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Y'know, it's just on the outside edge of possibility that if Da Legeshlahture doesn't
implement a constitutionally acceptable fix, that a judge might just decide that
continuing to collect property taxes unconstitutionally is a no go and suspend all
residential property taxes until such time as a constitutional law is implemented.
No I don't think you're an idiot, and Santafescribe gives you some excellent advice.
A couple of thoughts. You have selected one of the most expensive areas around here. Why? You have something within a mile of the plaza -- you could sell it and buy some place not in such an expensive area and not make a major financial commitment. You can even get enough room to easily put up your friends when they visit and make it affordable to them. You might have to drive a little more, but you are going to end up driving in the area you selected.
Tax lightning. Our Republican candidate for Governor has come up with a plan that is incredible in its incoherence. The whole question is complex and I won't go into it here. But if she wins and is able to put her plan through, the last thing in the world you want to do is buy a house now. A rational person waits until after the election and the smoke clears.
I don't say this out of bias against our Republican nominee. I intended to vote for her, until she or her staff adopted this position.
Can you elaborate more on the candidates tax plan?
The reason for the area I am looking in is that I like it. I don't want to feel "disconnected" from downtown and I really like the area. Now if there is some area I should consider that I am not, please let me know.
Tax lightning. Our Republican candidate for Governor has come up with a plan that is incredible in its incoherence. The whole question is complex and I won't go into it here. But if she wins and is able to put her plan through, the last thing in the world you want to do is buy a house now. A rational person waits until after the election and the smoke clears.
I can appreciate that it may be off topic for the present discussion but could you provide some sort of clues that we can follow up and learn about this issue? Thanks.
Tax lightning -- existing home owners are limited to a 3% annual increase in assessment. But if you buy a home, then the first year the sky is the limit. This means that new owners may pay two-three-four times what persons in comparable homes pay. This started about 2001. Thus if you bought 2001 to present you get the short end. I bought in 2005 and have paid an extra $10,000 in taxes to date. I am now limited to 3% increases, but since my base is larger, my increases are larger. Depending upon the value of your house, the tax cost to a homeowner over a lifetime might reasonably total $100,000. We are not talking peanuts.
However, when I sell my house I am not at a disadvantage. Whoever buys my neighbor's house also gets hit by tax lightning and will pay a comparable tax.
Tax lightning incidentally has been ruled unconstitutional by two courts in Bernalillo County and in response the assessor in that county alone is rolling everyone back to the same 3% a year increase.
Denish would end tax lightning and roll everyone back to a comparable assessment. In effect, making the whole state like Bernalillo County. And comparable homes would pay comparable taxes. And again you would be at no disadvantage when you sold your house.
Martinez would end tax lightning for future sales -- say starting say Jan 1, 2102.
But there would be no rollbacks. Thus if you bought your house in 2001-11 you would stuck forever paying 2-3-4 times what your neighbors pay. And the dollar difference would increase every year.
And when you sell your house and your neighbor sells his house, the buyers get your assessments. So your house will sell for considerably less than a comparable home with lower assessments. It is a total b-f for anybody who bought their house 2001 to 2011. There is a permanent disadvantaged minority in New Mexico and it is these buyers. So why buy a house now? Depending upon the value of your house, adding up extra taxes and lost resale, it cost you a couple of hundred thousand.
Martinez in addition has said she will leave Bernalillo County alone and thus we would have two different systems in the state. When this was pointed out to her, she said she would consider making it county option.
But if you are in the wrong county -- and Santa Fe is definitely the wrong county -- you still get the short end -- big annual tax bill and a hit on the resale value of your home. So, I would advise against buying now unless you can think $100,000.00 loss without blinking.
This is something that realtors might not want to hear. They should get their professional associations to pressure Martinez to move away from her position.
I don't know what the "official" realtor association position on this tax lightning business is. My personal position is that our property taxes are very low here and already the money for schools is pitiful, so I don't mind paying the taxes on the value I ASSIGNED to my home by buying it at the price I did. Yes it creates inequities - on my short street all of the homes have wildly different valuations depending on when they were bought - but as long as the buyer knows the situation going in (and it's a condition of disclosure on transactions now), I'm good with it. I don't agree that the assessment affects the value of one house versus another; the buyer knows that the valuation is based on the price she pays for the house, whatever the current valuation.
[quote=santafescribe;15786675] but as long as the buyer knows the situation going in (and it's a condition of disclosure on transactions now), I'm good with it. I don't agree that the assessment affects the value of one house versus another; the buyer knows that the valuation is based on the price she pays for the house, whatever the current valuation.[/quot
First, many of the people -- including me -- were not informed. It was not the law for years. It certainly would have been the ethical thing to inform us. Yet many realtors did not. Still Martinez would condemn me and about 40% of the population to pay higher taxes as long as we own our houses. So her proposal fails to meet your very basic test of fairness.
Second, two houses, identical side by side. A pays $1,000 per year in taxes. B pays $3,000. A $2,000 difference. That difference will get bigger with every increasing assessment and every tax rate increase. The city is consider one right now.
If we assume 3 per cent assessment increase every year, and NO tax increase, then over thirty years house B will pay $95,000 more in taxes.
Would I pay more money for A than B? Yes.
Third. If I could wait a year or so and make sure that I avoid paying that extra $95,000 then why not wait? Rent a year? I sure would.
I'm sorry -- it is a big incentive NOT to buy now. And people deserve to know. They shouldn't be treated like so many were.
I agree that many buyers were unaware of the hit they would take, but I also see that
as largely their own responsibility. The various agents involved should have made the
situation clear, but the potential homeowner should always have a reasonable understanding
of their annual tax liabilities before making an offer.
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I don't know about that.
