Random Property Tax stuff (Austin: assessor, mortgage, credit)

[riaelise]

Originally Posted by CarnivalGal

Even if you decide to sell the place and rent something, rents increase as housing prices and taxes increase. So even though I pay $1,000 a month in property taxes right now, there's no way I could rent anything near my home for that amount. Even the cheapest apartment in my zip code is still more per month than I pay in taxes (I just did a quick search). Assuming the house is paid off, as in the scenario you presented, taxes+insurance on a house owned outright is still probably going to be less than rent+insurance on something else.

The only way to really lower your monthly payments is to downsize substantially and move pretty far out. But pretty far out is getting farther and farther. Leander used to be that for a lot of people, because they couldn't afford to live closer. But areas like Leander are some of the hottest real estate markets around now.

We intend to drastically downsize. We don’t need 3700 sq ft at that age.

We also intend to live farther out. If I’m not working there’s no real need to live in Austin. We don’t come into town much anyway. My mom lives in gtown and rarely goes to Austin. We’re ok with belton, Taylor, Georgetown

We could probably afford a rent in the 1500-2400 range.

It pains me to think this but there’s also the option of my moms house, which I will inherit. We can live there too, far less taxes and monthly payment.

I don’t need to own as a retiree in fact I don’t think I want to. I want the freedom of moving elsewhere after a year is up if I choose.

[riaelise]

Originally Posted by Trainwreck20

We used to appeal pretty much annually (back in the 2000s), but not often now - a few times they have greatly undervalued the house based on our comps, and the rest of the time it is pretty close. Our house is 'modest' for Austin (our current taxes are <$9k), but we still can't itemize realistically - the standard deduction is so large now, that it effectively would cover us to much higher tax bills.



We may sell, this was just a look at what the taxes would be if we stayed. On paper, the house could potentially appreciate by as much as $600k more than the taxes we pay on it. Even at an annualized appreciation of 2%, the house will be worth more than the taxes paid on it.

Renting it might be an option. Once we pass away, the house will enter a special needs trust. If she stays, that is fine, but if she moves, then the trust will either sell the house or rent it out, depending on the finances.

We live and die by schedule a. That 24,400 deduction isn’t even close to our itemized deductions. Before that stupid cap we wrote off like 37000.

The house is very expensive to maintain, including property taxes, and I don’t want to deal with that. I fully intend to walk awAy from the business world at 62

[Trainwreck20]

Originally Posted by riaelise

We live and die by schedule a. That 24,400 deduction isn’t even close to our itemized deductions. Before that stupid cap we wrote off like 37000.

But if you are paying ~11k in taxes, you are basically only losing 1k in write-off, correct? So you can still write-off 36k? Or else I am missing something entirely - is interest on a mortgage also capped or something? We have no payment left, so no interest to deduct. The 8.5k in property tax and the whatever we have in sales tax write-off doesn't come close to 24.4k for us.

Our house is 2400 sf, which is plenty for us (family of four). Our one child will likely be living with us indefinitely, though, so we don't want to go too small.

Originally Posted by riaelise

The house is very expensive to maintain, including property taxes, and I don’t want to deal with that. I fully intend to walk awAy from the business world at 62

That is about my ballpark age, maybe try to sneak out a bit earlier if I can. My wife is a bit younger, so I have to convince her to keep working for health insurance until I hit 65 .

[riaelise]

Originally Posted by Trainwreck20

But if you are paying ~11k in taxes, you are basically only losing 1k in write-off, correct? So you can still write-off 36k? Or else I am missing something entirely - is interest on a mortgage also capped or something? We have no payment left, so no interest to deduct. The 8.5k in property tax and the whatever we have in sales tax write-off doesn't come close to 24.4k for us.

Our house is 2400 sf, which is plenty for us (family of four). Our one child will likely be living with us indefinitely, though, so we don't want to go too small.



That is about my ballpark age, maybe try to sneak out a bit earlier if I can. My wife is a bit younger, so I have to convince her to keep working for health insurance until I hit 65 .

We still have a mortgage payments. We bought the house 5 years ago. So between the interest, the taxes, and the misc charitable stuff, it's more than the standard deduction.

As for our kids, barring anything catastrophic, they have about 18 years to figure out their living situation, lol, because once I retire THAT'S IT.

My husband intends to work until at least 65, so that helps money wise.

[Austin97]

Originally Posted by CarnivalGal

Even if you decide to sell the place and rent something, rents increase as housing prices and taxes increase. So even though I pay $1,000 a month in property taxes right now, there's no way I could rent anything near my home for that amount. Even the cheapest apartment in my zip code is still more per month than I pay in taxes (I just did a quick search). Assuming the house is paid off, as in the scenario you presented, taxes+insurance on a house owned outright is still probably going to be less than rent+insurance on something else.

The only way to really lower your monthly payments is to downsize substantially and move pretty far out. But pretty far out is getting farther and farther. Leander used to be that for a lot of people, because they couldn't afford to live closer. But areas like Leander are some of the hottest real estate markets around now.

East is the best way. You can still get small unrenovated homes for under 400K inside 183. Just outside 183 the prices drop quite a bit.

[Austin97]

Originally Posted by Trainwreck20

But if you are paying ~11k in taxes, you are basically only losing 1k in write-off, correct? So you can still write-off 36k? Or else I am missing something entirely - is interest on a mortgage also capped or something? We have no payment left, so no interest to deduct. The 8.5k in property tax and the whatever we have in sales tax write-off doesn't come close to 24.4k for us.

Our house is 2400 sf, which is plenty for us (family of four). Our one child will likely be living with us indefinitely, though, so we don't want to go too small.



That is about my ballpark age, maybe try to sneak out a bit earlier if I can. My wife is a bit younger, so I have to convince her to keep working for health insurance until I hit 65 .

mortgage interest is capped at a loan of 750K

[Trainwreck20]

Originally Posted by Austin97

mortgage interest is capped at a loan of 750K

Ah, I remember something about that now. But with 11k in taxes, their mortgage is somewhat less thn $500k, I would assume.

In any case, the increase in the standard deduction can't really cost anyone money in-of-itself, although the mortgage interest cap and property tax cap could. It looks like from her case that she just loses about $1,000 in deductions due to the tax-cap, although that will climb.

[CarnivalGal]

Originally Posted by Austin97

East is the best way. You can still get small unrenovated homes for under 400K inside 183. Just outside 183 the prices drop quite a bit.

That's true now, but the OP was talking in the future when they retire. That probably won't be the case then.

[CarnivalGal]

Originally Posted by Trainwreck20

Ah, I remember something about that now. But with 11k in taxes, their mortgage is somewhat less thn $500k, I would assume.

In any case, the increase in the standard deduction can't really cost anyone money in-of-itself, although the mortgage interest cap and property tax cap could. It looks like from her case that she just loses about $1,000 in deductions due to the tax-cap, although that will climb.

I live in the same area as riaelise, with about the same property taxes, so about the same home value. We got screwed too with the tax changes, between the property tax deduction and mortgage interest. We ended up paying a decent amount more in federal taxes as a result. We've owned out house since 2005.

[CarnivalGal]

Ironically, I was listening to the Clark Howard podcast on my way home from work, and he talked about how residents in states with high property taxes were hit particularly hard with the latest tax changes and specifically singled out Texas residents as hardest hit.