Tax Assesments - The next ripple effect?

Question

As property values go down, how great of an impact will the ripple effects be on the Cities, Counties, and Schools what were budgeting based on the property value assessments?

C Folland · Answer

Now that lenders in Miami are labeling even the nice areas as "distressed" and then only lending up to 60% ltv, sales prices are going to keep going lower.  Property taxes are going to have to come down to make the properties viable investments.

Tony L. · Answer

Generally speaking tax assessments in the past have been lower than the market value of a property.  In many of the counties assessments are done every other year with a percentage cap that limit Big Government.  But lets say an areas property values go down significantly.  A property owner can at anytime ask for a reassessment of their property and in many cases the assessment is lowered.  Happens all the time in my home state.

Lynn Z · Answer

We recently passed reassessment at point of sale and this is discouraging investors from buying.  Because property taxes are so high anyhow it is a deal breaker for many.

Our tax assessor would die before he'd drop property taxes.

C Folland · Answer

Tax assessed values are creeping down here in Miami, but the only major changes are if you can show that you purchased a property for appraised value, and not a foreclosure.

Shari Posey · Answer

Several CA counties are lowering property taxes. In CA, when you buy a house, your taxes don't go up unless you remodel or put on an addition. Anyway, I have seen reassessments 15% below their initial tax value (ie--their purchaes price during the peak of the boom). For example, I know one person who purchased their house for $739,000 in 2006 and their new tax rate is based on $622,000.

Michael Shadow · Answer

I doubt the counties will re-asses any taxes until the market has recovered.  They would be silly to lower their tax income by doing that.

Our municipalities are already strapped because they didn't have budgeted in for fuel cost to rise this past year by 50%.

-Michael