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Old 08-20-2006, 12:40 PM
 
66 posts, read 185,101 times
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I have perhaps an obvious question. The prices of renting homes seems absurdly high compared to the price of home sales. (cheap) Renting is nearly as much there as here in CA. Also, how is the cost of living so low,the sales tax is so high!
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Old 08-20-2006, 12:54 PM
 
Location: Murfreesboro, TN previously Brentwood, TN
225 posts, read 841,257 times
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Quote:
Originally Posted by chester's View Post
I have perhaps an obvious question. The prices of renting homes seems absurdly high compared to the price of home sales. (cheap) Renting is nearly as much there as here in CA. Also, how is the cost of living so low,the sales tax is so high!
I can't give you an "expert" explanation but I will give you my opinion. Murfreesboro is a college town so there is a big demand for temporary housing. The college students, plus your usual individual or families seeking temporary housing in any market, makes our demand for rental homes greater. Greater the demand, the higher the rent. However, more and more families are opting to purchase townhomes and inexpensive starter homes for their children attending MTSU rather than pay rent.

Tennessee has no income tax. This offsets a slightly higher sales tax. The sales tax is significantly offset by the lack of income tax (my opinion of course!) Also, I've been told by clients moving here from other areas that our housing prices and property taxes are extremely low compared to other parts of the country. In addition, TN tax laws favor businesses so we have secured a lot of small to large businesses that are moving here from other parts of the country. Nissan Headquarters is our newest corporation to move here leaving San Diego. So, you've got a nice income level, affordable housing, reasonable property taxes, favorable business taxes, affordable utilities, and no income tax. It adds up to low cost of living, especially compared to other parts of the country. Again, not an expert opinion, but my personal observation.
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Old 08-20-2006, 01:28 PM
 
66 posts, read 185,101 times
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I sent you a PM.................
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Old 08-21-2006, 12:56 AM
 
408 posts, read 1,375,555 times
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Some areas of town are reasonable rent wise and still much cheaper than a house payment (plus upkeep), but it probably depends on what part of town. Renting a house versus an apartment seems to be much higher.
It seems to me that people in states with income taxes get double taxed. At least in states I have been to that have one. Sure, grocery tax may be low or non-existant and their tax on other items is usually a little cheaper, but there is usually still some sales tax. So you are being taxed twice.
If two people in different states, one being with income tax of say 10% and one being in a state without it make $100, the person in the taxed state brings home $10 less. That is $10 less that could have been spent or even saved. If the person in the state with the income tax buys groceries, they may be taxed another 2% or more depending on the location. Now they are taxed at 12% essentially. If that person buys something non-grocery instead, tax could be 5% to 7% (these figures based on what I see in neighboring states, I am making up my income tax rate for this). Essentially, that person would then be taxed 15%-17%. So really, our 9.25% to 9.75% is cheaper and our money can stretch further.

I hope that example made sense. I know some states may not have sales tax on other things at least to a certain amount or at least it used to be that way. This is based on shopping I have done in the past few months while traveling and visiting our neighboring states.
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Old 08-21-2006, 06:31 PM
 
Location: on the road to less flab!
292 posts, read 891,317 times
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Default It's easier to control your spending...

and control how much sales tax you pay than to try to control your income tax (unless you don't want to have any $$$) or your property taxes. Coming from a high-tax state (CA), I already pay 7.75% sales tax, plus income tax, one of the highest gasoline prices in the nation (I think only HI pays more), and some of the highest utility rates in the U.S. So an extra 1.5 - 2% sales tax in exchange for paying lower for everything else doesn't bother me.
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Old 08-21-2006, 07:10 PM
 
66 posts, read 185,101 times
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true, our gasoline prices are astronomical. I was just expecting lower rent. When we first move there , I was planning to rent for 6 months or so first to be sure it was the right area to buy. But I dunno...
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Old 08-21-2006, 07:59 PM
 
408 posts, read 1,375,555 times
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Quote:
Originally Posted by chester's View Post
true, our gasoline prices are astronomical. I was just expecting lower rent. When we first move there , I was planning to rent for 6 months or so first to be sure it was the right area to buy. But I dunno...
chester's I just thought I would let you know I sent you a pm regarding this.
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