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In Greece, Property Is Debt

nytimes.com

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Re: In Greece, Property Is Debt

#171

Post by [deleted] »

Ntrails wrote: post #169
nugget wrote: post #159

Earlier quoted context omitted.

> Nobody would buy the house If you put this hypothetical 90k euro house up for sale at a public auction tomorrow, what would it sell for? 50k? 70k? Real assets are usually sale-able, albeit perhaps for less than the owner thinks the asset is worth. > Move to where? Another city? Another country? Unemployment is everywhere in Greece. Since Greece is still in the EU, you can move to any member country right? UK, Germa…

> Personally I would vote for revolution - national default, totally new political leadership They tried that. Turns out politicians aren't actually very trustworthy...

[deleted]

Re: In Greece, Property Is Debt

#172

Post by andmarios »

imaginenore wrote: post #93
andmarios wrote: post #58

Earlier quoted context omitted.

You have to factor in that we have an extremely high unemployment rate (23.5%) and after the austerity measures the basic wage is about 550 euro/month. Many, if not most, companies took advantage of this basic wage change and forced it upon their employees or replaced them with new ones (which can't ask for more). Also another big part of the workforce is on flexible-hours, which means they may go as low as 120 euro…

So why not accept the inheritance and sell the house?

Still cheaper than rent. Also you have to factor in that a house is more than money (memories, feeling of safety, etc) unless you are into real estate.

Re: In Greece, Property Is Debt

#173

Post by CyberDildonics »

nugget wrote: post #142
kkapelon wrote: post #126

Earlier quoted context omitted.

Numbers don't really say anything if you don't explain who decides them. Here are two scenarios for you 1)I live in Greece and get 400 Euros a month and barely break even. I live in a house (inherited by my parents) that would fetch probably 90.000 in the market. Government says that it really costs 300.000 euros. I get taxed for it even though I cannot really afford it. 2)I am unemployed and live with my parents. Th…

Wouldn't the solution in either case be to sell the house and move somewhere you can find a job?

Or buy a different 90,000 house that is valued at 90,000.

Re: In Greece, Property Is Debt

#174

Post by CyberDildonics »

nugget wrote: post #159
kkapelon wrote: post #153

Earlier quoted context omitted.

Nobody would buy the house (apart from foreigners) because it is now linked to the tax that everybody wants to avoid. Also cash flow is a big problem for everybody so it is hard to find somebody that has 90.000 in cash and also willing to buy it. Move to where? Another city? Another country? Unemployment is everywhere in Greece. I am not even mentioning the sentimental factor of being forced to sell your parents hous…

> Nobody would buy the house If you put this hypothetical 90k euro house up for sale at a public auction tomorrow, what would it sell for? 50k? 70k? Real assets are usually sale-able, albeit perhaps for less than the owner thinks the asset is worth. > Move to where? Another city? Another country? Unemployment is everywhere in Greece. Since Greece is still in the EU, you can move to any member country right? UK, Germa…

> If you put this hypothetical 90k euro house up for sale at a public auction tomorrow, what would it sell for? 50k? 70k?

I'm not a mathematician, but I think that would make it a 50k or 70k house.

Re: In Greece, Property Is Debt

#175

Post by elcct »

soVeryTired wrote: post #81
elcct wrote: post #10

Earlier quoted context omitted.

I think faults in each country have one thing in common - socialism and excessive bureaucracy that comes with it.

Socialism is a spectrum. Are you talking about full-on soviet communism? The Scandinavian model? Venezuela? The national health service in the UK? I'm don't really think that socialism == bureaucracy == failure is a cogent argument.

You can compare socialism to cancer. Some forms of it are terminal some are not, but it is not sustainable thing to have.

Re: In Greece, Property Is Debt

#176

Post by hx87 »

wu-ikkyu wrote: post #160
hx87 wrote: post #141

Earlier quoted context omitted.

If everybody had an account with the central banks, sure. For now the SUs only have access to the major-banks sandbox, and playing around in this sandbox does nothing except cause asset inflation.

The 2008 bailout and subsequent legislation[1] indicates it is the major-banks (i.e. JP Morgan, BOA) which have the leverage to create money at will over the central-banks (i.e. the Fed). Hence the term "Too Big to Fail" -- de facto SUs. Doesn't the major-banks' sandbox extend across the world to any person or government who accepts the dollar? [1] http://www.businessinsider.com/congressional-budget-makes-ro...

By "sandbox" I meant that the central banks dealt directly only with major banks, who benefit and profit from being at the top of the money-creation chain.

Re: In Greece, Property Is Debt

#177

Post by Kalium »

kkapelon wrote: post #153
nugget wrote: post #142

Earlier quoted context omitted.

Wouldn't the solution in either case be to sell the house and move somewhere you can find a job?

Nobody would buy the house (apart from foreigners) because it is now linked to the tax that everybody wants to avoid. Also cash flow is a big problem for everybody so it is hard to find somebody that has 90.000 in cash and also willing to buy it. Move to where? Another city? Another country? Unemployment is everywhere in Greece. I am not even mentioning the sentimental factor of being forced to sell your parents hous…

> 3) I am 75 years old living with my wife who is 70 years old in the house that we bought in 1950. We are both retired farmers. Our pension is 500 euros in total. In 1950 the area we selected for our house turned out to be a popular one (in 1950 it was just an empty field).

This was regarded as a major incipient problem in California at once point. So a policy to address it was put in place - Proposition 13. It caps property tax increases to a quite low level.

Cities and counties cope by voting on a random assortment of taxes and assessments every two years. In major cities, where most people rent, this means property owners have their taxes go up very unpredictably. Though rarely more than single digit percentages.

This sounds great, but in practice it's created havoc. Turns out some solutions are worse than the problems.

Re: In Greece, Property Is Debt

#178

Post by antisthenes »

kkapelon wrote: post #153
nugget wrote: post #142

Earlier quoted context omitted.

Wouldn't the solution in either case be to sell the house and move somewhere you can find a job?

Nobody would buy the house (apart from foreigners) because it is now linked to the tax that everybody wants to avoid. Also cash flow is a big problem for everybody so it is hard to find somebody that has 90.000 in cash and also willing to buy it. Move to where? Another city? Another country? Unemployment is everywhere in Greece. I am not even mentioning the sentimental factor of being forced to sell your parents hous…

Out of all the scenarios you posted, this is actually the easiest to solve:

> 3) I am 75 years old living with my wife who is 70 years old in the house that we bought in 1950. We are both retired farmers. Our pension is 500 euros in total. In 1950 the area we selected for our house turned out to be a popular one (in 1950 it was just an empty field). Government passes the law and our house has a value of 500.000 (because of the area around it). Now out of the blue we have to pay property tax. What do we do?

You sell the house and move somewhere with a cheaper COL. Presumably the assumption here is that neither you nor your wife work, so you are unproductive members of society (this is meant without negative connotation). However, there's no reason you should continue to be subsidized by the people living around you who are, again presumably, fine with paying the property tax. They are more able to put this popular area to good economic use.

Re: In Greece, Property Is Debt

#179

Post by naveen99 »

cpr wrote: post #137

Gee, in the US, all property is debt as well. (Property tax.) So you don't really own your property--if you fail to pay, you will ultimately lose possession. http://taxation.lawyers.com/property-tax/when-you-cant-pay-y...

There are tax exempt properties like farm land and of course property owned by non profits.

Not sure why countries like india leave property tax on the table.

Re: In Greece, Property Is Debt

#180

Post by HillaryBriss »

Kalium wrote: post #177
kkapelon wrote: post #153

Earlier quoted context omitted.

Nobody would buy the house (apart from foreigners) because it is now linked to the tax that everybody wants to avoid. Also cash flow is a big problem for everybody so it is hard to find somebody that has 90.000 in cash and also willing to buy it. Move to where? Another city? Another country? Unemployment is everywhere in Greece. I am not even mentioning the sentimental factor of being forced to sell your parents hous…

> 3) I am 75 years old living with my wife who is 70 years old in the house that we bought in 1950. We are both retired farmers. Our pension is 500 euros in total. In 1950 the area we selected for our house turned out to be a popular one (in 1950 it was just an empty field). This was regarded as a major incipient problem in California at once point. So a policy to address it was put in place - Proposition 13. It caps…

> In major cities, where most people rent, this means property owners have their taxes go up very unpredictably.

Interesting. I've heard about the predictable 2% YOY residential property tax increases allowed by Prop 13 (in Los Angeles), but I haven't heard about people experiencing significantly larger, unpredictable property tax hikes.

I'm curious about the very unpredictable property tax hikes you're describing. How big have these been? Are these on apartment buildings or other commercial properties?

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