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My Home is Worthless!

Filed in archive Housing by Justin McHenry on May 02, 2007

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As more and more of the tax money that cities receive comes from property taxes, a strange occurrence has taken place. People are reveling in the upswings in value in their homes from the recent hot real estate market in many places. At the same time, they are trying to convince their cities that their homes are worth much less in order to pay fewer taxes:
Residents of Lee County, Fla., filed nearly 2,900 appeals for the 2006 tax year, more than triple the previous year, after assessments increased by an average of 39%. In Erie County, Ohio, 732 property owners appealed their recent assessments, where typically there are fewer than 200 appeals.

So many property owners filed appeals in Bonner County, Idaho, last year -- an estimated 2,732, vs. 100 the prior year -- that they swamped the County Board of Equalization. At one point, the board was hearing appeals every 15 minutes for 11 hours a day, during the four-week window allotted to the work. It had to request three extensions from the state and still could only absorb 16% of the caseload.

I'm not knocking the people for trying to get their homes assessed fairly. First off, if you don't appeal your tax rate, you can be sure you'll be paying more in taxes than your neighbors that DO appeal and then win a lower rate. Second, I've appealed tax hikes in two cities in two states and thus far have a 1.000 batting average. There's nothing to lose in appealing your tax rate; the worst they can do is say no.

If you've never appealed your property taxes before, the first thing to do is to see if your county has info online that shows what you and your neighbors pay. Otherwise you should be able to get this info from your county in some other form. One of our main tactics in getting our taxes lowered in the past was simply to show what our close neighbors were paying (at least those who were paying less than us), and make the case that our home shouldn't be valued so much higher than theirs.

Personally I know that paying taxes is one of our duties as citizens in order to help our cities, states and country run better, but I don't feel bad appealing my property taxes because I do believe property owners these days are paying an unfair burden taxwise. Every new school, park, library, etc. issue on the ballot is billed as "just an extra $1.75 per month on your property tax bill," which of course means $1.75 if you only have a $100,000 house and that the $1.75 per month should be multiplied by 12 to get a full year's cost and that you're already paying a ton in property taxes for every other "just $1.75" issue that's been on the ballot for the past 20 years.

And, once these issues are on the ballot, many of those voting on them are people that don't own property. Why would they vote "no" on something that won't cost them any money? (Although it will cost them when their rent goes up, they just don't think that far ahead. And to be fair their rent will probably go up regardless.)

This has turned into a rant. I should know better than to get myself started on property taxes.


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Tags: real  estate  home  finance  money  home+worthless  real+estate  personal+finance 

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