how to build any future on 115k salary here? (San Mateo: apartment, rent)

[readuntil]

> Prop 13 safety valve is that property (with a few exceptions) is reassessed
> to market value upon voluntary transfer (nearly always based on the sales
> price)

When I ask how prop 13 works, I actually mean to find out how the state functions without the lost revenue. As someone pointed out, the roads are not paved as often, indicating a loss of city and state services. But the state still mostly functions, and on a whopping $120 billion, so what I wonder is how. Is it because personal income tax rates have risen since the advent of prop 13? Does anyone have statistics? I find the 9.3% tax on dividends, capital gains, and interest to be akin to highway robbery -- but maybe it's needed to offset lost tax revenue elsewhere.

As for the 10.3% tax bracket, here it is: Proposition 63 "Mental Health Services Expansion, Funding. Tax on Personal Incomes above $1 Million
State of California" (November 2004). If this passed, it essentially means there is a 10.3% tax bracket. 6,183,119 / 53.7% Yes votes ...... 5,330,052 / 46.3% No votes -- but I read somewhere that tax increases requires a 66% vote, so I'm not sure if this one is in effect. But reading at the background at <http://www.igs.berkeley.edu/library/htProp63MentalHealthServicesExpansion.htm> says that counties must provide the services but are unable to do so, most likely because property taxes are too low. It's only the new homes that generate oversized tax revenues.

Anyway, prop. 13 should be amended to modify the annual rate of increase from 2% to the rate of inflation or zero, whichever is larger.

[Kingsnkali]

I don't understand the logic of Prop 13 impacting road construction and other state costs. Do roads cost more to pave/repair/plow snow etc. in California than Arizona, Michigan, Minnesota, Florida etc?

Should our road repairs cost DOUBLE what other states pay just because our home valuations are DOUBLE the US average here in California???

If you look at the average property tax bill in California and compare it with other states, you will see that we are not undertaxed even with Prop 13.

As a longer term owner, my California property taxes under Prop 13 still go up each year. There is also enough churn or turnover in properties statewide to assure an increasing revenue stream for the state as the properties are reevaluated each time they sell.

California property taxes just don't shoot up for the home owner like some states based on the whims of the market (New Jersey etc.) That form of taxation is a recipe for wiping out people. You force them out of their home because they simply can't afford the onerous property tax bill increases. And how are those people supposed to retire on much less income and still stay in their home???

California does it right with Prop 13. It's the other money-grubbing states that overuse property taxes and do it wrong. We Californians pay plenty of income taxes, high sales taxes and very high gasoline taxes on top of our property taxes. The state gets plenty of money out of our hides.

[Tallysmom]

Originally Posted by Kingsnkali

I don't understand the logic of Prop 13 impacting road construction and other state costs. Do roads cost more to pave/repair/plow snow etc. in California than Arizona, Michigan, Minnesota, Florida etc?

Should our road repairs cost DOUBLE what other states pay just because our home valuations are DOUBLE the US average here in California???

Not double -- but more, yes. Our home values affect everything. Our home values mean in order to afford housing, we have to pay higher wages across the board. Higher wages means higher costs -- for food, gas, utilities....

We just live in higher cost of living area.

There is one thing you are right on -- some cities are poorer than others. I live in one of those cities. (I'm the one who hasn't had her road paved in over 20 years) There's lots of reasons, one of which is this was known as a renter city, with little turnover in property and so taxes were kept low. Thanks to Jerry Brown, we got lots of homes built and we should see some serious money flow into the city coffers so they can fix up stuff.... and they have been, but just not here... yet.

[guymanwoman]

I'm sorry $115K is about £70000 at the current exchange rate. Are you kidding me?!! I live in London and you can get by very well with that kind of money. Are you a ridiculously poor spender or something. London is a bloody sight more expensive than San Fran so I cannot empathise with you. You're a fool

[mayorhaggar]

^
that will show those people from four years ago, right on brother.

[rascal-c]

It is really interesting to read this thread though, pre-recession crash...

[sliverbox]

Wow. Indeed it is. I read back at the beginning and people were saying I was nuts to think housing prices would fall- which they did.

[soya]

I think being 27 and earning 115k is pretty good. Also when you are married and if your wife also works, she will also add up to the collective income of the family.

But again, I see that you are spending too much. I used to live in Belmont till 2006 and I paid only $1100 for rent and that too was not reasonable as you could get cheaper places as well.

Some of the posts have already suggested how to cut down. If you follow most of them you would have things in control. Savings take a lot of patience and time, but in the end it is worth it. Also, there is no end to it. Once you have kids, you would want to buy a home for them, when they grow bigger, you would want to save for their college education and then for your retirement. So make saving a part of your life style, not a one time race. That also means, dont deprive yourself of the things that makes you happy.. keep them inexpensive..... because if you go too frugal, you wont be able to keep up..
All the best!! I and my husband are doing pretty well on similar salaries... we like to eat out a lot, so we did not cut down on that.. but we dont go to super expensive places... just regular ones...

[Tallysmom]

Originally Posted by sliverbox

Wow. Indeed it is. I read back at the beginning and people were saying I was nuts to think housing prices would fall- which they did.

I was one of them, and I've eaten my words. In fact, in my not good neighborhood, our values fell around 80%..... which I had no idea would happen.

I am still in the cat bird seat though. My mortgage is WAY low.... and easily affordable....so even if I am "lapping at the water's edge" I'm only tossing 442 bucks into the ocean....

Health insurance on the other hand....

[jpatlanta]

Originally Posted by guymanwoman

I'm sorry $115K is about £70000 at the current exchange rate. Are you kidding me?!! I live in London and you can get by very well with that kind of money. Are you a ridiculously poor spender or something. London is a bloody sight more expensive than San Fran so I cannot empathise with you. You're a fool

Well we made 115k pounds as a couple with 1 child and just left London, we couldn't afford anything other than a 1 bed flat in an area populated by 3rd world immigrants on that money.

There is no way you can live in 70k in London unless you are single and want to live like a student in a bed sit all your life. For the same income SF has a much better standard of living and lower taxes.

However London property is now dropping so it may be more affordable in the future..................