In Greece, Property Is Debt • Hacker News Board

Re: In Greece, Property Is Debt

#181

Post by Kalium » Wed, Nov 02, 2016, 6:25 PM UTC

HillaryBriss wrote: post #180

Kalium wrote: post #177

Earlier quoted context omitted.

> 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. H…

Prop 13 limits direct property taxes, but voter-approved direct assessments aren't limited. Depending on how votes go in Oakland and Alameda County next week, assessments might go up anywhere from $0 to $600+/yr on a single family home. I cited places where most people rent because it's easier for renters to think of property taxes as taxes that get paid by people who aren't them and it's always easier to vote for taxing someone else.

Some of them are property value percentages. Some of them are flat parcel taxes. The two fall differently on multi-family and single-family buildings. I believe commercial property is generally not exempt.

I'm not aware of any tax hikes that large in recent history, but sometimes the re-assessment at sale from Prop 13 can cause jumps bigger than that.

Re: In Greece, Property Is Debt

#182

Post by kkapelon » Wed, Nov 02, 2016, 6:28 PM UTC

dalore wrote: post #88

So as a foreigner, now would be a good time to buy some Greek real estate?

In my opinion yes. In fact I would tell you to wait because prices may become even lower.

Re: In Greece, Property Is Debt

#183

Post by wu-ikkyu » Wed, Nov 02, 2016, 6:41 PM UTC

hx87 wrote: post #176

wu-ikkyu wrote: post #160

Earlier quoted context omitted.

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.

That's what I thought, I was using it as scope of influence as well

Re: In Greece, Property Is Debt

#184

Post by ThrustVectoring » Wed, Nov 02, 2016, 7:16 PM UTC

sliverstorm wrote: post #151

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…

Corrupt tax valuations are a problem, but it's practically one of the tenants of property tax that it is supposed to elbow you out if you can't afford the tax. It's not "nice" to say, but one of the purposes of property tax is to serve as a market force to encourage better usage of valuable land.

One possible fix is a law that states the government must purchase properties at the assessed price (or at something like 85% of the assessed price). Then if the tax office assesses your house at triple its actual value, well, they just handed you a giant pile of cash.

Re: In Greece, Property Is Debt

#185

Post by mjevans » Wed, Nov 02, 2016, 7:23 PM UTC

NYT == Paywall == they don't want me to read the story.

I'll gladly enjoy the comments, but this is my protest at allowing sources that are paywalls (except, perhaps, if a given story is in a fully public section).

Re: In Greece, Property Is Debt

#186

Post by pyb » Wed, Nov 02, 2016, 7:24 PM UTC

CyberDildonics wrote: post #174

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…

> 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.

Well put. If the house, 'valued' by the government at 300k, is actually a '90k' house that will in fact sell for 50k, perhaps it's time to get real, save time and call it a EUR 50k property from the start. Everything sells for the right price.

As for the issue of finding a buyer, I am hearing rumours that many Greeks have built up sizeable assets, from not paying very much tax in the last few decades. Many areas in Greece are also popular with European buyers.

Re: In Greece, Property Is Debt

#187

Post by sasvari » Wed, Nov 02, 2016, 7:26 PM UTC

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…

Personally I would vote for revolution - national default, totally new political leadership - and start to rebuild the country from scratch. Anything is better than decades of externally enforced austerity crippling a country's spirit as reflected in everything I read these days about Greece.

Looking at the democratically elected politicians/governments in Greece in the last decades I don't know where a totally new political leadership [edit: which would be interested and capable of 'rebuilding the country'] should come from. It's not that the electorate didn't consistently vote for the political leaderships which are/were, at least partially, responsible for the situation Greece finds itself in right now.

Re: In Greece, Property Is Debt

#188

Post by gohrt » Wed, Nov 02, 2016, 7:32 PM UTC

sliverstorm wrote: post #151

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…

Corrupt tax valuations are a problem, but it's practically one of the tenants of property tax that it is supposed to elbow you out if you can't afford the tax. It's not "nice" to say, but one of the purposes of property tax is to serve as a market force to encourage better usage of valuable land.

"tenants of property tax" would be a rental tax ;-)

Re: In Greece, Property Is Debt

#189

Post by mjevans » Wed, Nov 02, 2016, 7:35 PM UTC

ThrustVectoring wrote: post #184

sliverstorm wrote: post #151

Earlier quoted context omitted.

Corrupt tax valuations are a problem, but it's practically one of the tenants of property tax that it is supposed to elbow you out if you can't afford the tax. It's not "nice" to say, but one of the purposes of property tax is to serve as a market force to encourage better usage of valuable land.

One possible fix is a law that states the government must purchase properties at the assessed price (or at something like 85% of the assessed price). Then if the tax office assesses your house at triple its actual value, well, they just handed you a giant pile of cash.

I actually like this idea. Lets take it a tiny bit further.

To prevent the government from harassing you in to forced sales they don't intend to complete, make it a guaranteed minimum of the larger of 90% of the assessed value or 85% of the final sale price. Also the government, while the property is for sale, allows your continued use as previous and pays you 0.005% of the assessed value of the property //per month// for the privilege of listing it and allowing buyers to view it during normal business hours.

At any time the government can cancel the deal and re-assess the value of the property, which shall be official retroactively for tax purposes (as far back as re-filing is allowed).

At any time the current owners can cancel the deal, but then agree that the valued price is fair and valid as well as are required to hold the property for a full year after the cancellation.

Re: In Greece, Property Is Debt

#190

Post by erispoe » Wed, Nov 02, 2016, 7:41 PM UTC

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...

Turns out when people have to actually govern the thing they're pragmatists. That's what happened to Syriza. They're not "untrustworthy", they're just doing the best with the hand they inherited considering what EU politics are right now.