Michigan Property Taxes are BAD (Detroit, Flint: real estate, luxury, income)

[Need_affordable_home]

Before you guys jump to conclusions, will you tell me the percentage of property taxes? Because I think its alot cheaper than you think. Houses are extremely cheap in MI so the taxes should be low on one of those affordable houses.

[MovingAround2]

You must not be very familiar with property taxes around the country. Michigan's is right in line with other places. A little higher than some, lower than some, about even with some. They are not abnormally higher like you are making them seem.

[Kingsnkali]

Michigan ranks as the 15th most taxed state in property taxes. Michigan residents pay more per capita in property taxes than California residents. And the mean home price in California is probably close to 3 times as much as Michigan. By the way, California is ranked 29th in property tax collection. Kentucky 45th. Tennessee 41st. Indiana 26th. Of course, New Jersey wins the prize at #1 for over-the-top property taxes.

What started this thread was when I was looking at a home in Manistee and used the Michigan property tax calculator for Manistee County. I almost fell out of my chair seeing the range of approx $7000 to $9000/yr depending on if the property was homestead or not. That sky high tax rate is a loud "no way" for the next generation of 80 million Baby Boomers about to retire.

And this is topic is NOT about "selfish" retirees vs "the Children". It's more like economic reality. Would you rather have all those small Michigan towns just turn into ghost towns? There are hardly any jobs now. And most of the towns are losing population. Retirees could provide a functioning economy for these rural areas. Service jobs instead of For Sale signs rusting in the breeze. Home forclosures and tax sales do NOTHING for the sacred cow Michigan education budget. They make it worse. Just look at Detroit for your "education budget model". Blight and abandoned houses do not produce a dime of revenue.

So us "selfish" outstate retirees will just go elsewhere. And perhaps Michigan should just tax TWICE as much so the Michigan kids are TWICE as smart! All the neighboring states with real, functioning economies will certainly appreciate it and welcome them with open arms.

[Need_affordable_home]

OK I googled this and the taxes are high but not insane. The percent rate if NOT hometead is between 5% and 6.5% of assessed value. For those homesteaded, its about 2/3 that. But they tend to assess the taxable value at about half of market value whereas in many other places the assessed value is at or near market value. A $200k house may be assessed at at say $110k and with a homestead you pay 3.5% of that or $3850 taxes a year. In FL a $200k house would be assessed at $180k minus $25k homestead and you pay 2% in taxes, this comes out to $3100. But dont forget that houses in MI are much cheaper, a $200k house should be a very big luxury house in that state. I can find hundreds of houses for under $50k and I dont mean Detriot either! I found one example: $29,900 5 Bed, 2 Bath, garage 2,000 Sq. Ft. Needs a little TLC. The property taxes on that house would be about $600 a year.

Listen carefully: If you dont want to pay $6000 in property taxes, dont buy the most expensive house! Buy a house costing $30k, $50k, maybe even $100k if you want a really nice big one. I am going to defend Michigan. Taxes are not insane(unless you arent homesteaded) but you only need one house! I can name many other states with higher property taxes than Michigan!

[Milabs]

Originally Posted by sundancer

I think michigan is very cheap compared to other places for property taxes. I have a $400,000 house on 2.5 acres and pay only $3200.00 per year. Our sales tax is also cheaper than down south. Im looking to move to texas, there property tax is a flat 3% of your sale price, my house in texas would be $12,000 a year and there sales tax is 8%. But they dont have an income tax so thats about a break even with the two combined. I hate to think of moving but michigan is going down the drain so fast. I build houses for a living and nothing is selling, new or used.

I agree with you 100% taxes in MI aren't that bad compared to other places...if you are in the housing market..stay away from Florida..they right now are at the stand still unless you do nothing but custom million dollar homes and even those are slowly down a bit.

Mi right now is a tough place to live for some ppl..not everybody..but some ppl. Those who have factory jobs are the hardest hit...plants are closing left and right and what ever jobs are out ther they are scooping up even though the pay is less than half they were making. Very hard to watch friends go thru this.

Dh is in the electrical business...sales side...so we are doing quite well and planning ahead..we saw this downfall coming 4 yrs ago and have been saving our money like little chipmunks. We love MI and have no plans on leaving...if he lost his job tommorow we could live 3 yrs without a income and once his profit sharing check comes in next month you can bump that up to 5 yrs without a paycheck.

His fellow managers in Florida are laying ppl off left and right because they deal in mainly residential and that's at a stand still...AZ is right behind...nothing is selling there either.

[magellan]

Originally Posted by [I

[/i]Kingsnkali;362709]Michigan ranks as the 15th most taxed state in property taxes. Michigan residents pay more per capita in property taxes than California residents. And the mean home price in California is probably close to 3 times as much as Michigan. By the way, California is ranked 29th in property tax collection. Kentucky 45th. Tennessee 41st. Indiana 26th. Of course, New Jersey wins the prize at #1 for over-the-top property taxes.

What started this thread was when I was looking at a home in Manistee and used the Michigan property tax calculator for Manistee County. I almost fell out of my chair seeing the range of approx $7000 to $9000/yr depending on if the property was homestead or not. That sky high tax rate is a loud "no way" for the next generation of 80 million Baby Boomers about to retire.

And this is topic is NOT about "selfish" retirees vs "the Children". It's more like economic reality. Would you rather have all those small Michigan towns just turn into ghost towns? There are hardly any jobs now. And most of the towns are losing population. Retirees could provide a functioning economy for these rural areas. Service jobs instead of For Sale signs rusting in the breeze. Home forclosures and tax sales do NOTHING for the sacred cow Michigan education budget. They make it worse. Just look at Detroit for your "education budget model". Blight and abandoned houses do not produce a dime of revenue.

So us "selfish" outstate retirees will just go elsewhere. And perhaps Michigan should just tax TWICE as much so the Michigan kids are TWICE as smart! All the neighboring states with real, functioning economies will certainly appreciate it and welcome them with open arms.

I think you're assuming a lot in your forecast that retirees would rescue these small towns. For one thing, retirees would probably not have their primary homes in these towns, so the 1/2 of the year that they are somewhere else, what happens to all the service jobs devoted to retirees?

Small towns that aren't within 100 miles of a good-sized city (at least 50 - 75,000) anywhere in this country are all going to die a slow death as people continue to migrate toward urban centers and their "exurbs". There is no magic white horse coming to save these towns, no matter how low their property taxes could be.

But really, if you're comparing Manistee to California, you yourself said that California home prices are three times that of Michigan. So a $300,000 home in Manistee is $900,000 in California. What does it matter if you are OVERPAYING for a house in California, or paying into property taxes in Manistee? It's still money that has an "opportunity cost" to it.

I ran the calculator on the Michigan Treasury website for a $300,000 home, Manistee County, Manistee Schools:

Manistee Township: Homestead rate - $3621 year (24 mills), Non-homestead (don't live there full time for non-Michiganders) - $6321/year (42 mills)
Manistee City: Homestead rate - $6321 year (42 mills), Non-homestead - $9021/year (60.14 mills)


Holy crap! There's the problem. It's not the State of Michigan's property tax, the City of Manistee's property tax rate is extraordinarily high. 42 mills is one of the highest I've ever seen (East Grand Rapids is one of the highest in the GR area at about 38 mills). Most are in the 28 - 32 mills.

Try something in Manistee Township, or one of the other surrounding townships.

And in conjunction with what Milab said, lower property taxes in Florida are offset by property insurance bills that are skyrocketing to $5000 - $6000 year. At least you can feel good that your property taxes are going toward SOMETHING (education, police/fire, etc.) and not still paying insurance company losses on Hurricane Andrew in 1992.


In my opinion, there is nothing fundamentally wrong with Michigan's structure (government, taxation, policy), the only thing majorally wrong is that U.S. automakers continue to make SUV's and trucks that very few people in this country want to buy anymore, plain and simple. But the problem is is that the Big 3 have 0 credibility when it comes to making top quality, well-designed, fuel-efficient or hybrid mid-sized cars, because they have fought the government (we the people) for so long. People just laugh at a GM hybrid or electric car, or roll their eyes when one of the Big 3 wins a quality or safety award (as if the judges may have been paid off). Until they genuinely change the culture in the Big 3, they'll never recapture the attention of U.S. car buyers. You can directly correlate Michigan's job losses to losses in market share for the Big 3. But just like Michigan reinvented this country with the explosion of the automobile in the 50's, we once again will reinvent this country with another revolution, with refocused energy.

But again I digress from the property tax discussion. Sorry.

[Kingsnkali]

Magellan,

Yes, the property was in the city of Manistee. They sure love their property taxes. They must get rich Chicago folks buying summer homes there to be able to tax like that. The property taxes look about twice as high as they should be to me. They've priced this humble Californian out. I sure like that part of the state though. I like parts of the UP as well.

Guess I'll buy a little tar roof shack somewhere in the woods and raise chickens. I'll buy one helluva fishing boat though!

I just wish the tax man would look at income taxes for revenue instead of taking it out of you through your property. It encourages people to NOT improve their property if they're just going to be nailed with a huge tax increase. And it kills a resale market for people trying to unload a home when they lose their job etc.

Maybe I'm just looking at it the wrong way. Michigan might be a great opportunity for picking up distressed property for free via county tax sales when all the properties go under. Those high property taxes will be like a rope around the sellers neck. No buyers. I guess it doesn't matter to the state. They just want their property taxes and the hell with the poor seller.

[Tom Stockton]

Michigan just raised my home's taxes by 54.7% to $7800! They say they just discovered an old pole barn that was there when I bought it in 1988.
The clueless governor fiddles while the state burns. Her solution: Raise taxes!

[Ponderosa]

MI property taxes are high in comparison to some states, but their income tax is low. In fact, they exempt pension income almost completely so many retirees would pay no state income tax or very, very little. I was unaware of this until recently and am now considering MI as a potential "home base" for retirement.

[UpperPeninsulaRon]

I attended universities in Michigan, worked in Michigan, and after taking an early retirement am living and working again in the Upper Peninsula. So far, so good. But I am trying to get my parents (both 87) to move to Gladstone in the Upper peninsula so they would be a few miles away from us. They were all set - AND THEN - my dad says "Why are the property taxes so much more than I am paying in Chicago?" I have no answer. The deal is off. Maybe I should move from Michigan to Illinois, where I would then support the Illinois economy. I would love love for the Governor to give me an answer why I shouldn't move and why my elderly parents would get no property tax break to encourage them to move to Michigan.