Property taxes > Mortgage

13 Replies

My property taxes are now 76% of my mortgage. Last year we had a double digit increase, and almost double digit again this year. This is not only a direct attack on investors, but also retirees and other people on fixed incomes. This also forces rents up, and adds to the homeless situations throughout our nation.

We need to take a stand and expose the waste of our cities, and how technical colleges harvest off of us also. What kind of legal action can we take??? Property taxes should never be more than 30% of a mortgage, and especially not 76%.

@Aaron K.

You should examine your holistic taxes paid across the whole spectrum (income, sales, property, etc) before you make a determination how friendly or unfriendly an area is.

It's generally accepted that when a state reduces (or eliminates) taxes on one revenue source they must raise taxes on another revenue source to compensate.  E.g. many states with no individual income tax often have much higher property taxes and sales taxes than average.

So while it's great that Prop 13 may tie your state and local government's hands on property taxes, it's not stopping the state from charging $800 per year on each and every LLC doing business in CA, regardless of revenue or net income, or setting the state's top marginal individual income tax rate at 13.3%.

@Casey Rouse

I recommend you work with a company that specializes in property tax abatement to get most of the increase removed or even completely eliminated.

If you can demonstrate that your property has not increased in FMV year-over-year, you have more of an argument.

@Casey Rouse   First question is how much are your mortgage payments and the taxes?  If you have a $1000 mortgage every month, based on what you said where taxes are 75% of the mortgage payments, you're property taxes would be $9K per year which is really high.

Did you submit an appeal to the city?

@Casey Rouse

"We need protections from being overtaxed."

You are the protection.  You are the one standing in-between them and your bank account.

If you really wanted to, you could organize, petition, and work through your state and local legislative process to change your property tax laws...with the realization that this is a very low value activity if you ever eventually succeed.  Or, you could treat this as a business problem, not a moral duty, and follow my suggestion in the previous post.

@Eamonn McElroy I think we are making essentially the same point that the states aren't as different as they may seem at first.  Everyone likes to hate on CA for high taxes but ignore prop 13, everyone likes to applaud TX for no state income tax but you don't see a ton of complaints about 2.7%+ property taxes.  I have done the math and prop 13 has been pretty good all things considered.  It also goes to the OP's point that it helps seniors as well who have owned their homes for long periods of time.

Property taxes on 2 of my properties in St. Louis Co just went up 25% a piece - both were $4400 last year, $5500 this year. Neither of them I can protest because 1 of them I haven't yet closed on, and the PO didn't protest, and the other one I closed on it the day after they sent the notice of assessment to the PO....which he promptly trashed. 

Talking to the county assessor about it was less fun than smashing my head against a wall, I may as well have been speaking another language. I can't protest them now til 2021. I like to think my taxes are being used for good purposes, it's what keeps me sane LOL.

FWIW, coming from Texas my property taxes were on par with the taxes here in Missouri, a state that taxes income. Then the personal property tax. MO has their pie, they get to eat it, and come back for seconds and thirds. 

Still, I'm glad I'm not in California, and I'm especially glad I'm not paying taxes in Australia (home country), England, Europe...etc.

I love living in the USofA, and I will happily (mostly) continue paying my fair share. The only other thing you've got to look forward to is dying at some point.

We have a lot of properties with this disparity. Fighting it has been a waste of time & as soon as you clean up a place, get a permit for rehab the assessor jumps in. Back in 2005 we got a zombie home at the Tax Lien auction, run down & vacant for 5 years. We installed the required new siding, new roof & rehabbed the inside. The assessment on closing was $28k as were all the other homes in the street. After rehab the assessment jumped to $80k & we fought it without success so we sold it, held the note & the assessment has since increased again & taxes are way higher than the mortgage payments. The neighboring homes in their original condition are now assessed in the $40's.

In nearby Erie county 80% of property taxes go to cover those on Medicaid, the rest is wasted, so get used to it.

This is why I’m transitioning to owner financing . Let somebody else deal with taxes insurance and repairs . I just want the mailbox money without the headaches 

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