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Earlier quoted context omitted.
How do receipts stay the same?
Property taxes are usually set as a fixed amount to be collected, and the tax % is back calculated. In practice, this means that the only thing that matters is the value of a property relative to the rest of the city.
Earlier quoted context omitted.
How do receipts stay the same?
Property taxes are usually set as a fixed amount to be collected, and the tax % is back calculated. In practice, this means that the only thing that matters is the value of a property relative to the rest of the city.
This is why changing zoning laws is so important. These buildings and their underlying values can be saved by 'going condo' or conversion to smaller unit spaces for the purpose of housing so many who are struggling with massive increases to rent. Most rent does not increase because of increased asset expenses, it increases because of increased owner expenses and that quickly becomes a slippery slope in the face of ad…
Renting is a service, a productive economic activity that yields net positive value to the society. The building did not fall from the sky and someone "claimed" it. Someone actually had to put in work and time and take risks for it to exist and be rented. Those enjoying the building benefit from these previous efforts, which in turn are compensated by receiving rent.
Earlier quoted context omitted.
Property taxes won’t change if these values collapse. A city may reassess values in the future but that just means some people go up and some go down with the final receipts the same. An owner may walk away from a Mortage and the bank will pay the taxes. If taxes are not paid you move into tax liens that trade and may be able to get the property just for the taxes on it. In the end property taxes get paid.
How do receipts stay the same?
Earlier quoted context omitted.
Property taxes are usually set as a fixed amount to be collected, and the tax % is back calculated. In practice, this means that the only thing that matters is the value of a property relative to the rest of the city.
Does the US use the same rates for all property types? At least in Canada (and in Sim City 2000…), the tax % is different for residential, commercial, industrial and often subcategorized further.
Current market prices for a lot of commercial real estate seems to be a ponzi scheme especially in the US. It is not in the interest of any of the players to decrease prices only the renters. Local government need higher prices as without the high property prices their property tax receipt will tank making them unable to meet their budgets. Banks need higher prices as they are highly leveraged and will be on the hook…
Earlier quoted context omitted.
Ponzi scheme? Yes. Lots of major players who really don't want the Ponzi pyramid to collapse? Yes. But, long-term, no Ponzi pyramid can avoid collapse. Black money is not infinite, and can get skittish when the music starts fading. A central bank printing money can prop the pyramid up...for a while. But that only makes the collapse bigger, and takes more of the central bank's economy down with it when it finally does…
>> Current market prices for a lot of commercial real estate seems to be a ponzi scheme > Ponzi scheme? Yes. How in the world are these the top comment and top reply? Commercial real estate isn't a ponzi scheme. Like, at all. In any way, shape, or form. There are disparate actors making separate, uncoordinated decisions. There are single transactions being made delivering real value. There's no long term holdings fal…
Current market prices for a lot of commercial real estate seems to be a ponzi scheme especially in the US. It is not in the interest of any of the players to decrease prices only the renters. Local government need higher prices as without the high property prices their property tax receipt will tank making them unable to meet their budgets. Banks need higher prices as they are highly leveraged and will be on the hook…
Ponzi scheme? Yes. Lots of major players who really don't want the Ponzi pyramid to collapse? Yes. But, long-term, no Ponzi pyramid can avoid collapse. Black money is not infinite, and can get skittish when the music starts fading. A central bank printing money can prop the pyramid up...for a while. But that only makes the collapse bigger, and takes more of the central bank's economy down with it when it finally does…