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I find that hard to believe. A quick look at Redfin says tax on this $385k home is about $564/mo [1]. In any case, the lower tax rate in CA gets baked into the

I find that hard to believe. A quick look at Redfin says tax on this $385k home is about $564/mo [1]. In any case, the lower tax rate in CA gets baked into the property value (hence the sky-high valuations) so you're paying for it either way. Comparing equivalent homes in NYC/Jersey City or Boston to those in Silicon Valley or LA makes it easy to see the effect property taxes have on valuations. [1] https://www.redfin.com/TX/Austin/2015-Ploverville-Ln-78728/home/31582786 https://www.redfin.com/TX/Austin/2015-Ploverville-Ln-78728/h...

runako 4y ago
> A quick look at Redfin says tax on this $385k home is about $564/mo The tax estimate is based on an assessment based on a sale that happened 6 years ago, which ends up valuing the house at $100k (roughly 25%) less. :-) A new buyer would have a hard time paying the same tax because this would involve successfully arguing that the property is worth $100k less than what they just paid for it. $800/mo is likely in the ballpark of what the new owner would be looking at. EDIT: Since millage rates are public, we don't have to guess. The topline Austin (Travis County) millage rage is 2.1767, so if that property were in the city of Austin its taxes on a $385k assessed value would be 8,380.29, or $698/mo. It may actually be in Pflugerville (hard to tell at a glance) where the taxes are lower due to letting Austin taxpayers pay for the big shared muni services. The other effects are interesting, but my experience living in TX is it is definitely not a low-tax state.
- ceeplusplus 4y ago
  Sure, but if you're going to compare taxes you have to compare the effect of Prop 13 on property valuations, as that's basically a tax but with the revenues going to existing property owners rather than the state. > but my experience living in TX is it is definitely not a low-tax state Dunno, I'd take property taxes (i.e. taxes on consumption of real estate) over income taxes. Particularly since income taxes are progressive whereas property taxes are a flat percentage. Even if I paid $2k/month in additional property taxes, the difference in income taxes would still make TX cheaper.
  - runako 4y ago
    Including prop 13 as a tax is extra, like including private school as a tax in places where the schools are bad. Possibly relevant to cost of living, but not a measurable tax. The killer with high property taxes is that you have to keep earning more as your property increases in value, or there is a real risk of you falling behind. Similarly if you are ever unemployed you might prefer a tax proportional to your income. Obviously this also makes retiring early even more difficult. But there’s a system to suit every need, I guess.
    - ceeplusplus 4y ago
      > The killer with high property taxes is that you have to keep earning more as your property increases in value, or there is a real risk of you falling behind That's a feature, not a bug. The entire reason California's real estate market is so dysfunctional is that people are disincentivized from selling due to Prop 13, so you have people living in oversized houses paying a tiny fraction of the property tax their neighbors are. You "falling behind" means someone else gets a fair shot at living in the area without being disadvantaged by a 10x higher property tax. Ideally the property would never increase in value in the first place, because we'd build enough housing to prevent that.
      - runako 4y ago
        >Ideally the property would never increase in value in the first place, because we'd build enough housing to prevent that. This is the key takeaway from all of my experiences reading about and owning property. We'd all be much better off if we built a ton more housing, but that doesn't fall within the Overton window and so likely will not happen.
    - robocat 4y ago
      > The killer with high property taxes is that you have to keep earning more as your property increases in value, or there is a real risk of you falling behind Not if the municipality has a fixed budget and all property values are rising in the municipality. The mill-rate changes so that you only pay more taxes if your property has gone up relatively more than other properties in your municipality. See thread here: https://news.ycombinator.com/item?id=32528916 https://news.ycombinator.com/item?id=32528916 Also if your property value has gone up, you have gained equity, so that may offset increased taxes (depending on divers factors).

runako 4y ago

> A quick look at Redfin says tax on this $385k home is about $564/mo The tax estimate is based on an assessment based on a sale that happened 6 years ago, which ends up valuing the house at $100k (roughly 25%) less. :-) A new buyer would have a hard time paying the same tax because this would involve successfully arguing that the property is worth $100k less than what they just paid for it. $800/mo is likely in the ballpark of what the new owner would be looking at. EDIT: Since millage rates are public, we don't have to guess. The topline Austin (Travis County) millage rage is 2.1767, so if that property were in the city of Austin its taxes on a $385k assessed value would be 8,380.29, or $698/mo. It may actually be in Pflugerville (hard to tell at a glance) where the taxes are lower due to letting Austin taxpayers pay for the big shared muni services. The other effects are interesting, but my experience living in TX is it is definitely not a low-tax state.

ceeplusplus 4y ago
Sure, but if you're going to compare taxes you have to compare the effect of Prop 13 on property valuations, as that's basically a tax but with the revenues going to existing property owners rather than the state. > but my experience living in TX is it is definitely not a low-tax state Dunno, I'd take property taxes (i.e. taxes on consumption of real estate) over income taxes. Particularly since income taxes are progressive whereas property taxes are a flat percentage. Even if I paid $2k/month in additional property taxes, the difference in income taxes would still make TX cheaper.
- runako 4y ago
  Including prop 13 as a tax is extra, like including private school as a tax in places where the schools are bad. Possibly relevant to cost of living, but not a measurable tax. The killer with high property taxes is that you have to keep earning more as your property increases in value, or there is a real risk of you falling behind. Similarly if you are ever unemployed you might prefer a tax proportional to your income. Obviously this also makes retiring early even more difficult. But there’s a system to suit every need, I guess.
  - ceeplusplus 4y ago
    > The killer with high property taxes is that you have to keep earning more as your property increases in value, or there is a real risk of you falling behind That's a feature, not a bug. The entire reason California's real estate market is so dysfunctional is that people are disincentivized from selling due to Prop 13, so you have people living in oversized houses paying a tiny fraction of the property tax their neighbors are. You "falling behind" means someone else gets a fair shot at living in the area without being disadvantaged by a 10x higher property tax. Ideally the property would never increase in value in the first place, because we'd build enough housing to prevent that.
    - runako 4y ago
      >Ideally the property would never increase in value in the first place, because we'd build enough housing to prevent that. This is the key takeaway from all of my experiences reading about and owning property. We'd all be much better off if we built a ton more housing, but that doesn't fall within the Overton window and so likely will not happen.
  - robocat 4y ago
    > The killer with high property taxes is that you have to keep earning more as your property increases in value, or there is a real risk of you falling behind Not if the municipality has a fixed budget and all property values are rising in the municipality. The mill-rate changes so that you only pay more taxes if your property has gone up relatively more than other properties in your municipality. See thread here: https://news.ycombinator.com/item?id=32528916 https://news.ycombinator.com/item?id=32528916 Also if your property value has gone up, you have gained equity, so that may offset increased taxes (depending on divers factors).