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by hiram112
1423 days ago
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I get tired of those claiming property taxes are unjust with the claim that one never truly "owns" their own home, but instead just rents it perpetually from the state. Property taxes are a significant share of local and state tax revenue and pay for schools, roads, police, courts, etc. Similarly, I'm not too sympathetic to those (often elderly) who claim they can no longer pay taxes due to fixed incomes while home prices increase. The amount their taxes have increased are a fraction of the equity they've gained - they should be able to obtain some sort of "reverse mortgage" that pays the taxes in exchange for partial ownership of the home, which would then be settled at time of death by the heirs who'd just not inherit the home 100% clear. What does bother me about ever increasing property taxes is the entitlement of the localities and states on that increased revenue without justification for the improved services they'll provide to taxpayers in exchange. In a city like Austin where home prices have increased close to 50% in just the last two years, that must mean the city and county's gross tax revenue has also increased by some proportion of that. I think most states and localities should be forced to run like a typical well run HOA where all costs and planned expenditures are 100% transparent. Taxes should only rise on properties when there is a justified cost increase, and should not automatically go up when values do. |
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Each time a house sells, property value jumps to the newly appraised value the following year. Sale prices are not public record in Texas, but oddly enough the amount borrowed can be found. So it's possible to impute sale price if you're willing to assume a given percentage down. Once you get the "homestead" exemption, appraised value may not go up more than 10% a year. And it does. Like clockwork. There are exemptions for over 65, disabled, etc, but they are flat dollar amounts instead of percentages or freezing annual tax increases.
In short your assumption that gentrification drives valuation increases isn't wrong - any property sale regardless of the reason (in a rising market) does exactly that - but as a property owner in Texas I can personally state that every year I didn't protest my valuation always went up the maximum allowed by law, not matter what was happening. Including during the 2008 crash! And thanks to the rule of 7, this means that every 7.2 years taxes double.
Realistically has the cost of supplying services from the state, county and city doubled over seven years? No, arguably not. We're only now seeing inflation that somewhat mirrors those cost increases. The assumption that taxes increase only as needed and required by the taxing entities is flawed. They will always find a use for any increase. The elderly are already allowed to defer taxes to when their estate is settled, no need for a reverse mortgage. But should they have to for arbitrary and capricious tax increases?