Can anyone explain to me why this house has not sold (Baltimore: mortgage, credit)
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Well, obviously, by definition the word "gem" implies the remainder is less than said gem. Like if I say "hey, Calvert Hall, that was a real gem of a comment" it would accurately imply that I think the other 99% of your comments are useless garbage.
I read continually about the high taxes in Baltimore, but I didn't realise they were that high. That's incredible. That equates to about £6700, and you would not pay that anywhere in the UK on any property of any value. Here we have "council tax" - it's much the same sort of thing - there are 8 bands, A - H, according to property value. Each borough levels their own charge, but government legislation restricts increases to no more than 2% annually. They vary, but not massively. In my London borough, on our "F" rated house (worth about $1.9M) we will pay $3,000 in 2016. If we had a $5M mansion, the highest it could be is $4100 in tax. If there is only one occupant, they get a 25% discount.
If the Bolton Hill house were in my borough, the tax would be $1850 a year. And this borough usually ranks in the top 5 in the country for schools.
How can anyone afford to live in Baltimore at those kind of tax rates? It's incredible. I now understand a lot more about why folk live in the county rather than the city. Considering how much of the city looks pretty much abandoned, what exactly do they do with the revenue? Even Bolton Hill looks like it needs its roads re-surfacing and sidewalks weeding.
I guess the main reason for this is that the majority of our council funding comes from central government, with local tax only making up about 30% (and the central funding is currently being ruthlessly cut to try and reduce our crippling deficit). Does Baltimore get state and/or federal funding of any kind?
That'd be akin to me saying "your VAT tax is 20%?! The most I've ever paid for a sales tax is 6%." It only works to consider total tax burden; slicing out one tax or another doesn't give an accurate picture.
I wonder what the property tax would be on this "gem."
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Originally Posted by james777
$9,919.00 in 2015 according to the listing, which is quite a break compared to the $9,660.00 it was in 2013.
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Originally Posted by 640TAG
Is that what you would actually pay annually? Really? Or is it just a multiplier by a decimal of some kind?
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Originally Posted by james777
Yep, that's what one would pay annually, and you have only a few months to pay it or your property will go to tax sale. This money goes to pay for local services, such as the some of the worst schools in the world, police that might show up if you call them a few times, and the mayor's chauffeur driven car. Even after one owns a property here in the US, the property owner is still a tax slave to the local officials.
Thereby demonstrating that a socialist Utopia exists not only in Eurabia but also on this side of the pond.
I read continually about the high taxes in Baltimore, but I didn't realise they were that high. That's incredible. That equates to about £6700, and you would not pay that anywhere in the UK on any property of any value. Here we have "council tax" - it's much the same sort of thing - there are 8 bands, A - H, according to property value. Each borough levels their own charge, but government legislation restricts increases to no more than 2% annually. They vary, but not massively. In my London borough, on our "F" rated house (worth about $1.9M) we will pay $3,000 in 2016. If we had a $5M mansion, the highest it could be is $4100 in tax. If there is only one occupant, they get a 25% discount.
If the Bolton Hill house were in my borough, the tax would be $1850 a year. And this borough usually ranks in the top 5 in the country for schools.
How can anyone afford to live in Baltimore at those kind of tax rates? It's incredible. I now understand a lot more about why folk live in the county rather than the city. Considering how much of the city looks pretty much abandoned, what exactly do they do with the revenue? Even Bolton Hill looks like it needs its roads re-surfacing and sidewalks weeding.
I guess the main reason for this is that the majority of our council funding comes from central government, with local tax only making up about 30% (and the central funding is currently being ruthlessly cut to try and reduce our crippling deficit). Does Baltimore get state and/or federal funding of any kind?
Baltimore receives a lot of state aid. Other poor jurisdictions in Maryland also receive a lot on a per capita basis but, because the city is both heavily populated and poor, it receives the most state aid of any jurisdiction. Interestingly, even a house with this value in lower taxed Baltimore County would still pay a little more property tax than that $5M mansion in England.
Especially in today's low interest rate environment, the city's high taxes add significantly to the monthly mortgage payment. In the city, taxes will make up at least 30%. This drives down property values relative to the lower tax suburbs to a point that many buildings can't justify maintenance or rehab. The issue often isn't purely an issue of the ability to pay the mortgage. Instead, the city properties often need to compete head to head with close by properties in the counties.
City neighborhood that offer great amenities can compete because, for the most part, great urban amenities aren't available in the counties... hence no real competition. On the outskirts of the city,where the houses on either side of the city line offer a similar lifestyle, the high taxes really take a bite out of city home values. There is nothing like Bolton Hill in the counties, so if you want to live someplace like Bolton Hill you will have to live in the city. The high tax bill hurts the value of this house, just how much is hard to say but probably not more than $150,000.
Baltimore receives a lot of state aid. Other poor jurisdictions in Maryland also receive a lot on a per capita basis but, because the city is both heavily populated and poor, it receives the most state aid of any jurisdiction. Interestingly, even a house with this value in lower taxed Baltimore County would still pay a little more property tax than that $5M mansion in England.
Especially in today's low interest rate environment, the city's high taxes add significantly to the monthly mortgage payment. In the city, taxes will make up at least 30%. This drives down property values relative to the lower tax suburbs to a point that many buildings can't justify maintenance or rehab. The issue often isn't purely an issue of the ability to pay the mortgage. Instead, the city properties often need to compete head to head with close by properties in the counties.
City neighborhood that offer great amenities can compete because, for the most part, great urban amenities aren't available in the counties... hence no real competition. On the outskirts of the city,where the houses on either side of the city line offer a similar lifestyle, the high taxes really take a bite out of city home values. There is nothing like Bolton Hill in the counties, so if you want to live someplace like Bolton Hill you will have to live in the city. The high tax bill hurts the value of this house, just how much is hard to say but probably not more than $150,000.
Pretty much chicken and egg - median owner-occupied home value in Baltimore City is $160K compared to the state average of $290K and the Balt. County average of $250K. It's logical that the tax rate in the city is higher because of that fact; it's also logical that said higher tax rate has an inverse effect on sales price and therefore assessments.
I don't find that to be a positive or a negative either way as the real-world impact on a practical level is limited. Whether the tax rate is $1.02/$100 or $2.02/$100 doesn't change the underlying equation. A Baltimore rowhome (or a County SFH, for that matter) worth $2K a month is still going to be worth $2K a month, whether that's $1500 in mortgage + $500 in taxes or $1700 in mortgage + $300 in taxes. I'm not sure what you mean by the tax rate making it harder to "justify maintenance or rehab;" if anything, a lower property sales price reduces the upfront barriers to ownership and encourages owner-occupancy. Swaths of the city are garbage because of all sorts of factors (crime, schools, job availability, etc.), but I don't think the property tax rate is one of those factors.
That'd be akin to me saying "your VAT tax is 20%?! The most I've ever paid for a sales tax is 6%." It only works to consider total tax burden; slicing out one tax or another doesn't give an accurate picture.
I'll take your 5% sales tax and raise you the fact that "if it moves, tip it 20%"!
I appreciate that whenever you look at a restaurant menu, you add 25% to the pricing (sales tax + tip). We don't.
But your point is salient, which is why I brought up the matter of tax proportionality.
I cannot see how crippling property tax levels helps Baltimore in any way, shape or form. By your logic, there would be nothing wrong with tax making up 100% of the monthly payment and property being given away free. Bernie Sanders would probably concur
I read endless complaints about the property tax rate in the city, which, along with crime, and the quality of services delivered for the tax seem to be the biggest disincentives for folk to move to Baltimore (and an increase in working, tax paying residents has to be what it needs). The tax rate keeps a lid on property price gains, which can trap folk into an area or the city in general - especially if prices elsewhere are on a steeper rise. On the subject of chicken and egg, it would be better for everyone if the tax take could be increased by an influx of population (some of whom would be trailblazers and start to gentrify other areas - and there is AMPLE room for gentrification in Baltimore!).
The lid on property prices certainly creates some incredible opportunities. I see a 3100sqft end rowhouse just appeared on Zillow for $73K (needs refurb) in Reservoir Hill. Decent looking street. A vacant right opposite, then just along a large, detached glitzy looking new-build (could be a very extensive rehab - hard to tell). It's these crazy juxtapositions that makes Baltimore so interesting, so compelling. Obviously a very mercurial neighbourhood - but an insane amount of house for the cash.
I've learned a lot in this thread, so again, thanks to all for the education.
Pretty much chicken and egg - median owner-occupied home value in Baltimore City is $160K compared to the state average of $290K and the Balt. County average of $250K. It's logical that the tax rate in the city is higher because of that fact; it's also logical that said higher tax rate has an inverse effect on sales price and therefore assessments.
I don't find that to be a positive or a negative either way as the real-world impact on a practical level is limited. Whether the tax rate is $1.02/$100 or $2.02/$100 doesn't change the underlying equation. A Baltimore rowhome (or a County SFH, for that matter) worth $2K a month is still going to be worth $2K a month, whether that's $1500 in mortgage + $500 in taxes or $1700 in mortgage + $300 in taxes. I'm not sure what you mean by the tax rate making it harder to "justify maintenance or rehab;" if anything, a lower property sales price reduces the upfront barriers to ownership and encourages owner-occupancy. Swaths of the city are garbage because of all sorts of factors (crime, schools, job availability, etc.), but I don't think the property tax rate is one of those factors.
The higher tax rate bites the hardest when the prices of dilapidated shells drop to near zero. In that case, every rehab and operating cost hurts the prospect for rehab. The same is true when a landlord is making the decision of whether to abandon a poorly maintained rental home vs. just abandoning it. Not paying taxes and just walking away seems to be a sound business decision in many cases.
Interestingly, many families abandon their family homes when the owner dies even though the houses have some residual value. I think this phenomenon has more to do with not wanting to go through the estate process than anything else. Therefore, lots of abandoned houses actually have some market value.
People on that block seem to pay between $1,500 and $2,500 these days. The tax take obviously hasn't kept up with inflation. In fact, the inflation adjusted value of the taxes paid has fallen by well over 50%.
People on that block seem to pay between $1,500 and $2,500 these days. The tax take obviously hasn't kept up with inflation. In fact, the inflation adjusted value of the taxes paid has fallen by well over 50%.
What you say is interesting ... and surprising.
Those houses were built in 1947. Not sure of the original price but my parents paid $11,000 in 1951. I also don't know the assessed value in '67 but the taxes were $1K.
3570 is valued at $112,900 for 1/1/16 and $102,167 for 7/1/16, per SDAT:
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