What's Up with the Property Taxes?

[fnh]

I'm always, always baffled that anyone believes they are not paying property taxes as a renter. Every landlord rolls it into the rental price.

Seriously, EVERY landlord.

And, they are deducting them as a cost of doing business.

[JL]

i'm paying $,6240 in prop tax this year for a $245k home with homestead included. I'm not 65yrs old. If you're 65, it would be so much less. I used to have my mother on as primary deed before she passed and i was paying a little aroundr $3,300k when my home was $215k

[resonator]

The 65+ deal is important to me as well. Hope it holds.

Covid and who knows what is next will continue to suppress commerce related tax income. Property taxes have to go up, especially in places with unfunded pension obligations.

[Hopeful for Life]

Originally Posted by mojo101

i know my friends always complain Houston property tax is too high,a friend of mine lived in the city for many years,he paid $25 to have his lawn cut,25 years later he is still paying $25 and he has a huge backyard.
His excuse is 'I am not stupid,thats what everyone is paying in my neighborhood'
You wonder why your tax is too high,may be give your handyman a raise

Do you REALLY believe that the handyman/ yard man actually reports anything that you are paying him?

[detachable arm]

Property taxes depends on where you come from. If you are a typical bagger from flyoverville then you’ll think the taxes are high. If you come from the upper east coast or west coast or even Chicago you’ll welcome the lower taxes.

I know in the northeast not only do you get 6% state income tax but you may also get city income tax and also a nice 3% property tax on top of that, with home values being double vs here (or higher). I think Chicago is almost at this level too.

As for the west coast the 1% property tax sounds nice but even a 60k income is taxed at almost 10%.

Then there is Texas. But where are you gonna go to escape taxes and raise your family?... Arkansas? Ohio?

[fnh]

Marginal tax rates. Marginal tax rates. Marginal tax rates.

On the west coast (where I'll presume PP means California) the total income tax on $60K income would be ~$2,500, not $6K. Or, approximately equivalent to the tax owed on $80K of Texas property valuation at 3%.

It is difficult to directly compare tax burdens across locales as so much depends on variables of an individual's particular situation (income, property, consumption patterns). Many take it as an article of faith that state income taxes are more burdensome than local sales and property taxes, but that is frequently not the case at all.

And, people regularly dismiss the importance of getting something in return for their money. Many people don't mind paying more in taxes because they live in more desirable places with better public services.

[tstone]

Originally Posted by detachable arm

I know in the northeast not only do you get 6% state income tax but you may also get city income tax and also a nice 3% property tax on top of that, with home values being double vs here (or higher). I think Chicago is almost at this level too.

This is about right for PA. You get a state 3.1% + municipal 1-4% on top of it, depending on which city/borough you lived in. Flat tax.

Property taxes were all over the place. Some boroughs you could get a ramshackle $100k house but have a 5-6% property tax every year. Where I lived property values were about double Houston burbs (but with 2x more land). The tax rates were similar which meant your property taxes were essentially double. However they poured a ton of money into education (avg. teacher made about $90k). I'm sure tons more were poured into union wages, too.

Another thing, if you go to sell your house you had to pay a 2-5% real estate transfer tax to the state & municipality.

With that aside, don't forget higher fuel taxes, which inflated the cost of everything else.

Texas isn't exactly a "tax haven" but it might strike the best balance between high income job availability & tax burden. You can also mitigate property taxes further by choosing a modest neighborhood.

[citidata18]

Originally Posted by fnh

I'm always, always baffled that anyone believes they are not paying property taxes as a renter. Every landlord rolls it into the rental price.

Seriously, EVERY landlord.

And, they are deducting them as a cost of doing business.

The point is, even if landlords are passing along property tax increases to the renter, the fact that Texas has some of the highest property taxes in the country definitely hasn't translated into much of a difference in rents relative to what you pay in other states with considerably lower property taxes.

Median 1-bedroom apartment rents:

Dallas - $1,375/month
Houston - $1,269/month

Atlanta - $1,590/month
Phoenix - $1,171/month
Charlotte - $1,330/month

https://www.businessinsider.com/cost...exas-is-1375-4

[Ivory Lee Spurlock]

Originally Posted by citidata18

Not if you're renting.

The cost of the property taxes are passed on to the renters. Good luck finding a nice one bedroom/bathroom in a middle class apartment complex in a middle class area for less than $950 a month. $950 is high rent if the total household income is less than $60,000 (before taxes) a year. The rent will continue to increase each year as property taxes increase. I'd guess close to $200 per month of rent is to cover property taxes. There's no escaping property taxes or getting around them if you're going to live in Austin, unless you're a homeless/jobless panhandler living on the street. Otherwise it will cost you a pretty penny to live in Austin. That's just a fact of life.

[citidata18]

Originally Posted by Ivory Lee Spurlock

The cost of the property taxes are passed on to the renters. Good luck finding a nice one bedroom/bathroom in a middle class apartment complex in a middle class area for less than $950 a month. $950 is high rent if the total household income is less than $60,000 (before taxes) a year. The rent will continue to increase each year as property taxes increase. I'd guess close to $200 per month of rent is to cover property taxes. There's no escaping property taxes or getting around them if you're going to live in Austin, unless you're a homeless/jobless panhandler living on the street. Otherwise it will cost you a pretty penny to live in Austin. That's just a fact of life.

There's not even a way to quantify how a landlord's property taxes going up increases the rent a tenant pays, because so many other variables besides taxes go into determining rental prices. Even you admit it yourself by saying "I'd guess." For anyone to say otherwise is not being truthful.

The fact that Austin's dominant industry attracts a ton of professional workers making well over 6-figures has a lot more to do with how quickly the rents are rising there than any property tax increases.

And frankly, Austin is a aberration compared to the other big Texas cities because the state average rent is $200 below the national average despite the high property taxes. And as posted above, rents in Dallas and Houston are still in line with the rents in other sunbelt cities where the property taxes are much lower.