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As people and money rolled in, taxes went up....A LOT! The tax collector saw every house as a McMansion and taxed it as such. We were paying $18K, as I recall when I took over those matters, for a very simple house.
You've just described why property taxes - a form of wealth tax - ought to be banned. Yes, municipalities need revenue to cover municipal services such as police, fire, schools, roads, and other basic services, but a property tax is a terrible way of raising that revenue because of all manner of negative characteristics.
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We all want government services, and of course we have to pay for them. The question remains, what is a good way to pay for government services that doesn't have bad consequences and impart economic distortions? Property taxes fail the test.
Let's take a hypothetical. Let's say we have a municipality with 100,000 houses, each identical, each valued at the same dollar amount - let's say it is $500,000 just to pick a number - and the owners of each house pay the same tax rate - let's say it is 1% just to pick a number. Thus, each homeowner pays 1% of $500,000 each year, or $5,000 per year. Because there are 100,000 houses, we multiply that by $5,000 per year and the municipal government gets $500,000,000 to pay for governmental services such as police & fire & education and the like.
Problem #1: some of those houses have just one person living in it, while others have two, and others have three or four or 10. Why should the homeowner of just one resident pay the same for police & fire & roads as the homeowner with 10 residents? The use of government services such as a fire department, roads, law enforcement, ambulance etc is a function of the number of people, not the number of houses nor the property value.
Problem #2: let's say someone from elsewhere such as California wishes to move into our hypothetical municipality. He drives around and sees there are no homes for sale. Remember, all homes are identical and all valued at $500,000. But he REALLY wants to move here. So he knocks on someone's door and say, "I'll offer you $600,000 if you will sell me the house." He is turned down, so he goes door-to-door asking and finally finds someone who sells him a house for $600,000. Now, each of these houses are identical, so magically, the county assessor says "everyone's house is now worth $600,000, and each house now owes property taxes of $6,000."
Why should everyone's property tax go up in my hypothetical just because one person sells a house to an out-of-state buyer in my example? The municipality did nothing to deserve it, the community's demand for governmental services has not changed whatsoever, yet the municipality now extracts $600,000,000 of tax revenue. Does that municipality refund the unneeded revenue? No. Does the municipality "bank" the excess funds?" No. Is the municipal government a good steward of the public's money? No. Instead, as surely as the sun rises in the east and sets in the west, the municipal government permanently will increase its spending: it magically finds uses for this windfall of money.
Problem #3: this is a bit more abstract. Because property taxes tax unrealized hypothetical wealth appreciation, it opens the door to the "let's tax unrealized gains in the stock market and bond market" argument, together with the unrealized gains in the value of other assets such as fine art, jewelry, precious metals, 1960s muscle cars, 401K plans, IRAs, Roth equivalents, etc.
We need to nip wealth taxes in the bud. We need to fund government, but not via wealth taxes.
Part of the issue with the Alabama/Mississippi/Louisiana coasts are going to be the direct hurricane impact. The western coast of FL is rarely impacted by hurricanes. It seems Alabama/Mississippi/Louisiana get pounded every other year or so. Healthcare is likely an issue. Amenities are probably an issue if you're coming from a wealthier state.
You've just described why property taxes - a form of wealth tax - ought to be banned. Yes, municipalities need revenue to cover municipal services such as police, fire, schools, roads, and other basic services, but a property tax is a terrible way of raising that revenue because of all manner of negative characteristics.
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We all want government services, ........
NO, we all don't want government services.
Long story short and in relation to our thread here, I am a firm believer that not having high speed, unlimited, broadband Internet in an area is what keeps people out and when it does come (because people are addicted to it and can't live without it), THERE GOES THE NEIGHBORHOOD!
Internet makes it attractive to others who move in and then, they want everything they had in the city. More services, more frills, more taxes.
...Maybe Louisiana, Mississippi and Alabama coasts in the Gulf are still affordable. Not states people seem to be running to just yet though...
Maybe. IMO, there are excellent reasons why people aren't running to those places yet, or possibly ever. I'd replace "warm" with "hot", for starters.
The aforementioned Hilo, Hawaii is not cheap anymore, unfortunately. It could be affordable for many, however.
It's true that there are very beautiful and relatively unpopulated coastal areas in cold climates.
Yakutat, Alaska is one of them and it's known for decent surfing. Never mind the 140+ inches of rain and 185 inches of snow they receive on average per year.
Maybe. IMO, there are excellent reasons why people aren't running to those places yet, or possibly ever. I'd replace "warm" with "hot", for starters.
The aforementioned Hilo, Hawaii is not cheap anymore, unfortunately. It could be affordable for many, however.
It's true that there are very beautiful and relatively unpopulated coastal areas in cold climates.
Yakutat, Alaska is one of them and it's known for decent surfing. Never mind the 140+ inches of rain and 185 inches of snow they receive on average per year.
The protection of the right of your ownership of your property is a government provided service. It is the local government that enforces property rights, preventing someone else from just coming on to your property and building houses.
If someone were to wander on to your property and break ground on houses, you would rightly scream "Get Off My Land," perhaps brandishing your trusty .50 caliber Sharps-Borchardt Model 1878 to make your point (in my mind's eye, you own & are quite proficient with a buffalo rifle), but recognize the enforcement of property rights is a legitimate government service. Otherwise, that nasty property-right-ignoring developer would just show up with an airforce of drones piloted from a safe distance & bomb you out of existence.
The rule of law is a legitimate government function.
Part of the issue with the Alabama/Mississippi/Louisiana coasts are going to be the direct hurricane impact. The western coast of FL is rarely impacted by hurricanes. It seems Alabama/Mississippi/Louisiana get pounded every other year or so. Healthcare is likely an issue. Amenities are probably an issue if you're coming from a wealthier state.
Alabama coast used to be affordable. Medical and amenities are there.
I prefer cold coastal environments...they may or may not be cheap, but fewer obnoxious people and the problems
they drag along with them tend to congregate there. Remember what Sartre wrote: "Hell is other people."
Personally, I don't need to dabble a single toe in that frigid water to enjoy it's presence.
Agreed! I'd enjoy temps in the 50s or 60s, a brisk breeze, and big waves crashing on rocks.
Then, after walking for awhile, coming inside and fixing a mug of hot chocolate or a bowl of soup.
I think the trend nobody is thinking about will start taking place in about ten years when we've stopped having a housing shortage and started having a housing glut. All those baby boomers who are downsizing or dying will be propelling a housing glut. It's already baked into the demographics.
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Originally Posted by ChileSauceCritic
You are correct, in about 10 - 15 years older boomers will start dying off in large numbers and there will be more homes and apartments than people to fill them and as a result housing prices will plumet
I keep seeing this sentiment being expressed in places but the math doesn't seem to validate it. In say 10 years time frame baby boomers will free up about 10 million homes of the roughly 32 million they own. For the next 3 generations to hit the same level of home ownership as the generation ahead of them did (at the same age) they need about 25 million homes on the low end. That doesn't seem like a housing glut type situation.
If anything it would be a housing glut in some very particular markets like AZ or FL while shortages develop in places where millennials and gen z are looking to buy. I see at best an opportunity for Gen Xers to buy into baby boomer dominated markets for their retirement home. Which is kinda related to the topic of this post I suppose.
On that point, There are a ton of very affordable and safe locations around the world with warm climates and excellent health care systems, begging for funded retirees to move in.
I would look at the Lost Coast near Petrolia. It's pretty inexpensive over there. In Petrolia, there are a ton of cult so beware of that.
There's a reason they call it the Lost Coast. No road access to the beach for 30 miles. There's quite literally nothing there, and with regulation of the coast, there probably never will be. It's beautiful though. I have a very fond memories of backpacking there and sleeping on the windswept beach.
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