our property tax rate at 1% and any levies above that required a 2/3 majority vote by city, county or state legislative bodies (an almost insurmountable hurdle). And the assessed value of properties couldn't rise faster than 2%/year. In addition, if property values went down, your property had to be reassessed to reflect the decline and you could appeal the decision if you didn't like it.

Here in CA with our plummeting home values, there's a burgeoning business of scam artists offering to do for a fee what counties will allow you to do for free, i.e., appeal the reassessment. I just got a very official letter that I almost mistook as coming from the county asking me to send in $179 and they'd take $6K off my property tax.

Here in Florida we have the onerous 'Save our Homes' initiative. It caps assessment increases to 3% a year on homestead properties. Over the years this has created a disparity in property taxes since when the property sold, taxes would be 'updated' to the selling price. People who just moved into a neighborhood might find they are paying 300% more tax than their next door neighbor who has been in his home for 15 years or more. The crash in property values might actually serve some good by erasing this unfair effect of the tax law. Taxes do need to be paid to fund public service but must be levied fairly across the board. Staying put or moving should not be a reward/penalty occasion...it should be a non-issue.

Hi Montalvo. The one thing wrong about us here in ca. with the property tax break is that the state has more than made it up in other areas. They will get it one way or the other!

Gary, your comment on the disparity in taxes is true for Prop 13 as well and is frequently raised as a deficiency in the program. But there's no free lunch and you can't have it both ways. Do you want people on fixed incomes to be taxed out of their homes whenever a real estate bubble causes home values to soar? Those who buy a new home know precisely what their tax burden will be when they purchase, and what it will be going forward. That's a tremendous benefit for those wanting financial stability in their lives. The same cannot be said for allowing property taxes to swing in the winds of changing property values. Prop 13 continues to be wildly popular with Californians.

Sierra, you're right in pointing out that the state government has aggressively pursued finding other sources of taxes. But imagine if property taxes had not been curtailed by Prop 13 during the recent bubble. The state would have enacted even more new programs that they'd then be unwilling to shut down when property tax revenues declined and we'd have been in an even bigger mess (hard to imagine...but true). What the state needs is an ability to constrain the pace of spending to something close to the growth in (legal) population...but regrettably it ain't gonna happen.

Good points, Montalvo. The way it's working on our build concerning property tax, because of our slow going build, they base the years tax on the progress of the build according to the counties inspections. I think that is fair considering they could have based it on what the projected appraisal of the home would be and taxed full value, but they dont operate that way. We could have the attitude that it should be based only after the house is complete, but every step on a build is considered an improvement, so no negative feelings about it. We are very thankful for prop 13 and by the time we get completed, the market will still be down so our appraisal will come in low meaning lower final property tax.

Hello,

That`s really shocking, i think it is more wise to invest in commercial property,than in household properties.

Regards,
sarah_9

Here is a link that might be useful: Commercial Property