3 ms·

my single family home went up 40% in market value during Covid. More property tax should be great for local govt coffers, right? Wrong! Now local govt is cash

my single family home went up 40% in market value during Covid. More property tax should be great for local govt coffers, right? Wrong! Now local govt is cash strapped again. So we have new ballot measures for providing kids with meals, but only from taxes on those making $300k+ annually. Where is the money going? Meanwhile, the number of vehicles that need mufflers is increasing. It's audible. That is a reliable sign of economic distress. Nobody can buy a house without a down payment and reasonable job security. The economic gulf widens.

jschveibinz 1y ago
Benefits are the cause of increased cost in school systems: https://reason.org/commentary/administrative-bloat-isnt-the-biggest-problem-facing-school-district-budgets/ https://reason.org/commentary/administrative-bloat-isnt-the-... Benefits are likely affecting municipal government in the same way.
- thatfrenchguy 1y ago
  Really a market shaping failure by the federal government here.
RandomBacon 1y ago
> More property tax should be great for local govt coffers, right? Wrong! Their costs probably went up too.
jerlam 1y ago
You don't really want inelastic goods such as homes (land value), food, electricity, or gas to go up in value. Those things factor into the cost of everything else, so the net result is that everything just costs more for the exact same experience.
BosStartup 1y ago
It's not correct that an increase in home value increases your property tax. The town has a budget which then it divides by the sum of all property values, this gives a ratio that is the tax rate per property value. In theory, your property went up 40%, if everyone else's did too then your taxes remain the same. You can see this by viewing the tax rate over time and seeing that it has declined (but again, that didn't lower the dollar amount you must pay, just the ratio of tax to property value.)
- jerlam 1y ago
  Calculation of property taxes are different across jurisdictions, you are talking like your rules apply to every system in the world. I believe in the poster's jurisdiction, property taxes are based on a percentage of the property value and are independent of the city's actual budget.
  - Mars008 1y ago
    That value is usually calculated from last sale plus no more than some small percentage each year. I.e. if home 'went up in value' but didn't sell tax doesn't change much.

jschveibinz 1y ago

Benefits are the cause of increased cost in school systems: https://reason.org/commentary/administrative-bloat-isnt-the-biggest-problem-facing-school-district-budgets/ https://reason.org/commentary/administrative-bloat-isnt-the-... Benefits are likely affecting municipal government in the same way.

thatfrenchguy 1y ago
Really a market shaping failure by the federal government here.

RandomBacon 1y ago

> More property tax should be great for local govt coffers, right? Wrong! Their costs probably went up too.

jerlam 1y ago

You don't really want inelastic goods such as homes (land value), food, electricity, or gas to go up in value. Those things factor into the cost of everything else, so the net result is that everything just costs more for the exact same experience.

BosStartup 1y ago

It's not correct that an increase in home value increases your property tax. The town has a budget which then it divides by the sum of all property values, this gives a ratio that is the tax rate per property value. In theory, your property went up 40%, if everyone else's did too then your taxes remain the same. You can see this by viewing the tax rate over time and seeing that it has declined (but again, that didn't lower the dollar amount you must pay, just the ratio of tax to property value.)

jerlam 1y ago
Calculation of property taxes are different across jurisdictions, you are talking like your rules apply to every system in the world. I believe in the poster's jurisdiction, property taxes are based on a percentage of the property value and are independent of the city's actual budget.
- Mars008 1y ago
  That value is usually calculated from last sale plus no more than some small percentage each year. I.e. if home 'went up in value' but didn't sell tax doesn't change much.