Quote:
Originally Posted by FurnaceFace
I haven't read all the pages on this, so perhaps it's been discussed already. However, I haven't benefited from this yet. I bought my house 10 years ago, in that time the assessment has nearly tripled. I still own the house and while on paper I have a great investment, it's only great if it's actually sold. Selling my house means I have to buy another which means I'm paying the inflated prices everyone else is.
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Keep in mind what the assessed value is for. I'm sure in that time your taxes haven't also tripled.
What the city does is says takes the value of all property and dicides the taxes up depending on how much your house is worth. So let's say there are $1 billion worth of houses, and your house is worth $250K. The city needs to collect $10 million in taxes. Because your house is worth .025% of the total of all houses in the city, you are responsible for .025% of the tax load. So $2500.
Now your neighbour has an identical 1000 square foot house as you. He buldozes it and builds a monster 2500 square foot house. The city re-asseses his house at $500K, so now he owes twice the taxes you do.
Now let's say 10% of the city does the same thing as your neighbour. Everybody else's house goes up 5% in value. Because there is now $1.15 billion worth of inventory, and your house has only gone up 5%, your taxes will actually go down the next year; even though the value has gone up.
My example is an extreme over-simplification; as the calculations are not made that easy. There are mill rates, etc. But it gives you the general idea- that the city isn't getting some windfall from long-term home owners and blowinging it like a sailor with a weekend pass.