Fun Under the Water:

[c1ue]

Re: Fun Under the Water:

Picking myself as a random person to survey randomly, here's the stats on my neighbors based on taxes paid as a percent of county's reported values (my new neighborhood could not be more middle of the road):

2 houses due north: 1.77% (now 1.33% of their 2004 purchase price) was taxed at 2.18% of then just value in 2005 & 1.94% in 2006

my next door neighbor to the north: 1.62% (now 1.20% of 2003 price) was taxed at 1.16% of then just value 2005 & 1.36% in 2006

my neighbor to the south: 1.1% (or 1.1% of their 2001 price) was taxed at 2.3% in 2001 & at 1.2% in 2005

2 houses to the south: 2.0% (or 1.38% of their mortgage--built mcmansion on vacant lot in last year of bubble--ooops)

My question for you is: how new is your development? If it didn't exist even prior to 2005, it is likely that everyone in it has a high tax rate because they all just bought.

Or worse, they bought at the peak and now they're paying based on bubble valuations.

As a note - what a lot of people don't know is that Proposition 13 - and I'd bet most of its relatives in other states - doesn't just cap increases in property tax rates. It also preserves the 'maximum value' - i.e. even should you successfully petition to get a property valuation reduced, futures increases back to the former value are not affected by the increase cap.

I do not understand how not moving up effects housing supply. I lived in one house before and live in one now. Our portability amendment benefits up or downsizing to various degrees. I believe portability only applies to homesteaded properties, not commercial or 2nd homes but I'd have to check that.

If you believe in the residential real estate life cycle: i.e. rented apartment, to condo, to starter home, to family home, to empty nester condo - then anything which stops people from going through this cycle affects supply - both from the property and from the money recycling.

In the California Bay Area, I know a significant number of people who will never move from their existing home because a move would actually cost them much more money than the relative house price change.

Their existing property taxes are so low that just moving to an identical house next door would raise their monthly bills by $1000 or more. So instead they keep adding on rooms and levels. The result is what I call the suburban ghetto: a friend's house in Huntington Beach has a neighbor who has built out their original 2 bedroom/1 bathroom house into a 6 bedroom, 3 bathroom monstrosity that touches 3 of the 4 property lines of that plot.

Yet the property tax paid by this monster is 1/5th that of my friend's other neighbor: a person who bought the house on the other side which is the original 2 bedroom, 1 bathroom ranch home for $650,000 in 2007.

[housingcrashsurvivor]

Re: Fun Under the Water:

My question for you is: how new is your development? If it didn't exist even prior to 2005, it is likely that everyone in it has a high tax rate because they all just bought.

Or worse, they bought at the peak and now they're paying based on bubble valuations.

As a note - what a lot of people don't know is that Proposition 13 - and I'd bet most of its relatives in other states - doesn't just cap increases in property tax rates. It also preserves the 'maximum value' - i.e. even should you successfully petition to get a property valuation reduced, futures increases back to the former value are not affected by the increase cap.

Taking another break. Social work exam at 6. Will get to rest of your response on return.

I've never been a development dweller. Not real into samesville. (same setbacks, same rooflines, same colors, no thank you.)My last home, perfect for my 30s & 40s was a few blocks from a downtown with an active nightlife. This one in lower cost area is right near one of the country's largest universities with lots of medical facilites for my 60s thru 90s. Immediate area mostly developed in 1950s from old orange groves to unusually large lots so I've got about an intown acre where I enjoy gardening.

The taxes rates shown above are as reported, the percent currently charged on the market value as currently determined by the county. Also shown are their rates now as a percent of their purchase price (dates given) and also I showed what rate they were charged when they purchased.

SOH value only has any value when prices go up, not down. When prices come down below the purchase price, then the homes are taxed at the current market value (assuming they got it right--likely not, but there you have it). If prices come down, but they are still above the original purchase price, then even though prices are coming down, taxes go up at that 3% level until the SOH value rises to match the declining market value.

I've spreadsheeted most houses in my neighborhood so I have easy reference as to what sold when. Will check some longer-held homes now and see what that gets (showing date purchased, homestead status, current tax paid as percent of county's current market value appraisal, current tax as percent of original price):

1998, homesteaded, 1.41%, 1.78
1981, homesteaded, 1.69, 1.63*
1995, homesteaded, 1.41, 1.82

*changed hands within family in 2001 so prob was reappraised at that time with new basis set. many of these properties here stay in the families. I am only the first owner outside of the original family on mine.

Sorry, but getting pretty much the same numbers. Gotta get to class. Laterzzzzz.

Think I ace'd my test. Woohoo!

Just checked another totally selected at random. Here's an older building (circa 1976/77) on Hallandale Beach in Broward County where I thought I'd find some long-term residents.

http://maps.google.com/maps?f=q&sour...50.9,,0,-22.44

And here are Broward County Property Appraiser Records showing info as I did above...

http://www.bcpa.net/RecInfo.asp?URL_Folio=514226CJ0010

1992, homesteaded, 1.35%, 1.53

http://www.bcpa.net/RecInfo.asp?URL_Folio=514226CJ0030

1989, nonhomesteaded, 2.23, 3.11

http://www.bcpa.net/RecInfo.asp?URL_Folio=514226CJ0090

1976, nonhomesteaded, 2.2, 6.39*

*yikes. Good example of the protection of homestead and SOH.

And that's without any datamining. The Boca condo reported above is a building familiar to me but I did select units totally at random. With this one all I did was find a condo on google maps, pop in the condo name here http://www.bcpa.net/RecSub.asp and then I just went down the list starting at the top and picking the first three units sold before year 2000 and still in those owners' hands.

Here's another building up in Daytona. Also total random google map selection.

http://maps.google.com/maps?f=q&sour...7.13,,0,-15.47

here's Volusia County Prop Appraiser records on it

Parcel ID 2715330804 Plug that here http://webserver.vcgov.org/Parcel_search.html gives these units selected as I did the Hallandale one...

HORN JACQUELINE B
1994, homesteaded (2010-12-03 $2,630.95) just value 163,982 original price 140,000 so 1.6%, 1.88%.

Ack, have to hit too many web pages but I think the idea is clear. Same as the others.

[housingcrashsurvivor]

Re: Fun Under the Water:

If you believe in the residential real estate life cycle: i.e. rented apartment, to condo, to starter home, to family home, to empty nester condo - then anything which stops people from going through this cycle affects supply - both from the property and from the money recycling.

In the California Bay Area, I know a significant number of people who will never move from their existing home because a move would actually cost them much more money than the relative house price change.

Their existing property taxes are so low that just moving to an identical house next door would raise their monthly bills by $1000 or more. So instead they keep adding on rooms and levels. The result is what I call the suburban ghetto: a friend's house in Huntington Beach has a neighbor who has built out their original 2 bedroom/1 bathroom house into a 6 bedroom, 3 bathroom monstrosity that touches 3 of the 4 property lines of that plot.

Yet the property tax paid by this monster is 1/5th that of my friend's other neighbor: a person who bought the house on the other side which is the original 2 bedroom, 1 bathroom ranch home for $650,000 in 2007.

Interesting. Was not familiar with cycle. My cycle was rent and save until I had good down payment. Get into serious construction accident. Lose my savings. Go back to school. Start new career. Continue renting and saving. Finally buy a house to live in. Later sell and buy a different one, go back to school, start new career (I call it a downsize because price per sq ft is less but I've actually got more beds/baths as I intend to let at least one room for income & company).

I hope not many go through my cycle and I don't know of anyone who has gone thru the one you describe. I can't think of any but a few of my friends who are not still in their "starter" homes (a tag I dislike as I think it a marketing "feel bad" tool) or who simply did just a lateral move.

The scenerio your describe of being stuck in a home is precisely what happened in Florida until we got portability of our SOH values. Even downsizing would have produced much higher taxes. As luck would have it, however, that portability did not kick in until Hurricane Wilma and the coincidental bubble burst kicked values (both market & SOH) out from under us. The market turned off like a water faucet. And so even with portability, people were stuck again in their homes. This has been a nightmare.

[c1ue]

Re: Fun Under the Water:

HCS,

I think I see the problem.

You're taking the assessed value and comparing with the tax paid. (BTW, the assessor's web page for Broward county is a great resource, thanks for the pointer)

However, when I 'Zillowed the properties above, I got very different valuations:

1912 S OCEAN DRIVE 1-2A, Hallandale Beach, FL

This property paid $3,375,50 in taxes in 2010, but is for sale for $439,000 (listed 13 days ago) = 0.77% tax

It was previously listed at $449,000 but the history only goes back a couple years for this property on Zillow.

The other 3 properties are all similar condos next to the first.

The Zestimates are much lower, $200K-ish (and 2003 level), but the history for the other properties shows valuations over $400K (and over $600K in the case of 1-4A)in the 2005 to 2007 time frame. It seems clear someone - likely the real estate broker - intervened with the Zillow history for the property for sale.

Depending on how assessments work in Broward County, Florida, it would not surprise me that the assessments made are higher than expected market prices - unless challenged. This is because assessments are by nature backward looking, and in your (and your neighbors') case, you are being penalized for the previous Florida real estate valuation bubble.

Note that the Census data is from 2008 - thus prices would have been fairly close to peak and the percentages are wholly consistent with the example above.

So I'd have to say your anecdote based disagreement with the Census data - at least based on the comps you posted above - is flawed.

[don]

Re: Fun Under the Water:

The RE-FIRE Cycle:

You rent? At your age? Don't you want to own your own home . . . .

Nice starter home. You can do a lot with it. Don't go overboard, remember its just a starter home. Paint, maybe re-do that bathroom. I have a brother-in-law that can set title, He's reasonable . . .

A brand new track house! Congratulations! Feels good to be in a brand new house, doesn't it. This is a great way to someday move up to a custom . . . .

debtdebtdebtdebtdebtdebtdebtfeesfeesfeesfeesfeesin terestinterestinterestinterest

[housingcrashsurvivor]

Re: Fun Under the Water:

My starter home was blocks away from the drug rehab center (later torn down for townhouses). I got involved with the town right away and over time we cleaned the place up. Ten years later our little area became so popular as to be featured on a NY Times front page (below the fold, but still pretty cool). A little starter home, in a little starter area. You'd be surprised what a little paint can do.

C1, You're welcomed for the website. I thought I was just kidding earlier when I joked about their values coming from zillow. If the problem is that I'm using the real numbers, then I've no issue with that problem.

http://www.bcpa.net/RecInfo.asp?URL_Folio=514226CJ0010 shows the sales history on that 400k joke of an asking price. $86k when first built in 1976, sold for 222,500 in 1985 and then for 220k in 1992. It is a ground floor unit and since most go into condos thinking safety, probably it will not be the first to sell. Also people go into condos on the beach for the view and you don't see much down there. Likely it will fetch less than other recent sales.

The county's just value is $250,820. (I've found these county appraisals to be about 10-20% low, not high, and I believe they try to keep their accessments below true market value so that they do not get contested. The current county assessment on my new place is about 20% under what I paid (and by what this place ought to be worth based on rent to price ratio, they're about --oh my, that's embarrassing, well, never mind.) Moving on, the last place I sold is current appraised by that county at 27% under the price I got for it.)

The lastest sales in this building include the penthouse (at a number that looks odd)

http://www.bcpa.net/RecInfo.asp?URL_Folio=514226CJ0730 $1,325,000 or $505/sq ft (you'd have to convince me that there was any way in hell something in Hallandale is worth that, particularly in this building). That one is currently appraised at 795,770 on which it is taxed $17,222 or 2.16% but will probably be taxed nearer the sales price as of January when the new figures are reported in June. Figure taxes closer to $24,000 in that case.

The more typical recent (within year) sales in that building include

http://www.bcpa.net/RecInfo.asp?URL_Folio=514226CJ0450 $280,000 taxed at $3,558 or 1.27%

http://www.bcpa.net/RecInfo.asp?URL_Folio=514226CJ0060 $250,000 taxed at $5228 or 2.1%

http://www.bcpa.net/RecInfo.asp?URL_Folio=514226CJ0700 $279,000 taxed at $5574 or 2%

2008 was hardly peak, South Florida peaked in 2005, though many show 2006. I tried selling an income property right after Wilma at the end of 2005, kept my price 10-20% below all comps and it took me two years. Nice place. Would have gone in a day six months earlier. The market had turned off like someone turned a spicket. By 2008? forgetaboutit, you could smell the carcasses rotting.

[aaron]

Re: Fun Under the Water:

Every dollar that you do not spend in taxes is a dollar available to pay your bankster.