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This seems like a bad idea. Around here, assessed values tend to trail market value by several hundred thousand dollars, so the idea of the county/city coming to me and buying me out of my condo for half a million less than I could get on the open market sounds rather frightening.
Applied to a larger scale, what stops a local government from abusing this, intentionally under-assessing for the purpose of scooping a la eminent domain?
I think you're misapplying the proposal. The reality is when local governments assess values & property taxes, they typically over-assess because it is in their best interest to do so (they collect more tax money). Yes, there is a process for the homeowner to dispute the assessed value, but the arbiter of such a dispute is the assessor's office itself - hardly an uninterested 3rd party.
Each year, when I get the proposed assessed valuation on my properties, I spend time researching the actual closed transactions that are true comps during the past 6 months and past 12 months, and every time I come to the conclusion that the county is wrong for one reason or another. I file a formal dispute, and usually an adjustment is made to my assessed valuation. It is a big bother, and many homeowners don't dispute clearly incorrect valuations.
That is, there is no check & balance on the assessor's office. The proposal could provide such a check & balance - if the assessor over-assesses the value of the property, they have to put-up-or-shut-up. If they accidentally-on-purpose assess my property at $100K more than its true market value, I should be able to "put" it to them (a "put" in the stock option sense such that I have the right but not obligation to sell the property to the assessor at their price, and the assessor has the obligation to buy it at that price if I exercise the "put.")
Similarly, under the proposal, if the property owner is disingenuous and under-values their property, it is put-up (the deed)- or-shut-up. If I accidentally-on-purpose under value my property by $100K, then the assessor could force a transaction at that price - or a 3rd party could "claim" the property at that value.
I think you're misapplying the proposal. The reality is when local governments assess values & property taxes, they typically over-assess because it is in their best interest to do so (they collect more tax money). Yes, there is a process for the homeowner to dispute the assessed value, but the arbiter of such a dispute is the assessor's office itself - hardly an uninterested 3rd party.
Each year, when I get the proposed assessed valuation on my properties, I spend time researching the actual closed transactions that are true comps during the past 6 months and past 12 months, and every time I come to the conclusion that the county is wrong for one reason or another. I file a formal dispute, and usually an adjustment is made to my assessed valuation. It is a big bother, and many homeowners don't dispute clearly incorrect valuations.
That is, there is no check & balance on the assessor's office. The proposal could provide such a check & balance - if the assessor over-assesses the value of the property, they have to put-up-or-shut-up. If they accidentally-on-purpose assess my property at $100K more than its true market value, I should be able to "put" it to them (a "put" in the stock option sense such that I have the right but not obligation to sell the property to the assessor at their price, and the assessor has the obligation to buy it at that price if I exercise the "put.")
Similarly, under the proposal, if the property owner is disingenuous and under-values their property, it is put-up (the deed)- or-shut-up. If I accidentally-on-purpose under value my property by $100K, then the assessor could force a transaction at that price - or a 3rd party could "claim" the property at that value.
The point I'm making is that it's a two-way street, not just for high and low but for seller and government. An initiative like this meant to avoid excessive taxing could be abused in the opposite direction, especially if there's a clause that allows for a government or third party to force a sale at the assessed price.
I didn't assess my place to be taxed at a value $500k less than it's worth, the city did. Under this proposal, what recourse do I have to stop the triggering a force sale of my property for $500k less than it goes for on the open market? Beg the city to assess (and tax) me much higher to fend off 20 people trying to trigger the sale of my home at assessed price?
While intended to be a check and balance, it can be subverted by a private market that keeps ahead of the government. It ends up hurting some of the people it was intended to protect.
My grandparents and my parents and my inlaws all lost their farms and ranches due to false property tax assessments (Highest and best use, BEFORE ag / farm exemptions were implemented)
I'm likely to lose mine before I croak. (My valuation is 10x what it cost me to build and taxes have increased from $800/ yr to over $15,000). Same home, no improvements, just older and worn out.
I proposed this during the 2008 housing crisis... "Just write me a check for the assessment, and it is yours".
I would gladly sell to assessor for what they consider it is worth ~2x market value, which I have advertised it at 1/2 the assessment and no bites. (Tho the assessor really likes it and claims he wants his CA parents to buy it at the tax auction.)
We're toast. I pounded every nail and laid every brick with the intention to STAY in my custom designed and built home. but... the tax assessor has other 'higher valuation' plans. We've been forced to leave (3) very prime locations due to Californication of property values. No other state besides CA has Prop 13, so many states have been ruined and displaced tens of thousands of senior citizens, the very people who made these communities nice and desireable placed to live.
Poof, your gone.
Sorry to hear about your woes. Sounds to me like you have an issue with either the accuracy of your assessment, or you need a better real estate agent. I’m guessing it is the former. I’ve never been in a situation where the assessment is do out of whack, other than to suggest appealing the assessment (which I’m sure you have done). Long story short, if you can’t or don’t want to pay the property taxes, and you can’t get any relief, then selling (even at a lower than assessed value) may be your only option. Again, sorry you find yourself in this situation.
All taxation is theft, but property tax is really a wealth tax. To me that makes it worse because a lot of people paying it have no wealth. I can opt out of the payroll tax by quitting my job, the only way to opt out of property tax is to give up my property.
Property tax collection is a gimmick. If the taxing authority can't steal enough money based on the current property valuations, they just increase the mill rate. When valuations/revenue come in higher than they expected, they rarely lower the mill rate, they just find more ways to spend the money.
I liked the original post about the king's clever method of keeping people honest even if its not applicable to modern times, thanks for sharing.
]“All taxation is theft”[/b]….I’ll remember thinking of you when the police, fire department, and EMS fail to respond to the thief breaking into your house, the fire burning your residence down, and your wife calling because you are going into cardiac arrest. Because all taxes are theft. Another MAGA zealot no doubt.
I didn't take any political science classes in college, but did get a bit mid-career training about the power of government to make you pay for things you don't personally want.
So yes in that sense it is theft, since your not giving up your money willingly.
BUT, cheap shot at "MAGA zealots".
Right now, in my "neighborhood" we are trying to get folks to agree to join the rural fire department. They have provided both medical and fire service even though we are out of the fire district and don't pay property taxes to the district.
Us "Maga zealots" want to join the fire district. It is those "Seattle liberals" with their second homes that don't want to join the fire district.
Their argument is that the fire district has done it in the past without payment, they will continue to do so in the future.
Why do we have to pay??
Come to think of it....that basically is the Liberal argument...we don't have to pay for anything.
I have never had an issue with assessments. I do understand how they are calculated. I did appeal my assessment a couple of years ago and got a substantial reduction in my property taxes..
Even the assessor was impressed with my analysis. Well, let's just say he couldn't argue with it. The comparable was a willing selling, willing buyer under NO COMPULSON to sell and it was next door. The buyer got a real deal and so did I.
All taxation is theft, but property tax is really a wealth tax. To me that makes it worse because a lot of people paying it have no wealth. I can opt out of the payroll tax by quitting my job, the only way to opt out of property tax is to give up my property.
Property tax collection is a gimmick. If the taxing authority can't steal enough money based on the current property valuations, they just increase the mill rate. When valuations/revenue come in higher than they expected, they rarely lower the mill rate, they just find more ways to spend the money.
.
Taxes support the community, the cops/firefighters/EMT/hospitals/schools. You can easily control what you pay in taxes. Buy a big mansion and the taxes will be higher than if you live in a trailer on a rural lot with no city services. I personally knew the ex-wife of a celebrity, she was paying $350,000 a year in property taxes (yeah almost $1000 a day to live in her own house). She had the money but combined with the other expenses she realized she didn't need to live in that house, blowing 600K+++ a year just in taxes/utilities/insurance. Live there 10 years, spend 6mm!
The taxes on this home ^^^ are 220K a year. A record producer owned it (went broke), a rapper then bought it (also went broke). Live here 5 years and you will give the county 1mm to live in your own house! Think that is crazy? Move to a cheaper place: https://www.realtor.com/realestatean...?ex=2944242284
Taxes drop to 42K a year yet it is still a big mansion. You could live here 5 years and still not spend what the first house spends in 1 year!
The analogy to shipping cargo doesn't hold. Cargo is intended to be sold fairly soon, whereas a homeowner may not want to sell for decades.
Also home appraisal is way beyond the capabilities of most homeowners. The shippers in the tweet were professionals and businessmen. There would be so many mistakes and hijinx if property appraisal were turned over to homeowners.
Yes. I cannot imagine the stress every year, when everybody has to determine the value of their property and hope that they are right. Make an honest mistake and you have to call movers.
Quote:
Originally Posted by Thulsa
That's a great idea.
Suppose I had some obnoxious neighbors, but they weren't breaking laws so nothing could be done.
With this forced sale concept, I could buy their house and force them out. Yes, I might not make a profit, but it's something I could easily do.
Also by having a forced sale law, it would be a handy for a group of people to rid their neighborhood of people who have an unfortunate skin color, or who go to the wrong church.
Some variation of this would almost certainly happen somewhere. We see toxic HOAs target some homeowners for silly reasons, this would just allow city/county governments to do the same thing.
Danish economist Paul Hünermund recently posted an interesting tweet:
"To collect taxes, King Christian IV of Denmark (12 April 1577 – 28 February 1648) asked captains of ships to estimate the value of their cargo, which was applied as the tax base without further audit. But the king also claimed the right to buy the entire cargo at exactly that price."
Perhaps when local property tax assessors say the value of a residential house is $X, the homeowner ought to have the right to "put" the property to the assessor's office at that price.
This could eliminate the entire property tax appraisal appeal process, making county governments that much more efficient. "OK, you say my house is now worth $1,000,000 ??? Fine. Here are the keys, and must give me $1,000,000 cash by the end of the week."
Or, perhaps another interesting way would be for homeowners to self-declare the value of their property for tax purposes - with the twist that anyone can force a purchase of the property at that self-declared price.
Any government will find a way to add new taxes somehow.
Can't you see what's happening here?
If the cargo ships thinks the king might buy it, they will set a higher value thinking"The kings got money"; and that, therefore, means he can collect higher taxes on a higher valuation WITHOUT ever buying a single thing.
..just like charging the US government $250 for a new $19.99 toilet...just because it's the Fed.
But if the US Fed says "if we decide we don't like the toilet seat in a week you MUST but it back at a 10% penalty, you betcha that $250 toilet seat will become maybe a $50 toilet if not the original $19.99.
Having to pay an extra $2 or $5 will be easier on the seller than $25 to buy back at $250.
But I don't want to sell my house. I don't care if I can get well over the market value. I like my house and I don't want to move. And I really do not want the labor and expense of moving. Moving is hard work and it is expensive.
Also, I don't want my city or county to buy a bunch of expensive houses, because you know where that money is coming from: from me and the higher tax rate I would have to pay so the the governement would have enough money to buy all those houses that they don't need. I want my local government to pinch pennies and not spend money that they don't need to spend.
Last edited by oregonwoodsmoke; 06-15-2022 at 10:49 AM..
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Think that is crazy? Move to a cheaper place:
