Texans actually pay more in taxes than Californians do? (Howe: loan, homes)

[oil capital]

Originally Posted by blameyourself

I don't care much about any of of that. I know no one's spending $172K on a home in our area (Williamson County). And after having my taxes increased by $4,000 over a 3-year period, I know that pace is not sustainable for many as they wait for an over 65 exemption. I've never had that happen in our California home and we will be looking at the damage when we do hit retirement age and running the numbers to see if it makes sense to have such a massive property tax bill during our retirement years (10% a year is certainly not looking very appealing with the appreciation in the Austin metroplex). Right now our taxes are over 13K on our Williamson County home and roughly 6K on our California home.

How do those homes compare?

[Need4Camaro]

Originally Posted by blameyourself

I don't care much about any of of that. I know no one's spending $172K on a home in our area (Williamson County). And after having my taxes increased by $4,000 over a 3-year period, I know that pace is not sustainable for many as they wait for an over 65 exemption. I've never had that happen in our California home and we will be looking at the damage when we do hit retirement age and running the numbers to see if it makes sense to have such a massive property tax bill during our retirement years (10% a year is certainly not looking very appealing with the appreciation in the Austin metroplex). Right now our taxes are over 13K on our Williamson County home and roughly 6K on our California home.

Overall I agree, Texas is not friendly to the elderly, especially if they are on fixed income and little to no retirement savings, and especially if they have a mortgage ontop of that.. ..I think Texas is much more friendly to young / middle aged adults who are still career orientated and are living on a standard W2. Calif income taxes and overall cost of housing makes it impossible to buy a house there living on a standard paycheck where it is still possible in Texas, (although slowly becoming a fantasy in Texas too). Young / Middle aged adults in the middle class IMO are the people who are saving the most on taxes in TX compared to more tax heavy states, especially if they are renting.

[blameyourself]

Originally Posted by oil capital

How do those homes compare?

Is this a conversation about taxes or homes? Should we talk about all the factors that go into why homes are priced as they are?

[blameyourself]

Originally Posted by Need4Camaro

Overall I agree, Texas is not friendly to the elderly, especially if they are on fixed income and little to no retirement savings, and especially if they have a mortgage ontop of that.. ..I think Texas is much more friendly to young / middle aged adults who are still career orientated and are living on a standard W2. Calif income taxes and overall cost of housing makes it impossible to buy a house there living on a standard paycheck where it is still possible in Texas, (although slowly becoming a fantasy in Texas too). Young / Middle aged adults in the middle class IMO are the people who are saving the most on taxes in TX compared to more tax heavy states, especially if they are renting.

Exactly, but if you are an established resident (the point of my comment), the benefit may not be there for that family with the exorbitant property taxes in Texas (especially if you're still a little off from retirement). The increase on our CA property is 2% vs a 10% jump in Texas. So we get an increase of $120 a year vs around $1300 in Texas. I don't know about you Camaro but I'm thinking we are all going to have some catching up to do and should be seeing 10% increases for at least the next 5 years minimum.

[Dopo]

Originally Posted by blameyourself

Exactly, but if you are an established resident (the point of my comment), the benefit may not be there for that family with the exorbitant property taxes in Texas (especially if you're still a little off from retirement). The increase on our CA property is 2% vs a 10% jump in Texas. So we get an increase of $120 a year vs around $1300 in Texas. I don't know about you Camaro but I'm thinking we are all going to have some catching up to do and should be seeing 10% increases for at least the next 5 years minimum.

People don't complain about property taxes because it's complex to figure out how much you actually pay
but the reality is that if you own a $300,000 house in Texas, you pay about $600/month in property taxes and they are goin up $60 every year.
Next year is going to be $660 and the next year $720.

But then I have to hear idiots talk about how great Texas is because we don't have state income taxes.
At least with income tax, my taxes wouldn't be going up 10% every year.

[blameyourself]

Originally Posted by Dopo

People don't complain about property taxes because it's complex to figure out how much you actually pay
but the reality is that if you own a $300,000 house in Texas, you pay about $600/month in property taxes and they are goin up $60 every year.
Next year is going to be $660 and the next year $720.

But then I have to hear idiots talk about how great Texas is because we don't have state income taxes.
At least with income tax, my taxes wouldn't be going up 10% every year.

I don't find it very complicated. I just think there are too many cheerleaders that will cut off their nose to spite their face. And lord forbid you talk about an income tax because that's taboo. In the meantime, people will be forced out by their property taxes by the time they get to retirement. Of course, there will also be those saying "don't worry about it...you can defer your property tax when you retire"...yeah, that's a great plan (especially at 5% interest). Lord forbid you have to sell your home to cover some end of life medical expenses only to find you have little equity due to property tax deferrals.

[Need4Camaro]

Well, for now I prefer property taxes to income taxes. I agree that it does not work for everyone, especially retirees... ...but for me personally I pay much less in property tax than I would in income tax if the state imposed one. Not to mention the high probability that if an income tax were to be introduced to this state, that we would end up with both, a high property tax and a moderate income tax while receiving no net gain from the system. The state already has a $50 Billion Surplus, but we aren't getting anything out of that are we? An income tax isn't going to make matters better for our lives on a social and infrastructural level.

When I retire though, I would either downgrade to a rental or move out the state.

[oil capital]

It might be time for a few "clarifications" regarding Texas property taxes after retirement (age 65).

1) When you hit age 65, you get a larger homestead exemption. This is quite substantial. My taxes dropped $3,000 per year (about a 35% reduction).

2) You are eligible to have your taxes deferred. They are deferred until you sell your home. NO TAXES have to be paid until the home is sold.

3) School property taxes (typically around 65% of your total tax bill) are frozen when you hit 65. NO INCREASES.

4) A new law that went into effect will unfreeze and lower school property taxes for seniors in certain circumstances.

5) Appraisal increases capped at 10% per year (as discussed above).

[oil capital]

Originally Posted by blameyourself

Is this a conversation about taxes or homes? Should we talk about all the factors that go into why homes are priced as they are?

It has to be about both. If you are comparing the taxes on your 5,000 square foot home with an acreage, pool and tennis court in suburban Austin with the taxes on your 1 bedroom condo in San Jose (just to throw out an exaggerated example), that context is important to the discussion of the relative tax impacts.

[blameyourself]

Originally Posted by oil capital

It has to be about both. If you are comparing the taxes on your 5,000 square foot home with an acreage, pool and tennis court in suburban Austin with the taxes on your 1 bedroom condo in San Jose (just to throw out an exaggerated example), that context is important to the discussion of the relative tax impacts.

No it doesn't and it's merely a deflection tactic. I could buy a mansion in Youngstown, Ohio right now that would be significantly bigger than our Texas home. But why would I? Housing prices are based on desirability to live somewhere and that includes a myriad of factors. If you want to have a discussion on that, feel free to start another thread and I'll be happy to engage you. But I have no intention of wasting time going down that rabbit hole and hijack this thread. It's off topic.