Property Taxes Going Up *Again*.

Of course, this won’t count as a “true” increase in state taxes. That the actual tax bills of almost everyone goes up, we won’t call it a tax increase. kare11.com has an article on how homeowners in Moorhead, Brainerd and Rochester will see their local property tax bills rise more than 10 percent next year. This continues a trend several years old that just bugs me. We’ve been shoving the tax burden from income and sales taxes to property taxes. Much of this is driven by certain pledges to “not increase taxes”. The problem is that sales and income taxes increase as you make more and spend more. So, if you pay more next year, there’s a pretty good chance you made more as well. This makes for a relatively fair system. Property taxes, on the other hand, are determined by what your house is worth. While this looks good on the surface (rich property owners, etc.), many homeowners are on fixed incomes and others just barely covering their mortgages. So, the house that Social Security could pay for 5 years ago is suddenly too expensive to stay in. They don’t have any more actual cash, they didn’t spend any more, etc. they just owe more. The taxable amount is entirely on paper and the only way they can access the extra money to pay for it is to remortgage their home. This is stupid and every time I see another story pushing this direction it just pisses me off. For most of the 20th century this country had progressive tax systems. Those who made more paid more. It’s starting to look like that will be just another chapter in the history books. If you make more than average, you’ve benefitted from the stable economy, society and general environment than average and should pay more than average (and just to be clear, I’m *in* that category and still feel this way).

2 Comments so far

  1. Kristi (unregistered) on October 13th, 2005 @ 10:10 am

    Man, don’t even get me started on property taxes. Owning a home for me was pretty much the worst and most expensive experience of my life (next to failing my driver’s license test three times). I was in the group that could barely make the mortgage payment, and the second year I owned my home, my payment went up $112 a month due to property tax increases. I’m not sure, but I think I ate macaroni & cheese that entire year. And granted, a large chunk of that increase was due to school levies, but I agree with you. There has got to be a better way to assess property taxes. Of course they’re always going to go up. House values always go up. It seems like a never-ending resource pool.

    Now that I’m divorced and back to apartment living, I have so much more money! My rent is $500 less than my mortgage payment was. My bills are 1/8 of what they were. And some people will tell you that a rent payment is like throwing money away, but no, I don’t think so. My rent payment is worth it to me to have the nice roof over my head that I do. I’m paying for a home, and just because I won’t be able to sell it in a couple years and make some dough doesn’t mean it’s not worth it. Some people are just in it for the money, though.

    Okay, I’m done ranting.


  2. Lex (unregistered) on October 13th, 2005 @ 4:13 pm

    I’ve had my place (a condo) for just over a year now, and I will be curious to see what happens to my property values and taxes. Of course I want my home to be worth more, so I net more from the sale, but I don’t want to get squeezed out of my place because I can’t afford it.

    I’m on par with what I used to pay for rent in my St. Paul apartment. I have changes I could make to my expenses to have more available cash to pay for a property tax hike, but there’s a limited amount of what my personal economy can absorb.

    Still, I feel best about the fact that I only have one mortgage on the place, unlike friends who have two mortgages and home equity loans eating all their equity.



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