  Ocean2026 Member Username: Ocean2026 Post Number: 139 Registered: 11-2008 |
As you can see from many threads in here, even if you buy a house cheap -say for $5000 you could easily be paying $5000 per year as the assessment could be many times the market value. This discourages investment. If prospective buyers were guaranteed the tax assessment would be at what they paid ( as long as it was arm's length ie not dad selling to son, brother etc) more people might buy. If Tax records were available free and easily like in other cities that would help too. | ||
Novine Member Username: Novine Post Number: 1227 Registered: 07-2007 |
I'm not going to defend those communities that over-assess properties. But such a system would be easy to abuse and you would end up with people engaging in all kinds of shady practices to reap the benefit of a lower assessment. | ||
Ocean2026 Member Username: Ocean2026 Post Number: 140 Registered: 11-2008 |
There will always be abuse, but a real estate contract from a licensed broker or something similar could be required as well as a copy of the original advertised price. Say that was $100,000 and then the buyer claims he paid $5000, obviously the assessors should have some leaway. The problem is without such a system many houses which look like bargains and need to be bought and both fixed up and added to the tax rolls will say unsold and continue to deteriorate. How do I know? Well I live in an avg tax state which is MUCH lower than Detroit. There is a building or two I would consider but the taxes could be HUGE and so I am so hesitant. I have talked to others who feel like me. People,especially investors, hate uncertainty ( you can see that from the stock market). | ||
Novine Member Username: Novine Post Number: 1228 Registered: 07-2007 |
Let's say that every house in the city was reassessed down to $5,000. What's going to happen to the tax rate when the tax base gets reduced by 3/4s of its current amount? Is the city going to lay off 3/4s of the police and fire or sell of 3/4s of its assets? | ||
Ocean2026 Member Username: Ocean2026 Post Number: 141 Registered: 11-2008 |
novine - Is every house in Detroit only worth $5000? Market value is defined as an arm's length transaction and the price a willing buyer and willing seller agree on. So if I see a house listed at $75k and offer $45k and the seller isn't my brother etc that's market value. The alternative is these houses stay vacant and decay. The city still has to provide services to the area and for that they receive 0, zilch, nothing. Novine - maybe you haven't noticed it but the tax base will continue to decline- Detroit is on the road to Hell. I'm trying to offer a detour in the hopes some new investors may come join the journey. Where has the current system gotten us? | ||
Goose Member Username: Goose Post Number: 107 Registered: 02-2005 |
cities aren't interested in knowing the "true cash value" of the properties they are assessing, they want the value that fits their arbitrary, narrow scope parameters for determining a value.... after being at several board of review meeting this year, as compared to previous years, the absolute absurdity of some of the assessments and the guidelines in selecting only specific allowable comparables to protest your value is rediculous.... i don't understand how the people serving on the board sit there with a straight face and will turn down a true market appraisal prepared by a state certified appraiser because the comps selected didn't fit their narrow parameters..... and these people are typically "real estate" professionals, sales agents and brokers, who sure as hell know that actual values don't reflect the minus 5-10% "gift" the assessor allowed on some peoples new assessments.... if the SEV were truely based on actual market value (which they are supposed to be), most cities would be in a world of hurt... there needs to be a better way.... | ||
Ocean2026 Member Username: Ocean2026 Post Number: 142 Registered: 11-2008 |
Bottom line -Detroit needs to attract investment and it won't unless potential investors know they aren't going to be fleeced by arbitrary assessments. | ||
Gralr Member Username: Gralr Post Number: 80 Registered: 12-2008 |
Isn't is kinda like the bail outs? Let the chips fall where they may. The city needs people like us all of us who would be able to come in buy homes sweep the streets around our houses, get involved, start over with whats left, like the 1850's and get back to common sense and decency. Maybe the reality of that is long gone, but it is worth a shot. First things first. the city needs occupants so it needs to get real and create a land rush. Offer freedom to all to open business' buy homes and contribute. We all have our ideas on how do do it, but discussing it will not get anything done would it ? | ||
Corktownmark Member Username: Corktownmark Post Number: 248 Registered: 12-2004 |
Did anyone else take a look at how cities and counties determine the total taxable values of property? Each City receives a report on the TOTAL value for real property in their borders. This is then used by each jurisdiction. Remember you may have heard of this over the years as State Equalized value. Maybe you can make an effort to understand the process before blaming the current ills on “communities that over-assess properties”. Or “they want the value that fits their arbitrary, narrow scope parameters for determining a value” Maybe your time would be better spent finding out about issues instead of demonstrating your lack of knowledge. We are looking at a property tax system that is out of whack with the current real values. The sale price of a single property has little to do with the Treasury department of Michigan’s valuation of the city or county it is in. Values across the state are dropping this is reflected in the 2008 valuations by city and should be further demonstrated for 2009. How can revenues already decreased by unpaid taxes on empty and foreclosed houses be balanced for any city or county in the state? http://michigan.gov/documents/ treasury/Wayne_245355_7.pdf | ||
Ocean2026 Member Username: Ocean2026 Post Number: 145 Registered: 11-2008 |
Texas uses the sale approach that I outlined. We have been doing this forever and I don't see any problems either with this approach or our economy and growth. | ||
Novine Member Username: Novine Post Number: 1230 Registered: 07-2007 |
According to this, Texas appraises property on fair market value, not sales price. http://www.window.state.tx.us/ taxinfo/proptax/remedy09/remed y09_1.html | ||
Ocean2026 Member Username: Ocean2026 Post Number: 146 Registered: 11-2008 |
yep and they ask the sale price to arrive at that. Its rare there is any real variance. When you buy or sell a property - you receive a one page questionnaire about what you paid etc. pretty simple -pretty effective | ||
Zrx_doug Member Username: Zrx_doug Post Number: 848 Registered: 03-2008 |
Gotta say no. I've lived in my neighborhood for twenty years, and I've watched the current resale value of my home go down the toilet just like everyone else. I'm not selling, but if I were, my home would be nowhere near worth what I've invested at this point in time. Meanwhile, the two houses on either side of me are both for sale (at bargain basement prices like every other piece of real estate in the country at this time)..so if these two homes -which are very similar to my own- sell cheap, why should I pay more taxes than my new neighbors for virtually the same parcel of property? When (not "if") the market rebounds, the buyers of these homes will already be $$$ ahead of me when it comes to resale vs. purchase price..why should they also get the boon of not sharing the tax burden equally in the meantime? | ||
Novine Member Username: Novine Post Number: 1237 Registered: 07-2007 |
"why should they also get the boon of not sharing the tax burden equally in the meantime?" The irony of this is that for the past 15 years, the opposite has been true. People who owned when Proposal A was passed have generally paid less than those who bought later, even thought the homes might be identical and have the same assessed value. | ||
Zrx_doug Member Username: Zrx_doug Post Number: 849 Registered: 03-2008 |
You're gonna have to define "less," Novine..these guys are talking about a neighbors equal-value home being taxed at something like ten to twenty times lower than the current property assessment. Before/after taxes under prop A are still in the same ballpark..what is being proposed in this thread isn't even playing the same sport! | ||
Novine Member Username: Novine Post Number: 1238 Registered: 07-2007 |
"Before/after taxes under prop A are still in the same ballpark..what is being proposed in this thread isn't even playing the same sport!" Not true in places like Birmingham. There were huge discrepancies in taxes. I don't think Ocean2026's proposal is going to go anywhere. No system is perfect and that proposal has as many flaws as the current one. | ||
Trainman Member Username: Trainman Post Number: 773 Registered: 04-2006 |
Mr. Hertel’s plan can work to LOWER Detroit property taxes. The purpose of Mr. Hertel's Regional Mass Transit plan will likely result in the elimination of state taxes in revenue sharing of over $100 Million per year for SMART and DDOT because the present state constitution does not protect community transit funds. This was shown in November 2006 when the city of Livonia lost over $2 Million per year to aid the handicapped and the elderly and why civil rights complaints are filed against the state government in Lansing, Michigan specifically the Michigan Department of Transportation and the $2 Billion dollar Detroit freeway expansions. The following sentences are primarily why all Detroit mayors and candidates support a Regional Transit Authority. This will LOWER Detroit property taxes. Then, the $70 Million per year Detroit property owners pay for DDOT could also be eliminated which will bring them in line with cities such as Livonia. This was part of the DARTA as was omitted but stated in public by suggestion at Livonia city hall and all over metro Detroit. Then, the resulting $140 Million per year will be REPLACED with a NEW county transit authority taxes combining both SMART and DDOT into a three county (Oakland, Macomb and Wayne) owned system by a sales tax as many other cities do and as voted by the public majority. This comes with a tax increase of sales for county roads also and a promise by President Obama for more federal funds at a cost of 1 percent sales to the county. Michigan has 83 counties and the three in southeast Michigan will be higher then the rest but the other 80 counties will also see a loss of funding from the Michigan Department of Transportation unless they fight this agency and challenge them for an account of public money. YES, we will get BIG freeways and trains in Michigan and even more cars. But, the poor will vote YES for the SMART property tax renewal in August 2010. They believe President Obama will give them support and they believe that paying higher taxes is the answer to get a better transportation system for all. Maybe someday another person like me will go out and fill the fare boxes up? It won't be me. I'm moving out of this area unless Mr. Hertel's plan actually works. I challenge him to debate me on television. It is not to defeat him but to help him fill the buses and trains up with paying customers, so the taxpayers will get more bang for the Buck. Go to DETROIT LINKS and Trainman's save the.. | ||
Ro_resident Member Username: Ro_resident Post Number: 222 Registered: 11-2003 |
SEMCOG put out a report about the changes in property values over the past few years. It discusses taxable values, SEVs, and the fiscal impacts of declining property values. http://library.semcog.org/Inma gicGenie/DocumentFolder/Fiscal CapacitySEMICommunities_2008.p df | ||
Ro_resident Member Username: Ro_resident Post Number: 223 Registered: 11-2003 |
SEMCOG put out a report about the changes in property values over the past few years. It discusses taxable values, SEVs, and the fiscal impacts of declining property values. http://library.semcog.org/Inma gicGenie/DocumentFolder/Fiscal CapacitySEMICommunities_2008.p df | ||
Ocean2026 Member Username: Ocean2026 Post Number: 148 Registered: 11-2008 |
Novine - I do agree with you on one thing- My tax proposal is going to go nowhere. All I did was place it here. I can also say another thing. Detroit isn't going anywhere either- well no where nice. No changes no improvements just the same old thing. Yes Id like to buy one of these old mansions and have it for a summer home- a nice contrast between the hot summers where I live, but I'm not ready to pay huge taxes- can't really afford to. There are many others like me - check all the posts $5000 home $7000 in taxes? All of those people and plenty who don't happen to post on the internet -think "Wow I can come to detroit and get a nice home for so cheap. Then they see the taxes and freak out. Where has your current system gotten you? You guys in Detroit already are not going to stem the tide of flight and decay. I was simply offering a different approach. | ||
Zrx_doug Member Username: Zrx_doug Post Number: 852 Registered: 03-2008 |
Ocean, I don't mean to burst your bubble..but adding more people to the burden supported by the city infrastructure without adding adequate funding to that infrastructure through taxation isn't exactly a recipe for success, either. We've got a city which cannot afford to provide basic services to the citizens it's already got, and you're proposing a way to add more citizens to the load without adding the tax dollars to support their added needs. | ||
Mikem Member Username: Mikem Post Number: 1920 Registered: 10-2003 |
Ocean, you have a thick skull. Within days of showing up here it was explained to you how dysfunctional the city is and how your plans for cashing in on cheap real estate were overly optimistic. You continued to ask the same questions over and over and we answered them again and again, and now you're repeating back to us what we already know as if it never occurred to us. So now we know; you can't afford to buy an inner city mansion as a summer home and you don't really want to. Go pester Cleveland or Buffalo or Milwaukee. | ||
Ocean2026 Member Username: Ocean2026 Post Number: 149 Registered: 11-2008 |
Mikem as I study this - I am offering a partial solution. You are more interested in personal attack which is quite macho considering you're hiding behind an anonymous screen name. Its not about me and one property I may or not buy- its about many people who might consider investing in Detroit. | ||
Zrx_doug Member Username: Zrx_doug Post Number: 854 Registered: 03-2008 |
"Many" people require "many" services. Who pays the taxes to provide these services if all these swell new folks don't? | ||
Ocean2026 Member Username: Ocean2026 Post Number: 150 Registered: 11-2008 |
Right now NO ONE is paying taxes on abandoned properties - absolutely no one. The foreclosure list is HUGE. Detroit is starting to get publicity see City-Data.com, people wanting to come and buy a $300 house etc. I said before there ought to be a minimum cap at say $5k valuation, but those people ought to be encouraged. Of course if they live there they will benefit the city in more ways than just paying the tax. They might eat,shop and create jobs. | ||
Zrx_doug Member Username: Zrx_doug Post Number: 855 Registered: 03-2008 |
If they can't afford to pay the property taxes, I find it awfully hard to believe they'll be able to afford much else. The majority of those "three hundred dollar" homes are in need of tens of thousands of dollars worth of plumbing & electrical work..the taxes are a fractional part of the investment. If taxes are a deal-breaker, I doubt the prospective buyer can afford to live there any more than I could afford the upkeep on a free jumbo jet.. | ||
Ocean2026 Member Username: Ocean2026 Post Number: 151 Registered: 11-2008 |
Some may be able to afford it some may not. There are many who might want a $100k bargain not just a $100. Come on even if someone can afford something doesn't mean they won't wait till there's a better deal. Finally I disagree with you about the taxes being insignificant. The example people use is a $5000 house with $7000 annual taxes. Remember that's ANNUAL so say the house is really worth $35,000, you are then paying a 20% annual tax. That may not shock people from Detroit or Massachusetts but for anywhere outside the east coast it is a huge deal-breaker. Texas which ranks in the middle of real estate tax ( because we have no state income) effectively taxes me at less than 1% and we all bitch down here about high taxes. 20% lol -- use your imagination. | ||
Zrx_doug Member Username: Zrx_doug Post Number: 858 Registered: 03-2008 |
Dude, if you're paying seven grand in annual city taxes for a house that's city-appraised at thirty-five thousand, you are being torn a new bunghole..someone is yanking your chain. That would be between five or six times the actual tax fees for a $35,000 Detroit home in my experience. | ||
Ocean2026 Member Username: Ocean2026 Post Number: 152 Registered: 11-2008 |
Zrx well many houses have fallen 40% in value over the past two years so perhaps a house that sold for $65k two years ago is now worth $35k. Look at all the houses that are cheap with $5-9 k in annual taxes - take an actual look and tell me what you think they are worth. If you really believe they are worth way more than $35k with a 5k tax bill then wouldn't you be a buyer??? If not -maybe you'll understand my point- there will be little to no investment in Detroit until tax issues are resolved. | ||
Zrx_doug Member Username: Zrx_doug Post Number: 862 Registered: 03-2008 |
We're in a severely depressed market..the assessed value of the home remains pretty much the same regardless of where the market goes. My home's actual value (had I wanted to sell) peaked at something like five times what I initially paid for it at the height of the real estate boom..but the assessed value didn't change anywhere near that dramatically. In fact, my city assessed value hasn't changed more than 4-5 thousand in the twenty years I've owned the place..it did go DOWN this year, FWIW. Look..you're getting a piece of property for a fraction of what it's going to be worth..recessions don't last forever, any more than booms do. Accept the great sale price for what it is, but realize that the city has got to assess the "real" value of it, not the peaks or the valleys. | ||
Ocean2026 Member Username: Ocean2026 Post Number: 155 Registered: 11-2008 |
Zrx I wish I had the confidence that Detroit will recover without the recession. I just like the cool summers and nice architecture, and hope there aren't too many people with Blacksoul's attitude. |
