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Homestead exemption and property tax

Thumping said:
Thats not how property assessment is supposed to work. Just because your neighbor prices their house for 2x's what its worth and a dumbass from out of state buys, somehow your property is now worth 2xs?
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YES... That's how it works.

The guy paying 2X set the value used for the comps.

Now most states have a restriction on how much they can take at a bite, so you have a cap on how much your taxes can go up, but the value is set based on what someone, even a jerk form out of state, is willing to pay. (in Texas it's a cap of 3.5% on the annual tax rate increase).
 
Thumping said:
Thats not how property assessment is supposed to work. Just because your neighbor prices their house for 2x's what its worth and a dumbass from out of state buys, somehow your property is now worth 2xs and taxed accordingly?
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it's worth whatever some damn fool will pay for it.
 
Thumping said:
Thats not how property assessment is supposed to work. Just because your neighbor prices their house for 2x's what its worth and a dumbass from out of state buys, somehow your property is now worth 2xs and taxed accordingly?
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I can't think of any land here that the tax value is near the real value.

My old place was taxed around 225k, i sold it for 340k.

This place, the tax value is about 220k less.

I looked at the neighboring land, it's 60 acres i think. Taxed at 100k.

I talked with the owner about buying a section... wants $475k for 14 acres 😬
 
Projectjunkie said:
I heard that if you do the paperwork to bury your dead spouse on the land you get a cemetery exemption from taxes.
I guess you and the lady gotta rock paper scissors for it
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Go get you a dead hooker. Doesn't need to be a spouse. Then you have an exemption for 24sq. ft (3' X 8') . Go party.
 
Thumping said:
Thats not how property assessment is supposed to work. Just because your neighbor prices their house for 2x's what its worth and a dumbass from out of state buys, somehow your property is now worth 2xs and taxed accordingly?
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tax man will always use the most favorable "comp" to extort money.
owner will always use the lead favorable "comp" to defend against said extorsion.
 
bgaidan said:
So you paid X for it and they've assessed it for less than that and you're confused as to why? If you paid that much for it, it's clearly worth that much and that's what it will be assessed at. What part of the confuses you?
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A long time ago when I lived in Pennsylvania, my dad explained to me the Assessed value is not market value. He said it should approximate the value 20 years prior. (If it was the same, ie 1500 sq ft house) That way, it is not based on market fluctuations. It made sense because everybody’s value was considerably less than current market. My dad was not prone to BS. Not sure where he got that. Have any of you heard of such? I’ve never heard of someone’s property being assessed at market, but mine is pretty close at this point.
 
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AKnate said:
I can't think of any land here that the tax value is near the real value.

My old place was taxed around 225k, i sold it for 340k.

This place, the tax value is about 220k less.

I looked at the neighboring land, it's 60 acres i think. Taxed at 100k.

I talked with the owner about buying a section... wants $475k for 14 acres 😬
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A section is 640 acres.
 
What you are missing is that any time a property is sold the property tax assessor can account for the stepped up basis of the value. So just because Fred Jones, who owned the property for the last 30+ years was paying a property tax that was artificially held down due to various caps doesn't mean that the new owner (who paid a whole lot more $ than Fred did 30 years ago) is going to get that same assessed value. They will get a new assessed value that is more aligned to current market prices. You helped set that new market value since you were willing to pay that much.

I've experienced this myself. When my father passed away in 2007, I inherited the property on a lake in the Tampa area. I had been living there for almost seven years and paying the property tax, which was around $3K. When I transferred the property to my name (I was executor), they county took the opportunity to reset the basis (my parents bought the property in the 1950's) and the next year my property tax was $10K....

As far as your idea to claim two homestead exemptions, that will only work if you are actually divorced.
 
WaterH said:
.......He said it should approximate the value 20 years prior. (If it was the same, ie 1500 sq ft house) That way, it is not based on market fluctuations. It made sense because everybody’s value was considerably less than current market....
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He lied to you.

Not saying he was BSing, but misinformed.



Where I get confused is I believe that the assessed value is the beginning number. Now you get your homestead exemption, so take 40k off that value (or whatever the number is in your state) and then you get the number they tax. But the homestead may be applied at different values to different things. Like you may get a different homestead value break from the school district, than you do for the city in some states).

Edit:

OK... I had it fucked up

The assessed value is the Market value with the Exemptions backed out.




Screenshot 2024-08-01 111726 1 of 2.jpg

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It was prop 13 that kept California property taxes down and now as a parting gift on my way out the door they tag on prop 19.
 
Texas is capped at less than 10% per year.

Unless you challenge it then they can raise it more.

Now the 0.37 per $100 value makes more sense when they say it’s only a 0.02 bump in property tax… lying to sell the bond.
 
WaterH said:
I’ve never heard of someone’s property being assessed at market, but mine is pretty close at this point.
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Just be glad you aren't here.

I bought my house for less than assessed value. Went to the tax office and asked to have my taxes lowered.

by law they only do it every 3 years so No, they can't and won't decrease my taxes.

On the 3 year mark (2 years after I purchased) I went back and asked again, they said they re-assessed it at the retail price, then used county market details to show values had gone up by xx% and they placed me over the prior assessed value, so by leaving it the same they 'Did me a favor'.

The tax man should die.
 
Kyle said:
Texas is capped at less than 10% per year.

Unless you challenge it then they can raise it more.

Now the 0.37 per $100 value makes more sense when they say it’s only a 0.02 bump in property tax… lying to sell the bond.
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It's under 3.5% unless your area took disasters relief money. Houston is about to get hammered, because the disaster relief loophole in the cap is going to let the city hammer their asses.

gov.texas.gov

Governor Abbott Signs Pivotal Property Tax Reforms Into Law

gov.texas.gov gov.texas.gov



www.newsweek.com

Texas homeowners facing tax hike after storms

Harris County commissioners are reportedly taking advantage of a loophole in state law to raise property taxes by 8 percent without voter approval.
www.newsweek.com www.newsweek.com
 
WaterH said:
A long time ago when I lived in Pennsylvania, my dad explained to me the Assessed value is not market value. He said it should approximate the value 20 years prior. (If it was the same, ie 1500 sq ft house) That way, it is not based on market fluctuations. It made sense because everybody’s value was considerably less than current market. My dad was not prone to BS. Not sure where he got that. Have any of you heard of such? I’ve never heard of someone’s property being assessed at market, but mine is pretty close at this point.
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Your dad was wrong. It's going to vary drastically from state to state. Where I live, it's state law the a county must reassess at least every 8 years, or when the average sales to assessed values get out of whack by a certain percentage. They don't/can't do an automatic increase based on sale value here so I got to ride the previous assessed value for a few years. They did a reassessment for the whole county for this tax year and my value went up over $400k partly based on what I paid in '21 and partly based on the overall increase in the market.

Some states will allow them to immediately change the assessed value after a real estate sale and it will generally be close to what the property actually sold for.


Kyle said:
Texas is capped at less than 10% per year.

Unless you challenge it then they can raise it more.

Now the 0.37 per $100 value makes more sense when they say it’s only a 0.02 bump in property tax… lying to sell the bond.
Click to expand...

I believe TX is one of the states that will use a purchase price as the new assessed value for a new sale. The max % change is for a year to year change where there's been no change in ownership. I remember getting fucked on that in Tarrant county. I appealed and went in front of the board and was very quickly denied. :mad3:

Honestly, that kind of fucks over new buyers as they could be paying much, much more on an identical property until the legacy properties catch up.
What just happened here with the reassessment was values almost across the board increased by something like 40-50% from 7 years ago. People lost their fucking minds because they're retarded and don't have a clue how assessed values and property taxes work. They base the tax rate off the total cumulative property value. For simplicity - say the amount of money needed to run the county is the exact same from year to year. If every property value across the county went up exactly 50%, they would reduce the tax rate to bring in the same amount of $$ as last year so you'd be paying the exact same. Where you can get fucked and where I was getting fucked is if your value goes up more than the average. One of my properties was like 85% and the other was in the 60's. I appealed and actually lucked out and met the appraiser when he came by to review the property. I sold him my pitch on why they were wrong and he really worked with me to get the value down on both parcels. I'll still be paying a bit more, but not nearly as much as I would have.
 
WaterH said:
A long time ago when I lived in Pennsylvania, my dad explained to me the Assessed value is not market value. He said it should approximate the value 20 years prior. (If it was the same, ie 1500 sq ft house) That way, it is not based on market fluctuations. It made sense because everybody’s value was considerably less than current market. My dad was not prone to BS. Not sure where he got that. Have any of you heard of such? I’ve never heard of someone’s property being assessed at market, but mine is pretty close at this point.
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Now we know where you got your smarts.
 
Yes, pretty sure its spot on that way ~ -> Calif.


WaterH said:
A long time ago when I lived in Pennsylvania, my dad explained to me the Assessed value is not market value. He said it should approximate the value 20 years prior. (If it was the same, ie 1500 sq ft house) That way, it is not based on market fluctuations. It made sense because everybody’s value was considerably less than current market. My dad was not prone to BS. Not sure where he got that. Have any of you heard of such? I’ve never heard of someone’s property being assessed at market, but mine is pretty close at this point.
Click to expand...
 
Assessments and appraisals are both processes that determine the value of a property, but they have different purposes and methods and can vary significantly depending on many factors.

Assessments: are a local government's estimate of a property's value, performed on a mass scale without interior inspection. Assessments are used to calculate property taxes and are based on sales comparison data and cost estimates.

Appraisals: are performed by a professional state licensed appraiser's determination of a property's market value, based on many factors including location, square footage, and construction materials and other external factors. Appraisals are often required by lenders when considering mortgages or certain dollar amounts. Appraisals are more thorough evaluations than assessments and the determination of market value. Appraisals are the typical method of appealing assessed values.

Market Value Definition – Uniform Standards of Professional Appraisal Practice

“Market Value means the most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition are the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: 1. Buyer and seller are typically motivated; 2. Both parties are well informed or well advised, and acting in what they consider their own best interest; 3. A reasonable time is allowed for exposure in the open market; 4. Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and 5. The price represents the normal consideration for the property sold unaffected by special or creative financing or sale concessions granted by someone associated with the sale.”
 
Even if the assessment goes up your taxes shouldn't, the budget it the budget not what they can get from you.

I have a rental South of OP I get to pay $4-600 increase every year, then they brag all the permits for new build they approve, I would think with a bigger tax base rates would go down, but fuck no they the government inefficientcy is all they know.

The $500/ yr for ditch management really pisses me off ,can't get them to clean the swamp of a ditch I have out front that sinks the mower cause it does not hold standing water 72 house after a storm, but the street floods with 12 hours of rain
 
bgaidan said:
So you paid X for it and they've assessed it for less than that and you're confused as to why? If you paid that much for it, it's clearly worth that much and that's what it will be assessed at. What part of the confuses you?
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Property is rarely assessed at its actual value. They have all sorts of screwy math to come up with tax amounts.
 
Ransil said:
Even if the assessment goes up your taxes shouldn't, the budget it the budget not what they can get from you.

I have a rental South of OP I get to pay $4-600 increase every year, then they brag all the permits for new build they approve, I would think with a bigger tax base rates would go down, but fuck no they the government inefficientcy is all they know.

The $500/ yr for ditch management really pisses me off ,can't get them to clean the swamp of a ditch I have out front that sinks the mower cause it does not hold standing water 72 house after a storm, but the street floods with 12 hours of rain
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400-600 INCREASE every year? 😳😳
 
WaterH said:
A long time ago when I lived in Pennsylvania, my dad explained to me the Assessed value is not market value. He said it should approximate the value 20 years prior. (If it was the same, ie 1500 sq ft house) That way, it is not based on market fluctuations. It made sense because everybody’s value was considerably less than current market. My dad was not prone to BS. Not sure where he got that. Have any of you heard of such? I’ve never heard of someone’s property being assessed at market, but mine is pretty close at this point.
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Inflation is a bitch
 
bdkw1 said:
Property is rarely assessed at its actual value. They have all sorts of screwy math to come up with tax amounts.
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*varies greatly by location

In my state, the assessment is supposed to be the market value at the time of the assessment. That value stays the same until the next assessment so obviously it's only likely closely accurate the first year.
 
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