D&D and the rising pandemic

[Zardnaar]

I'm all for keeping folks in their houses in their senior years - or to stop families from being removed at younger ages due to gentrification, or to stop ancestral land from being lost because of increasing value!

Unfortunately, I think, a lot of the plans I hear around here for doing that seem more like they're designed to help folks who just don't want to pay taxes but still want to reap all the profits when they sell. So, I wonder about doing something like giving people a choice on how they want the tax changes to be done - either (a) as usual (regular reappraisals with a % increase limit), or (b) deferred to something like the next time the house is sold to someone outside the family. So, if the senior wants the house to be sold when they die to give their kids a huge amount of money (either they or the kids selling), then they should pay the increased taxes on it as they go. If they don't care if it's passed on, then they don't ever have them increase, and maybe the house goes to the city to be sold to recoup those taxes when they pass away. That avoids the things where if you just have the older generation get a fixed tax rate forever, then the younger generations and those who had to move for some reason pay for all of the public services. (In a place where property taxes do that, anyway).

Are taxes calculated on the value of the property?

Contributing factor here is the local councils keep rates low and there's no capital gains tax.

If you bought in the 90's for 100-200k and sell now for 1.5-2 million it's tax free.

The rates paid to the local council do go up but successive councils have kept them as low as possible while racking up debt.

The government has put togather a 2.5 billion dollar bailout but is looking at merging things.

So you have large sections with old villas on them built pre 1940's within walking distance of the CBD now worth millions of dollars. Population has increased 60%bsince 1980 or so but they haven't really built any new infrastructure since then either at least in terms of what's needed.

Ney result some areas have century+ old pipes which break a lot. One council got overruled by central government and they sidelined them with appointed officials to run the city (at huge expense the city pays for).

Of course the various councils like gumming up the works for development, virtually no one votes in local body elections (10% turnout iirc).

I had a friend who's father was tied in with the local business roundtables. Essentially they picked the major basically by going "well boys who wants to run this time".

So basically deregulation in 80's combined with unsustainable population growth = big mess.

My younger D&D players basically said they're screwed and ones a medical student and doctors aren't exactly poor.

One person was asking for advice on where/how to buy with a 150k deposit. He needed 40% deposit and there's virtually no where you can buy at 350k.

Of course if you have a spare 3 million dollars (or 30) you can visit in December, get residency in January and gain access to healthcare by March.

 

[Cadence]

Are taxes calculated on the value of the property?

It varies from state to state (and by locale within some states). In SC it's based on the value of the property if you just purchased it. Every 5 or 10 (?) years it is reassessed based on similar nearby properties. The amount of reassessment has a limit (15%?). Property taxes pay for all the local things - school, city (fire, police, trash), county, parks, etc... Well, it used to pay for the schools but then iirc they put in a 1% sales tax on everything (well, not houses or expensive cars) that makes up for it).

Contributing factor here is the local councils keep rates low and there's no capital gains tax.

Each city/district/county here sets their own, although the state keeps wanting to take that power away. Capital gains is federal (and in some states affects state taxes).

 

[J.Quondam]

It just nuts. I wish housing was just considered "homes" instead of "investment". That attitude on the part of policy-makers (and I guess the interests that own them) is killing society for regular folks. I mean so many people now have literally no hope of getting in or moving on or whatever they aspire to, even if they do everything "right."
It's just nuts.

 

[Cadence]

It just nuts. I wish housing was just considered "homes" instead of "investment". That attitude on the part of policy-makers (and I guess the interests that own them) is killing society for regular folks. I mean so many people now have literally no hope of getting in or moving on or whatever they aspire to, even if they do everything "right."
It's just nuts.

When it was horrible after WWII the government went out and set up a program to build houses for the returning veterans (didn't they do similar for educating them and providing them healthcare?).

 

[Zardnaar]

When it was horrible after WWII the government went out and set up a program to build houses for the returning veterans (didn't they do similar for educating them and providing them healthcare?).

Yeah and the schools were in better condition.

It was the first time the hoi polloi got to enter university en masse.

 

[Zardnaar]

It varies from state to state (and by locale within some states). In SC it's based on the value of the property if you just purchased it. Every 5 or 10 (?) years it is reassessed based on similar nearby properties. The amount of reassessment has a limit (15%?). Property taxes pay for all the local things - school, city (fire, police, trash), county, parks, etc... Well, it used to pay for the schools but then iirc they put in a 1% sales tax on everything (well, not houses or expensive cars) that makes up for it).


Each city/district/county here sets their own, although the state keeps wanting to take that power away. Capital gains is federal (and in some states affects state taxes).

Most things here are central government funding.

Your rates pay for things like water, trash collection, parks, council owned assets, utilities, corporate welfare I mean stadium etc.

 

[Eltab]

Yes, this is the type of thing that really burns me. There should be laws that they can never make you pay more in property tax than what your mortgage payments were....ever.

IT's terrible for those on retirement incomes and fixed incomes. You buy a home hoping to have it into your senior years, and then you end up paying more on a fixed income in property taxes than you were paying on it's mortgage when you were working.

I like the policy that 'the taxable value of your house is the price you bought it for'. Because in Indiana, after the voters put a property tax rate cap into the State Constitution, assessed property values started climbing - just about as fast as the rates had used to be rising.

 

[Cadence]

I like the policy that 'the taxable value of your house is the price you bought it for'. Because in Indiana, after the voters put a property tax rate cap into the State Constitution, assessed property values started climbing - just about as fast as the rates had used to be rising.

I'm not sure what the benefit is of having the young new home owners and people who move paying for everything. [Edit: I can see saving the elderly, but why those in the peak of their earning years?] Could that even essentially trap people in their houses since the new house (that might be equal in value to what they got from selling their last, long time owned one) would have vastly higher property taxes since they bought it for the new higher price?

 

[Zardnaar]

Well the growth this quarter has slowed from 29% to only 18%. It mean it takes 4 years for your house to double in value instead of 2.5. last year it was 26%.

Only 4.3 growth rate a month instead of 6.6%. Won't somebody feel for the mom and pop investors!!!!.

House price growth eases across all major regions

House price growth has eased for the third month in a row suggesting efforts to cool the market may be working.

www.rnz.co.nz

That's not an annual rate but monthly. Last quarter only 8.9% gains in three months.

Average price was only $952000. All you have to do is save a 200000+ deposit by age 25, 30 year mortgage and then 10 years to save to retirement.

Perfectly reasonable it's only just under $650000 usd get cracking.

 

[Eltab]

I'm not sure what the benefit is of having the young new home owners and people who move paying for everything. [Edit: I can see saving the elderly, but why those in the peak of their earning years?] Could that even essentially trap people in their houses since the new house (that might be equal in value to what they got from selling their last, long time owned one) would have vastly higher property taxes since they bought it for the new higher price?

You seem to think that property taxes stop coming when the mortgage is paid off? I do not understand something in your background assumptions.