Date registered: Apr 2004
Location: The BlueGrass State
Mentioned: 0 Post(s)
Quoted: 2 Post(s)
I think the biggest thing to help the market will be for communities to start limiting their building permits until the thresholds of houses on the market is reduced.
My cousin is a PVA here in Kentucky and we just had a conversation about what happens when housing values diminish which in turn SHOULD cause the taxable value of houses to reduce. If that happens, and you know people will take the PVA to court on their 2007/8 assessments to have them reduced to meet market reductions, then municipal tax bases start reducing.
Her response, the rates will simply go up to address the difference since cities won't suck up the reduction of tax revenue. THEN, when prices go back up, see how hard it is to get that rate reduced again.
Property values decline
Property owners sue to have tax assessments reduced
Tax base reduced based on lower revenues from lower assessments
Cities raise tax rates to meet deficit
Property values increase over time
Tax assessments go back up
Cities then have higher tax rates AND higher assessments.
Yet another way we will all get hosed because regulators didn't do their job.
Being smart is knowing the difference, in a sticky situation between a well delivered anecdote and a well delivered antidote - bear.