Property taxes: how do you cope? (rent, tenant, school)

[Ghost Town]

Originally Posted by Lowexpectations

The rule is if you buy a home with the homestead you get the benefit the rest of the year, if you buy a house without you don't get it until the next year. Whatever thread you are referring to is incorrect

Thanks. Originally I also thought it should start in 2016.

[KathrynAragon]

Originally Posted by Trainwreck20

There are many times when rental properties can have negative cash flow. A landlord writes off the losses, as much as possible, and counts on long-term appreciation and a return to a profitable market.

I understand that but that is the exception to the rule. The vast majority of the time, landlords MAKE MONEY. The only way a landlord makes money is to pass on the costs of the property to the renters. Property taxes are a cost that is passed on to the renter WHENEVER POSSIBLE which is most of the time. Of course there are exceptions to every rule, but a professional landlord is in the business to make a profit and usually does so.

[KathrynAragon]

Originally Posted by Lowexpectations

Well that's certainly not true however we weren't discussing if landlords stay in the business



This is simply not true. It's certainly isn't how the rental market prices what rents the market will allow




This is true but doesn't change the fact that the market dictates rental rates

So let me get this straight. Do you honestly believe that most landlords are losing money on their investments?

I understand that occasionally a landlord doesn't make a profit on a property. But MOST landlords make money on MOST of their properties. I'm not talking about exceptions to this rule - I'm talking about general business practices and outcomes.

[Lowexpectations]

Originally Posted by KathrynAragon

So let me get this straight. Do you honestly believe that most landlords are losing money on their investments?

There is nothing to get straight as I never claimed what you are questioning

I understand that occasionally a landlord doesn't make a profit on a property. But MOST landlords make money on MOST of their properties. I'm not talking about exceptions to this rule - I'm talking about general business practices and outcomes.

We aren't talking about making or losing money for most. We are discussing rental pricing and you don't get to price based on your cost because the rental market sets the pricing and doesn't take into account your specific cost

[Lowexpectations]

Originally Posted by KathrynAragon

I understand that but that is the exception to the rule. The vast majority of the time, landlords MAKE MONEY. The only way a landlord makes money is to pass on the costs of the property to the renters. Property taxes are a cost that is passed on to the renter WHENEVER POSSIBLE which is most of the time. Of course there are exceptions to every rule, but a professional landlord is in the business to make a profit and usually does so.

You are forgetting a fundamental rule that the market sets the price not your own cost to own

[StealthRabbit]

Originally Posted by KathrynAragon

Hold up - please don't tell me that landlords in general are willing to take a loss or break even in their business. I know that's not true.

Landlords in general are in the business to make money - and that's OK.

I'm not so sure you know much about property investments vs, cash flows to cover expenses, and how PROPERTY TAX (the SOLE topic of this thread), may account for a portion of the above.

Leave it to each owner / business manager to determine how he/she allocates expenses to tenants, but SUPRISE, not all owners transfer ALL PROPERTY TAXes (across several states) to each and every tenant, the minute the state, county, or schools place the burden on the PROPERTY OWNER. Many tenants cannot absorb these extra costs. So a 1/2 intelligent owner. (1000x dumber than U, of course). Will choose to allocation PROPERTY TAX obligations to rents, only as market rates / existing tenants can afford.

An NO, not all landlords make money on rents. There are many reasons to hold different classes of investments, not all cash flow, not all come out in the black. 101, for the 'unlearned', but revolutionary to the 'enlightened'.

TX property taxes require special treatment / planning for income and for personal properties. Thousands of retirees and poor are forced from TX and other high property taxed states, as the have been for 50+ yrs.

[toosie]

Thank you, StealthRabbit, for bringing the discussion back to the purpose of the thread. There's a renting forum for anyone who wants to pursue rental pricing basis. Please stick to the OP here - Texas property taxes.

[Lowexpectations]

Originally Posted by StealthRabbit

TX property taxes require special treatment / planning for income and for personal properties. Thousands of retirees and poor are forced from TX and other high property taxed states, as the have been for 50+ yrs.

Are there areas of the state that don't allow for an over 65 exemption? I know the folks across the street from me pay 3k a year in taxes and I pay 12k and their property is worth more

[StealthRabbit]

Below are many options,

but for 'seniors':TX EXEMPTION is ONLY set to a CEILING the yr BEFORE you turn age 65, it is very likely your taxes have been climbing more than your wages / budget for the last 20 yrs BEFORE age 65)

1) good luck making it to age 65, some of us do not get the option of working much past age 50 (some professions are capped at age 42)
2) Not all are eligible (Only FT residents, I am 'somewhere', but will never be a FT TX resident (NEVER 183 days / yr in any ONE state / country).

Exemptions:
DCAD - Exemptions

Other options for deal with TX Property taxes:
1) increase your income
2) live in a beater mobile home
3) live in a more tax friendly CAD (even varies a lot within a District)

[KathrynAragon]

Originally Posted by StealthRabbit

I'm not so sure you know much about property investments vs, cash flows to cover expenses, and how PROPERTY TAX (the SOLE topic of this thread), may account for a portion of the above.

Leave it to each owner / business manager to determine how he/she allocates expenses to tenants, but SUPRISE, not all owners transfer ALL PROPERTY TAXes (across several states) to each and every tenant, the minute the state, county, or schools place the burden on the PROPERTY OWNER. Many tenants cannot absorb these extra costs. So a 1/2 intelligent owner. (1000x dumber than U, of course). Will choose to allocation PROPERTY TAX obligations to rents, only as market rates / existing tenants can afford.

An NO, not all landlords make money on rents. There are many reasons to hold different classes of investments, not all cash flow, not all come out in the black. 101, for the 'unlearned', but revolutionary to the 'enlightened'.

TX property taxes require special treatment / planning for income and for personal properties. Thousands of retirees and poor are forced from TX and other high property taxed states, as the have been for 50+ yrs.

My sole point (and what I said over and over again) was that landlords are in the business to make a profit. Much of that profit comes from rent. Generally speaking, as property taxes go up, it is reflected in rental prices. This works because property taxes tend to rise across the board in an area, and rents will creep up as the cost property taxes increases.

And yes, I understand that there are many reasons to invest in properties that may be rented out, and that there are many other ways to make money from investment property (other than rent prices). But GENERALLY SPEAKING (a phrase I've used repeatedly in this conversation), as property taxes increase in an area, so do rent prices - because yes, most of the time (not all of the time, but most of the time) landlords who own a range of rental properties factor in their total costs - including but not limited to property taxes - into the equation of what their rent should be.

That doesn't negate that the market sets the price. The market also sets the "price" for property taxes, which are part of the cost of investment rental properties.

Finally, I didn't say that "all landlords make money on rents." What I said was that landlords are in the investment property business to make a profit. There's a difference, and I'm aware of that difference.