Quote of the Day: Taxes and Home Values
"When you buy a house, you’re not just committing to a mortgage. You are also promising to pay the future property taxes on that house. What drives those local property taxes are the future costs of paying state and local workers and retirees, particularly retirees’ pensions and health care. These costs are going in one direction: up.
Unless state and local governments take steps now to reduce future costs, or unless they plan on suddenly repudiating their promises to their public-sector work forces one day, every dollar in unfunded pension and health-care costs is up to a dollar less in the future value of a house."
~Nicole Gelinas, NRO article "How Taxes Drive Down Home Values"
HT: NCPA
23 Comments:
All public pensions, from police to school teachers to federal employees and soldiers, need to eliminated.
Let those employees, hired at taxpayer expense, fund their own, voluntary pension plans.
Otherwise taxpayers will face time bombs.
Yeah pseudo benny, you know how to stay on topic...
Juandos-
Thanks for noticing me down there in St. Louis. You should be nice to me.
You stole away my Los Angeles Rams. And what did I get back?
"You stole away my Los Angeles Rams. And what did I get back?"...
You want them back?
If it was up to me that boat load of sissies would've been gone five years ago...
Does everybody still disagree with me that the 30-year mortgage and deduction are subsidizing future tax payers? People wonder why, with all the push, we can't get beyond the home-ownership rates we have. Maybe it's because only 45% of people pay fed tax and have no incentive (ability take the deductions).
Sorry, I meant 45% DON'T pay...
"Does everybody still disagree with me that the 30-year mortgage and deduction are subsidizing future tax payers"...
Well I don't agree with you mike...
Home mortgage deduction can be argued that it steals from future taxpayers...
Juandos-
They may be a boat load of sissies, but they make the LA Fakers look like a band of douche-bags.
Actually, professional sports are nothing more than regional monopolies, and they act like it, from player to owner.
"Actually, professional sports are nothing more than regional monopolies, and they act like it, from player to owner"...
Well mmaybe but if you feel that way you can always vote with your wallet...
Housing prices are down 30% or so in many big cities, and mortgage rates are the lowest in modern history.
And Nicole Gelinas still finds something to whine about. It is hardly news that everybody would prefer to pay less in taxes. Come to think of it, everybody would prefer to pay less for everything they buy.
Juandos,
Then would you say that this topic is a non-story? If the home mortgage deduction steals from taxpayers, and the local taxes are deductible, then this is a gain for the home-owner and one would be foolish to buy their home outright or choose a shorter term.
Aside from taxation, I don't think there's much argument about the gains in home-related business that are seen by having more home owners rather than less. For example, I'm about to drop 20k on a remodel job that wouldn't be done if I was renting...or if I didn't have the extra money from deductions. It seems like all I ever do is dump money into this place and only part is maintenance.
Are you factoring this 'money scattering', along with the additional sales taxes, in your opinion?
Come to think of it, everybody would prefer to pay less for everything they buy.
Agreed. I would especially like to pay a lot less for things I'm forced to buy at gunpoint - like ever more government, for instance.
That's just residential real estate. Since commercial real estate is valued according to net income, each additional dollar of property tax is 8-10 dollars in reduced property value.
"Then would you say that this topic is a non-story? If the home mortgage deduction steals from taxpayers, and the local taxes are deductible, then this is a gain for the home-owner and one would be foolish to buy their home outright or choose a shorter term"...
No mike I wouldn't say that exactly...
Basically I'm saying that there's no free lunch esepcially nowadays...
Our supposed "public servants" are actually the public masters of us tax serf who are forced to pay tribute every year to keep what we have worked a life time for; to finance their cozy jobs with lavish benefits. Even when we serfs are jobless,disabled, or have no income.
The IRS is a paragon of fairness compared to your local county Tax Mafia.With no income no taxes are required by the IRS.
The County Tax Mafia however, requires ever increasing taxes from its victims even those with no income. All to fund, in many cases, the bloated, self serving,greedy "public servants" who regard their privileged status as a divine right.
"Mafia" is an apt comparison.
Anyone with a Kindle may be interested in spending $5 to find out about an unpublicized chapter of the Great Depression where local governments resorted to hiking property taxes due to a massive loss in revenue.
Taxpayers in Revolt: Tax Resistance During the Great Depression
I would caution readers that Beito does not really account for the effect of the passage of the 21st Amendment on local revenues. The tax revolts ended because when alcohol became legal the local and state governments discovered a new source of revenue that filled local coffers even as consumers of alcohol saw their costs decline substantially. The big losers were the mobsters.
There could be a lesson here for the statists in the next administration. One way to offset falling revenues would be to legalize and tax drugs. Users would benefit from cheaper higher quality goods while the governments would get more revenue and reduce costs of law enforcement, prisons, etc. Most people win while the criminals lose.
What Nicawawa said.
For anyone who doesn't think there is a wealth tax in the United States, what is a property tax but a wealth tax?
Juandos,
I agree that there's no free lunch...that's not what I'm trying to say. I'll revisit this when I can explain my thoughts better. What I'm thinking is more complicated than my ability to verbalize clearly without numbers.
"I'll revisit this when I can explain my thoughts better"...
O.K. mike, looking forward to what you have to say...
Mike: "If the home mortgage deduction steals from taxpayers, and the local taxes are deductible, then this is a gain for the home-owner and one would be foolish to buy their home outright or choose a shorter term"..."
The home mortgage deduction is a subsidy for homeowners that encourages borrowing. I don't know that I'd call it "stealing" from taxpayers, as most renters have a renters credit they can claim, so basically there's a tax credit for living somewhere, and most people do.
Although the tax deduction is nice icing on the cake for those with a home mortgage, depending on your marginal tax bracket, it's hard to understand why people think paying $3-$4 in interest to a lender to get back $1 from the IRS is a good deal.
V: "
Taxpayers in Revolt: Tax Resistance During the Great Depression"
Also available free as an epub for those platforms that support them.
, it's hard to understand why people think paying $3-$4 in interest to a lender to get back $1 from the IRS is a good deal.
+++++++++??+??++++++++
You really are an idiot. What is the alternative? Saving for 25 years at 0.5% interest, on top of your rental cost, and no IRS refund?
While you landlord takes the interest deduction, and pays capital gains on the appreciation, after deducting all his expenses?
You really are an idiot. What is the alternative?
When it makes more sense to rent that is what you do.
Saving for 25 years at 0.5% interest, on top of your rental cost, and no IRS refund?
You mean that you do not know that you can invest in stocks, trusts, commodities, commercial real estate, and all kinds of other assets?
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