January 26, 2009

Free child with purchase of Redwood City house

1416 Oxford St, Redwood City, CA 94061 Central Park MLS# 80850865 – Property Details
$575,000

1196581759_1416

* Status: Active
* Bedroom: 3
* Bathroom: 2
* Year Built: 1930
* Lot Size: 5985
* Square Footage: 1350
* List Date: 12/30/2008
* Garage Spaces: 1

Fixer upper!!; needs some completion work in Master Bath, laundry room,and some additional finish work, great potential; sold “as is “; ; Kitchen has granite counter tops; granite fireplace,too many things to list in this 3 Bed. 2Ba.Spanish Style home. Good location for quick sale.

What? The child isn’t included? Oh. What about the CRT? Or the stuff on the table? Oh.

Actually the real reason I chose this house was because of the reality based television style photos used. Frankly, I’m tired of those professionally staged, DSLR photos that are a dime a dozen. I want my photos gritty and action packed. The video-style of these definitely heighten the senses and make these photos come alive.

Let’s take a look at a few more shall we?

705574956_1416a

Wow. It’s like I’m seeing this on TV. Hey, if you buy this, maybe you can end up on HGTV!

Thanks to Burbed reader Sonnarrat for the find.

Comments (118) -- Posted by: burbed @ 5:44 am

118 Responses to “Free child with purchase of Redwood City house”

  1. Prof. Bleen Says:

    Spanish-style? I don’t think so; people in Spain, I believe, have interior lighting. The occupants of this house apparently huddle together at night and nervously wait for the sun to reappear.

  2. Real Estater Says:

    Good news:

    A private research group’s monthly forecast of economic activity rose unexpectedly in December, mostly because the flood of federal bailouts increased the money supply.
    ..
    Separately, existing home sales rose 6.5 percent in December to an annual rate of 4.74 million units
    ..
    The New York-based Conference Board’s monthly forecast of economic activity increased 0.3 percent in December. Economists surveyed by Thomson Reuters had expected a 0.3 percent decline.

  3. sv_newbie Says:

    yeah, it’s good news, but as we know most of it is foreclosure sale, so they should be treated differently.
    i think a better indicator would be median prices.

  4. nomadic Says:

    Bleen – that’s hysterical! I think you have it pegged.

    As for the photos, the explanation is “Help-U-Sell.” The owners are selling as cheaply as possible in spite of the fact they only paid $350k for that hell-hole in 2000. It’s too close to Woodside Rd for most people to want it. Then there’s the unfinished work…

    So where’s the free kid?

  5. nomadic Says:

    Oh, I see the kid now. Looks like they were having an old-fashioned “porch grab” (aka garage sale) when they took the pics.

  6. sonarrat Says:

    RE: flat is the new up, eh?

  7. A. Lewis Says:

    Nice selective reporting RE. You are so disingenuous. It is clear your intent is to indicate the housing market is improving and is past the bottom, and to reinforce your dogmatic notion that ‘now is a good time to buy’. Well, that’s fine, but allow me to give a contrary opinion.

    Let me show you all a more complete picture: please read the recent posting on CalculatedRisk, a great website with objective commentary and data on finance and real estate. You can see where RE’s quote comes from (it’s the NAR) and a lot more:

    http://www.calculatedriskblog.com/2009/01/existing-home-sales-increase-in.html

    Let me highlight just a bit more of the text:

    Existing-home sales – including single-family, townhomes, condominiums and co-ops – jumped 6.5 percent to a seasonally adjusted annual rate of 4.74 million units in December from a downwardly revised pace of 4.45 million units in November, but are 3.5 percent below the 4.91 million-unit pace in December 2007.

    For all of 2008 there were 4,912,000 existing-home sales, which was 13.1 percent below the 5,652,000 transactions recorded in 2007. This is the lowest volume since 1997 when there were 4,371,000 sales.

    So first, they just downwardly revised November, so it was WORSE than you might have last heard (I don’t think RE bothered to post the Nov. data point a month ago when it was available – hmmm, why would that be?), and that makes the December improvement a bit better. NAR was only slightly quicker than RE to trumpet this great news.

    Please, PLEASE, read the rest of the entry there – CR gives a nice overview.

    The number RE should be citing is that months of supply (nationwide – useless, aggregate data) is down to ONLY 9.3 months vs. a peak of 11+. The standard benchmark is: more than 6 months of supply = buyers market, less than 6 months of supply = sellers market.

    Also, it’s well known that people pull homes off the market in December b/c sales are so slow, so the drop in inventory is expected due to seasonal patterns, not a sign that supply is so low prices will soon soar!

    Despite the seasonal slowdown, inventory in the nice parts of the BA are way higher than normal in December, and they’ll continue to be for a while.

    Keep bargain hunting…it’s the buyer’s turn for a while now. Sorry sellers…these things happen in cycles, and it can’t always be to your advantage.

  8. A. Lewis Says:

    Oops, just to stay OT:

    That listing is an insult to Spain, and Spanish anything. It’s an insult to the word style, too. Nice find, Sonnarrat.

    I have Spanish friends with Spanish style, and 1416 Oxford St. you are no Spanish-style kind of house.

  9. nomadic Says:

    Could changes to Prop 13 be on the horizon?

    At the heart of California’s problems, economists say, is the government’s heavy reliance on personal income taxes, which produces wild swings in revenue as its coffers overflow in good years and dry up in leaner times.

    California is a pioneer state famous for its entrepreneurial spirit. But an entrepreneur who might make $2 million in boom times could go bust in a recession.

    A big reason for the state’s reliance on income taxes is Proposition 13, a voter-approved change to the state Constitution that limits property tax increases and requires any plan to boost taxes to receive the approval of at least two-thirds of the legislature.

    The 1978 measure was credited with sparking anti-tax sentiment in other states and assisting Ronald Reagan’s election as U.S. president two years later.

    Legislators have responded by burdening state residents with some of the highest income and sales taxes in the country.

    Economists say the state has long needed to fix that revenue roller-coaster ride and are hopeful that this crisis will force leaders to face the music.

    http://www.reuters.com/article/newsOne/idUSTRE50P0ZX20090126?sp=true

  10. BuyersAreIdiots Says:

    Bravo A. Lewis.

    I would have provided a retort of my own but you beat me to the punch. Kudos for shoveling Real Excreter’s BS right back into his face.

  11. A. Lewis Says:

    CalculatedRisk has all your data and analysis on Existing Home Sales – this is an awesome summary of the sales and inventory numbers. Don’t listen to RE’s spin, or NAR’s spin, or my spin on the numbers – look here:

    http://www.calculatedriskblog.com/2009/01/existing-home-sales-nsa.html

    CR called the top back in 2005…if you want someone with a track record…he’s it.

    We miss Tanta…

  12. BuyersAreIdiots Says:

    Could changes to Prop 13 be on the horizon?

    When Ahhhh-nold took over office back in 2003, he requisitioned the advice of Warren Buffett to determine how best to handle the state’s budget woes.

    And what was good ol’ Warren’s first suggestion?
    “Repeal Prop 13″

    Pity the Governator didn’t listen.

  13. A. Lewis Says:

    Like I said a while back, – RE’s job is easy. This persona of his has it easy…sitting back, throwing a few easy to cherry-pick things out for us to go nuts over. On the other hand, it takes a bunch of typing and energy and even (gasp) research to carefully refute that garbage without making one’s own unfounded suppositions.

    As Thomas Jefferson said (I had to google it to get it right): “The price of freedom is eternal vigilance.” If you stand around and do nothing, the greedy folks will take advantage.

    I once read or heard, I can’t remember where, that any human society of more than handful of people can be broken down into different character types: mostly ‘normal’ folks, a very small number of utter ‘sociopaths’ (your mass murderers, etc.), a very small number of ‘super-leader’ types (if any at all), and then a couple of interesting minority segments that are always there: the ‘cheaters’, who are only slightly different from ‘normal’ folks, but they are seeking a way around the hard work, or the slow road to success; and finally the ‘cheater-detectors’, again only slight different from ‘normal’ folks, but who can’t stand by like other ‘normal’ folks while any ‘cheaters’ are getting away with anything, it gets to them to see any ‘cheating’. They feel compelled to root out and expose the ‘cheaters’ in their society, even if it takes time away from ‘normal’ work.

    I always picture a small Clan-of-the-Cave-Bear type nomad group, with mostly ‘normal’ people doing the hunting/gathering thing to sustain themselves – it’s hard, but they survive… Once in a while someone goes nuts and kills someone for no reason or just acts crazy – the ‘normals’ push him off a cliff pretty quickly, that’s an easy call.

    But then, in the shadows there’s 1 or 2 ‘cheaters’ who realize they can steal a bit of food and clothing from the other ‘normals’ and life is easier for them with less work. Especially if they don’t get caught.

    Then there’s 1 or 2 who notice the cheaters doing their thing – and maybe they cry foul but can’t prove it and get yelled at for making a fuss – but they’re ‘cheater-detectors’ at heart, and can’t let it go, so they watch the cheaters like a hawk, even if they miss a few hunting/gathering opportunities.

    I appreciate the ‘cheater-detectors’, who have the ‘normal’ guy’s best interests at heart.

    An obvious modern cheater example is a petty theif. An obvious cheater-detector example is a regular city police officer. But there’s lots more fun examples of these character types in society.

    Look around your office space – what do you find? Anyone stolen your coffee creamer out of the fridge lately? Has some other guy posted a sign on the fridge stating the ‘rules’ for coffee creamer storage/stealing? :-)

  14. A. Lewis Says:

    You’ve got my vote to repeal Prop. 13. It’s a cure worse than the disease (I can appreciate the CONCEPT of crippling property tax burdens, can you appreciate the concept of no state funding for schools, roads, and other infrastructure? can we find a middle ground?)…

    I would support a more modest modification to Prop. 13: Allow the annual raise in property taxes to go up as high as the CPI for the state of California that year, not matter what CPI is, instead of the current cap at 2%.

    This is not as high as say the market rate increase of home prices alone, which would be ‘fair’ but the equivalent of a nuclear bomb, but it would:

    A) Keep property taxes in line with every other damn thing, so it could hold it’s share of state revenue over the long-term.

    B)Have a mild downward influence on home prices and help prevent bubbles (a little bit).

    Note that many other states don’t have Prop. 13 but still had housing bubbles. Houses can certainly appreciate even with higher property taxes. Many many examples. Real Estate would still be a good investment compared to other classes, just slightly less tax-advantaged, especially over the long term.

    Note also: just b/c the property taxes can go higher, doesn’t mean the people of California can’t change their mind on how high property taxes should be.

    It would be OK with me if we could all decide what a fair property tax is – currently it’s 1% for the state, and then additional local stuff usually adds up to 0.3 to 0.6% more or something, right?

    Except we only get that 1% for the first year, then it falls behind CPI (except in years when CPI is below 2%, which is very rare – 2009 anyone?).

    So if people want to say 0.5% for the state is more fair than 1%, that’s fine, just let that amount stay at 0.5% into the future by following CPI.

    Unless you believe property taxes should be 0.0% (which I guess is one point of view), I don’t think increase caps are justified.

    I’d also be perfectly willing to have exemptions for certain non-profits, & elderly folks who live on the property who are on fixed income and fall below some means test of wealth. Any intelligent legislation allows for the complicated world we live in, and makes a reasonable attempt not to crush people. Especially the poor, sick, and elderly.

    Everyone else can pony up a bit more to support the state. It’s only fair.

    Once you allow it to follow CPI, which income and sales taxes effectively do, then it properly occupies some share of state revenues.

    THEN you can debate about the share of state revenue that can come from Property, Income, and Sales Taxes, and it’s a welcome and interesting debate. Just like the debate about how to spend the revenue.

    But with Prop. 13, the debate is choked off…

    Don’t even get me started on the 2/3 vote to raise taxes, but majority for anything else.

    Why on earth can’t 51% of the people vote to raise taxes? If it turns out badly, just vote ‘em out, and put in guys who want to lower taxes next time. It’s called democracy…

  15. nomadic Says:

    Love the whole “cheater-detector” thing. Fascinating. A #1 example: the guy who tried for over a decade to get the SEC to investigate Madoff.

  16. Real Estater Says:

    Guys,

    These are the top economic news of the day, quoted straight out of the media. There’s really nothing to dispute here!

  17. Unreal_Alex Says:

    Will more houses come with child slaves in the future?

  18. Real Estater Says:

    The debate on Prop 13 has got to stop. The solution to our economic problems is not more taxes, but fiscal responsibility. More taxes will kill the economy right now.

  19. bg Says:

    Repeal Prop 13?!? Does anyone (except for the mindless liberals in the RBA) really believe that Californians are going to vote themselves a MASSIVE TAX INCREASE in the midst of a huge recession?

    Prop 13 is not the reason for the state’s fiscal problems. Runaway government spending and mandates that destroy jobs are the real problems.

    Arnold wants to increase the cost of energy and autos in California in the name of the environment. Well my friends, nothing we do in California will make a dent in manmade global warming (if it exists at all).

    All the environmentalist wacko policies will do is kill our economy.

  20. bg Says:

    —-”Why on earth can’t 51% of the people vote to raise taxes? If it turns out badly, just vote ‘em out, and put in guys who want to lower taxes next time. It’s called democracy…”—-

    Why? Because your wish is against the State Constitution. You don’t know very much about democracy or the rule of law.

    Don’t you believe in our constitution?

  21. Real Estater Says:

    >>You can see where RE’s quote comes from (it’s the NAR)

    Are you joking? The quotes are from the Associated Press. NAR probably used the same quotes, as is every other media outlet, because these are the news of the day!

  22. Real Estater Says:

    The voters of California overwhelmingly support Prop 13, that’s why there is no way it will be repelled.

    “Tax the homeowners” is a minority opinion.

  23. zanon Says:

    A Lewis:

    We *do* miss Tanta : (

  24. Real Estater Says:

    More good news (Source: CNN):

    Brusca said he agreed with many economists’ predictions that the recession will end after the second quarter of 2009. Americans might feel the job market start to bounce back a bit sooner than expected, he said.

    “These recessions are like geometry,” Brusca said. “It looks like we’ll have a V-shaped cycle, in that we’re going into this with very sharp losses. This intense-phase recession will probably recover fairly quickly, with the job market coming out it at the same angle it came in.”

    In the short term, the economy and the job market are in trouble, Brusca said. But “it doesn’t look like the bottom is falling out of the economy,” he said.

    And there’s a silver lining to the gloomy clouds over America’s economy.

    “The good news is it’s so bad right now that we will have a definite, noticeable recovery when it comes,” Brusca said. “We’re getting a lot of adjustment out of the way early.”

  25. BuyersAreIdiots Says:

    Prop 13 is not the reason for the state’s fiscal problems. Runaway government spending and mandates that destroy jobs are the real problems.

    It is a combination of both actually.

    Prop 13 was a triumph of greed and stupidity over common sense.

    What it essentially did was defer the tax burden to the subsequent generation and give those that enacted that stupid legislation a free lunch.

    Now the state has to compensate by increasing taxes on incomes. As a result, we are rapidly hemmoraging hard-working middle class workers and replacing them with freeloaders or illegals that don’t pay into the tax system. It is so lop-sided it is almost laughable.

  26. burbed Says:

    Recent polls indicate that Prop 13 enjoys a support rate of 70%.

  27. BuyersAreIdiots Says:

    Recent polls indicate that Prop 13 enjoys a support rate of 70%.

    Recent polls today also showed that 48% of the country doesn’t believe in evolution.

    As I said, triumph of greed AND stupidity when it comes to Prop 13.

  28. BuyersAreIdiots Says:

    Bloody Monday: More than 50,000 jobs lost
    Six companies announce massive job cuts in a scary start to the week.

    AMERICA’S MONEY CRISIS
    Bloody Monday: More than 50,000 jobs lost

    NEW YORK (CNNMoney.com) — The final week of January began with a bloodbath for the job market, as more than 50,000 more cuts were announced on Monday alone.

    At least six companies from manufacturing and service industries announced cost-cutting initiatives that included slashing thousands of jobs.

    About 185,000 job cuts have been announced so far this year, according to company reports. Nearly 2.6 million jobs were lost over 2008, the highest yearly job-loss total since 1945.

    Keep ‘em coming Real Excreter.

  29. nomadic Says:

    BAI (BuyersAreIdiots) – love your posts. Keep ‘em coming. :-)

    You realize, however, that 20,000 (yes 20 THOUSAND) job cuts at Caterpillar couldn’t possibly affect the RBA… that’s way………..over………..there!

  30. bg Says:

    If you want an indication of stupidity, just look at the 53% of the voters who cast their vote for B. Obama!

    Talk about not understanding an empty suit candidate!

    But we’re stuck with him–I’m sure that his $1,000,000,000,000 stimulus package (including money to reduce the number of births in America) will do wonders for our economy.

    RBA nut congresswoman Pelosi said that one of the solutions to overtaxed governments in America was to prevent more births from occurring. This can be accomplished with more abortions and contraception!

    The New Democrat Party and a New Beginning!

  31. A. Lewis Says:

    I accept that Prop. 13 enjoys majority support. So did other things in the past that I was against. And it’s fine to seek to change them. I’m sure there was a time when the majority didn’t support the right of women to vote, or didn’t support restrictions on child labor (to name a fiscal instead of social policy). Majority support doesn’t mean a thing is right – but it certainly is a reality that should be faced, and I don’t pretend otherwise. Anyone who thinks it’ll be ‘easy’ to overturn, or even modify Prop. 13 is just poorly informed. Having said that, it’s possible the CA budget crisis will reach such epic proportions that very big changes like this could become possible. It was an absurd notion in 2006, but it doesn’t sound so absurd to me now.

    To respond to #19 and #20, bg: I understand that Prop. 13, and other things are part of state law, some of them constitutional amendments, and I firmly believe in the rule of law and support the constitution.

    When I said “Why on earth…” it was a rhetorical question. If it wasn’t then the obvious answer is “because it’s the law, stupid”. Thanks, I get that.

    Also within our laws is the right to free speech, and the process for amending the constitution from time to time.

    I think what I did was share my opinion on a good amendment of our existing laws, and to CHANGE things so that 51% of the state legislature (who of course, act in proxy for the people in our political system) COULD vote to increase taxes. You can differ on that being a could change in laws or not – that’s a welcome debate.

    But you don’t help your case much by just claiming I’m really ignorant.

    I would also assert along with #25 that Prop. 13 is a contributor to the state’s fiscal problems – of course it’s not responsible for all of them.

    Let’s also add on: YES we shoud limit greenhouse gas emissions, and I support tougher tailpipe restrictions in CA, AND I have carefully considered potential economic downsides. The answer is still YES. We should meet on another blog to argue that, and you’re getting me OT, so quit bringing in your other political pet peeves. This isn’t an environment OR automobile industry lobbying blog.

    Further: absent doing anything else, a massive tax increase would probably badly hurt the CA economy, and would not be my recommendation for 2009. See, we can agree on a few things! It’s tough to be a moderate on the issue taxes in CA – people think that if you suggest ANY increase in taxes, however modest, your goal somehow is to get to a 100% tax rate and destroy society. How silly. I pay taxes, too, I don’t think 100% is a good rate. Do you think 0% is a good rate? Probably not, so can we not discuss the best number in between? Could it not possibly be valid if I argue it should 2 or 5% higher than your number??

    If you want to read some of my lengthy comments on Prop. 13 above, you might notice I had a more modest proposal besides repealing it…perhaps you’d like to comment on that specifically?

    The classic problem for state governments vs. federal governments is we can’t deficit spend, which can sometimes be a useful and effective economic tool (though usually it’s overused).

    I think California should have raised taxes more during boom years, and then we could:

    A) Have had more saved up to help us out now (yes, yes, this is in my fantasy world where didn’t just spend it all)

    B) Lower taxes when things go bad – b/c they were high enough that lowering them still covered basic services.

    C) Help to avoid the extremes of the boom/bust cycle. ESPECIALLY IN REAL ESTATE. If we could have raised real estate taxes high enough to slow down the frenzy, we could have ‘popped’ the bubble earlier, raked in some badly-needed cash, and then lower the real estate taxes after the bubble over-corrected downwards to help it get back to ‘normal’ sooner.

    It’s called being prudent, and having all the taxpayers think more long term. Long term thinking is in short supply in Sacramento…

    Instead, the people with money also have power during boom times, and are successful at lowering taxes & spending (e.g, education spending per capita???) during these times, and then the taxes get too low to cut during the Bust. Crisis.

    You may not have encountered a thinking person to debate an issue with in detail before, but I’m a lot more than a liberal environmentalist whacko.

    Bring it on, and try to bring some well though-out, well-expressed points with you.

  32. A. Lewis Says:

    Oops, just read #30 from bg. Full troll warning – this is not just a person I disagree with on a relevant topic, this is an annoying troll.

    I’m not interested in discussing these other political issues here, it’s really lame.

    PLEASE DON’T FEED THE TROLL.

  33. nomadic Says:

    A, here’s something relatively on topic. Regarding your statement (which I know has been made by others here previously):

    ESPECIALLY IN REAL ESTATE. If we could have raised real estate taxes high enough to slow down the frenzy, we could have ‘popped’ the bubble earlier, raked in some badly-needed cash, and then lower the real estate taxes after the bubble over-corrected downwards to help it get back to ‘normal’ sooner.

    How would the absence of Prop 13 dampen bubble pricing? Other than the small % of 1031 transactions, new purchases get slammed with the new tax rate – something I know all too well. That adds another, not insignificant, burden to PITI payments so how does that entice people to overpay?

    Maybe my though processes haven’t re-engaged after languishing all weekend…

  34. Real Estater Says:

    >>If we could have raised real estate taxes high enough to slow down the frenzy, we could have ‘popped’ the bubble earlier

    While we’re at it, let’s raise car taxes, gas taxes, and car license fees so that fewer people can afford cars. That would prevent gloal warming and reduce reliance on Middle East oil. It just occured to me, taxes will solve all problems!

  35. Real Estater Says:

    nomadic says,
    >>Maybe my though processes haven’t re-engaged after languishing all weekend…

    You can start by learning how to spell “thought”.

  36. Real Estater Says:

    bg says,
    >>RBA nut congresswoman Pelosi said that one of the solutions to overtaxed governments in America was to prevent more births from occurring. This can be accomplished with more abortions and contraception!

    But we know better. More births will result in higher demand for real estate, translating to more home construction, and helping the economy.

  37. anon Says:

    “nomadic says,
    >>Maybe my though processes haven’t re-engaged after languishing all weekend…

    You can start by learning how to spell “thought”.”

    Real Estater the editor!

    As smart as he is eloquent.

  38. DreamT Says:

    “Recent polls today also showed that 48% of the country doesn’t believe in evolution.”

    Good thing evolution cannot be repelled by majority voting.

  39. A. Lewis Says:

    #38 – Zing! Nice one.

    #34 RE: way to engage on the issue. Since you wouldn’t, I’ll posit your tax plan: reduce all taxes to zero. That would be best.

    Welcome to anarchy everyone! No taxes = no government. No fire department, police dept., public roads, army, etc.

    I’ll take my posse of armed guards to visit your barbed-wire encampment next week, OK? This message sent by carrier pigeon…

    Do you get the idea I was trying to talk about something in between your response #34 and what I just wrote? Care to engage? Maybe someone else would…

    #33 nomadic: good question. There’s different things I’m talking about: 1) change Prop. 13 to allow greater yearly increases. 2) change Prop. 13 to allow greater assessment in the first place (currently 1% is the limit).

    So using 2): absent other changes, higher real estate taxes on the same property would have a dampening effect on prices as a whole, b/c it makes the entire asset class less profitable. It increases the entry cost and the carrying costs.

    Back to 1) Yes, Prop. 13 is ameliorated b/c new transactions reset the property rates. But there are ways in which it’s repeal would lower prices b/c of both 1) and 2) above.

    Without prop. 13, every homebuyer would be subject to higher taxes in all years after year 1, so it either lowers affordability, or the seller has to lower the price to make it an equivalent value to what it would be under Prop. 13. You could counter argue that it just makes people less likely to buy, but I think it just makes them reprice the asset – the desire to buy is nearly unchanged. I back this up with the list of states that don’t have Prop. 13, and yet, somehow, real estate taxes are bearable there, and many people make money off real estate. Perhaps they just make LESS money off real estate than here in CA. Perhaps lower prices attract LESS evil mortgage brokers and bankers and spineless appraisers who all only make a buck on super-high prices. Maybe that’s fine with me that we have an economy less dependent on that crap and instead on some good or service with real value. The land itself has value, the structure has value and depreciates every day until you renovate it.

    It’s just overvalued, that’s all, partially b/c Prop. 13 gives incentive to hold and not sell. This restricts supply in the already tight areas, and that’s exactly what we have. It also encourages people to become real estate barons b/c it’s an advantaged long-term asset class. I think if you look at any society where a very rich few owned almost all the land, it usually ends in a bloody revolution. Yes, this is me saying I want SOME redistribution of the wealth, in a socialistic way. No, this is not me seeing it all has to be perfectly equal, and that I favor a system where you can’t get rich at all. Can you get the idea that SOME does not equal ALL? I don’t want 100% taxes….

    Back to my point, for long-time homeowners, Repealing (or modifying) prop. 13 gives them a new incentive to sell, and get rid of the property tax burden which will now increase (IMHO fairly) along with CPI. Incentive to sell = more supply, more supply = lower prices.

    Conversely, under Prop. 13, there is incentive not to sell, ever, b/c your tax advantage with Prop. 13 goes up EVERY year, and especially so when inflation is very high.

    Renter’s all know this: it’s why their landlord keeps renting their old place out and has no motivation to renovate it. He doesn’t want to ever sell, so why improve the place? It actually becomes cheaper for him in real dollars to be a landowner every year, and he can raise your rent approximately with CPI.

    In a way, I think Prop. 13 keeps rental rates lower – without Prop. 13, landlords of old properties would need to raise rents somewhat to cover expenses. But they’d also be motivated to renovate the place to keep it attractive at higher market prices.

    Under my plan, the society should get more taxable income from landlords (higher rents), more construction due to more home renovation, more fees from everything associated with more home turnover, more mobile workers who don’t feel chained to their home b/c after 10 years Prop. 13 is too good, better quality housing stock, and lower home prices which can increase homeownership rates.

    I think it would bring the price/rent ratio back to equilibrium by pushing in both directions.

    Of course, I readily admit this is not provable on paper – I’m just saying it’s what I think would happen. I should also say it wouldn’t RADICALLY change anything from how it looks today – it would gradually shift things towards how real estate looks across other parts of the U.S.: pretty normal, you know? It wouldn’t solve our budget crisis, it would help a bit.

    It’s all quite arguable. There’s lots of unforeseen consequences. There’s lots to object to.

    Go ahead object, just lay it out in detail, please.

    Finally, try this argument out:

    We’ve had Prop. 13 since 1978, it was an experiment in real estate, taxation, and public revenue with certain goals. We’ve had it for 30 years, and I think the results are pretty bad.

    I want to try it my way for 30 years, and then we can look back and think a bit about all the pros and cons. Please let me try it my way for a few decades, and I think you’ll like the results.

  40. Real Estater Says:

    A Lewis says,
    >>under Prop. 13, there is incentive not to sell, ever, b/c your tax advantage with Prop. 13 goes up EVERY year

    What this statement implies is that home prices goes up every year. If you believe that, why the hell do you not buy now?

  41. Real Estater Says:

    >>#34 RE: way to engage on the issue. Since you wouldn’t, I’ll posit your tax plan: reduce all taxes to zero.

    I’ve talked about taxes on a numer of occasions. My basic positions are:

    1) Eliminate the AMT.
    2) No tax reductions as part of the stimulus plan.
    3) Long live Prop 13.

  42. anon Says:

    By the way: rents – which have been consistently going up for nearly a year – are starting to abate.

  43. nomadic Says:

    I’ll have to read your reply in detail later, A, but I’d go so far as to propose a relative babystep in reforming Prop 13. The original intent was to keep people from being taxed out of house & home, right?

    So my idea is that it should be for owner-occupied dwellings only. That also would apply to homes where dear old dad kicks off and the kids inherit it. If they move in, fine, they can retain the tax basis. Everyone else goes to market rates, or at least purchase value plus CPI every year.

  44. BuyersAreIdiots Says:

    So my idea is that it should be for owner-occupied dwellings only. That also would apply to homes where dear old dad kicks off and the kids inherit it

    I agree 100% with that idea.

    A great many homes were transferred to children of individuals (trustafarians I call them) without a reset in the actual property tax rate.
    To further exacerbate the issue(or masterbate if you’re Real Excreter), a great many properties were purchased over the years by slum lords who now own a property that costs virtually nothing. There is no incentive to sell the dwelling since it can remain vacant for months on end with little cost to the owner. And lets not forgot all the baby boomers buying up vacation homes and cottages.

    A simple provision to Prop 13 that exempted rentals or second homes and instead only encompassed owner-occupied homes would at least be a step in the right direction.

    In the end however, I think the situation will become too far gone and just simply bleed the state for years on end, probably devaluing property for the next decade as middle income workers leave to places like Texas.

  45. zanon Says:

    All:

    Prop 13 makes houses more expensive, as it essentially keeps average property taxes lower than they would be otherwise.

    Basically, it creates a situation where 70 year olds rent $2M homes to 30 year olds for $2K/mo. Win win!

  46. Justin Sane Says:

    Make prop 13 property tax caps applicable only to primary residences, and allow the rate to reset on inheritance (other than by spouse). That will go a long way to address the lopsided revenue issue of prop 13, and I think such a proposal can garner more than 50% support.

    Yes, I agree that Californian’s problem is mostly spending. Even going, or rather, well into, a recession, Californians voted in a multi billion dollar bond measure to build a high speed rail link between LA and SF. And going another election cycle back, there was the Ahnold supported and politically motivated bond measure that added a few billion dollars to the state’s general debt in the name of stem cell research.

    These things add up, you know.

  47. Justin Sane Says:

    P.S. prop 13 property cap applies to commercial buildings also, which is a real problem.

  48. Real Estater Says:

    YouAreAnIdiot,

    If you know what the rules of the games are, why try to change them instead of taking advantage of them?

    As I stated here before, buying a house is a great investment for yourself and for your future generations.

    It doesn’t make sense that homeowners should pay increasing taxes just to keep what they have. Nobody pays taxes to keep the clothing, the furniture, or the flat screen TV they bought. Tax should only be paid at the time of transaction.

    Some would argue, “Yeah, but you use the city’s services”. Well, those services are used by renters too. That’s why we have income taxes.

    If homes increased in value, then the homeowner would (and should) pay capital gains at the time they sell. Otherwise, why should they be charged on an on-going basis?

  49. Real Estater Says:

    >>Make prop 13 property tax caps applicable only to primary residences, and allow the rate to reset on inheritance (other than by spouse). That will go a long way to address the lopsided revenue issue of prop 13, and I think such a proposal can garner more than 50% support.

    Killing the real estate industry is not the right fix for a recession caused by housing downturn.

    >>Yes, I agree that Californian’s problem is mostly spending. Even going, or rather, well into, a recession, Californians voted in a multi billion dollar bond measure to build a high speed rail link between LA and SF.

    Such measures should never have been brought up for a vote by the general public. The public is not equipt with the expertise to make these decisions, because they don’t manage the government’s budget.

  50. A. Lewis Says:

    Sure, I over-generalized, in some years property values fall, DUH. As I’ve said many times before, I don’t expect property values to fall in general. Over the long term I expect them to track CPI within a point or so. So yeah, some years when property values fall, you would have your assessment actually fall, with or without prop. 13 (it makes no protection for state revenue on the downside – how one-sided!).

    Of course, when you’re under-assessed from market by 80%, if your value falls off 25%, you’re still under-assessed by 55%.

    #48 RE: OK, so you want to go ahead and make the argument for NO property taxes at all. Interesting. I disagree strongly. Anybody want to take this on?

  51. nomadic Says:

    Nope. I stopped feeding trolls and the clueless.

  52. nomadic Says:

    hmmm… I wonder if he realizes that if we abolished property taxes, his own tax bill would have to increase substantially? Probably not or he’d be against the idea. After all, the main Prop 13 beneficiaries are old people will small incomes as well.

    QED – tax the sh*t outta the rich. er, the “rich” income earners. All those rich people with passive incomes can be subsidized by the workers (not just worker bees but anyone who earns a living by going to a job).
    ;-)

    How’s that? Redistribute the wealth to the top and bottom rungs.

  53. nomadic Says:

    with small incomes”

  54. Real Estater Says:

    >>Sure, I over-generalized, in some years property values fall, DUH.

    and yet you capitalized EVERY year.

  55. bg Says:

    The only clueless trolls here are those who say, “Prop 13 must be repealed” over and over and over again.

    These same trolls blame the state’s current financial mess on Prop 13 and they NEVER bring up other factors like the Democrat legislature expanding the roll of government into every aspect of life, runaway government spending, the cost of dealing with illegal aliens, the horrendous cost caused by giving state employees solid gold retirement and medical benefits (not to mention their high salaries), or any of the other numerous examples of a state government that is out of control.

    These same trolls also blame their problems on the baby-boomers who “mortgaged” their children’s future away. These selfish boomers had it easy and the boomers parents even had it easier–they could go to school for free and buy houses in the RBA for $12,000.

    Yes, life is so unfair!

  56. DreamT Says:

    “If you know what the rules of the games are, why try to change them instead of taking advantage of them?”

    Personal ethics?

  57. Real Estater Says:

    nomadic says,
    >>I wonder if he realizes that if we abolished property taxes, his own tax bill would have to increase substantially? Probably not or he’d be against the idea.

    I can tell you either way it doesn’t affect me. Each year, my entire tax payment is due to the God-damn AMT. I don’t have any other tax oligation as everything is perfectly sheltered.

  58. anon Says:

    “>>Sure, I over-generalized, in some years property values fall, DUH.

    and yet you capitalized EVERY year.”

    Dearest A. Lewis,

    I trust you have been well; it has been over a fortnight since the passage of the new year. I understand you are still chasing Alice down the rabbit hole and would like to let you know that I am concerned for you. The path to find Alice is fraught with danger, and, in the course of your travels you may encounter the snake demon, real estater. In the event you should have the misfortune to encounter the aforementioned demon, I wish to provide you some advices. The snake is not immune to its own venom. Aside from avoiding eye contact, it’s important to never admit that you are wrong. If you present an argument or a rationale and the snake latches on to a specific statement which may or may not be consistent, it is best to elect not to respond. You will find that this is exactly what the snake does. You can never get anywhere with the snake, as the snake has no ability to learn.

    Also, remember, when the snake throws up a cloud of smoke you must stay strong and steadfastly pursue your goal. Remember: you have more important things to do. Like find Alice.

    Please send telegram if you have made any further progress in your searches.

    Sincerely,
    Anonymous J. Throckmorton III

  59. FredinCA Says:

    YouAreAnIdiot

    Geez, you have no imagination. He comes up with a great nickname that is a play on words of your moniker, “Real Excreter”, and THAT is the best you can come up with??

    Looooooo-ser!

    And in regards to this statement:

    It doesn’t make sense that homeowners should pay increasing taxes just to keep what they have. Nobody pays taxes to keep the clothing, the furniture, or the flat screen TV they bought. Tax should only be paid at the time of transaction.

    That is a play towards a flat tax system. And that is fine. The problem is, Prop 13 is NOT a flat tax concept; it is a cheater way for individuals that got in early to get a free ride.

    Why should those that did nothing other being born earlier have a tax advantage over those that arrived later?? Not to mention that in order to compensate for the skewed property tax revenue, those that arrived later ALSO have to pay higher income taxes! The system is completely skewed towards burdening subsequent generations and that is totally unfair.

    You want a flat tax, fine. Enact one! But do not create some hybrid tax structure that favors a whole slew of people at the expense of others.

  60. Lionel Says:

    Bye bye, tech.

    http://www.ritholtz.com/blog/2009/01/how-bad-are-tech-earnings/

    1. PC DEMAND IS SUFFERING big time. Microsoft and Intel are both cutting jobs; Advanced Micro Devices (AMD) posted a 33% drop in profits; Disk-drive maker Seagate ’s (STX) revenues were down 34%; Logitech (LOGI), reported a March-quarter miss.

    2. MOBILE-PHONE SALES are in trouble. Nokia (NOK) reported a 19.5% Q4 revenue decline; Warnings were already out from Motorola (MOT) and Sony Ericsson;

    3. CONSUMER-ELECTRONICS demand is non-existent. Sony (SNE) expects a loss for its March 2009 fiscal year. GPS device maker TomTom (TOM2.AE) issued an earnings warning; and Foxconn International (2038.HK)

    4. THE CHIP BUSINESS CONTINUES to erode. Taiwan Semiconductor (TSM) reported a 31% Q4 earnings decline. MEMC Electronic Materials(WFR) sees March-quarter revenues down 50%; Marvell (MRVL) sharply reduced its Q4 guidance.

    5. EVEN THE GOOD EARNINGS REPORTS aren’t so good. IBM’s Q4 revenues actually missed by more than $1 billion, dropping 6%, and their full-year profits reflect cost cutting, not top-line growth. Apple (AAPL) exceeded both top line and perofit expectations, but iPhone sales disappointed, falling 36% from Q3; desktop Mac sales were weak, and Apple same-store sales were down from last year. Google (GOOG) beat estimates, but concerns as the ad market continues to soften.

  61. Real Estater Says:

    FredinCA,

    Apparently you don’t understand the meaning of a flat tax system. I’ve never objected to the rich paying more; my objection is to paying over and over again for the same transaction.

    Those born earlier do not have an advantage. They paid their portion of taxes based on the amount of their transaction at the time. The same is true for any new home buyer.

    A person who inherited a property should not have a reassessment of property taxes, because there is no buy/sell transaction taking place.

  62. Real Estater Says:

    If grandma bought a car for $3000 in the 70′s, does it make sense for her to pay 10 times more taxes to keep her car because cars cost 30 grand now days?

    Without Prop 13, senior would be forced out of their homes in retirement because they have no income at that time. In other words, the American dream will become the American nightmare because it is mandated by law. Who will bother to work toward the American dream anymore?

  63. anon Says:

    Lionel,

    More bad news…

    http://www.nytimes.com/2009/01/27/business/economy/27layoffs.html?ref=business

  64. A. Lewis Says:

    #56 DreamT – YEAH! That’s what I’m talkin’ about. That’s what I’m saying. The cheaters find a loophole and exploit it, hoping neither to get caught, nor to let too many others in on the secret. The cheater-detectors try to close the loophole.

    #58 anon – LOL, thanks. You know there was that I post a while back where I said I wouldn’t give up on him…I feel a little guilty when I ignore him. And I try to avoid generalizations and pick up on as many holes in my own arguments (and pre-refute them) as possible.

    Other times, he just give me an opening to make more and better points, and I can’t resist.

    But in general, I should try harder to follow your advice. I have been trying.

    #59 FredinCA nice post. Good summary. How on earth you people manage such brevity is beyond me.

    I have a lot of acquaintances also pained by the AMT. Here’s the only change I would make to the AMT: the cap level should move with CPI (like everything else). If they didn’t alter it ever, in 50 years or something people at the federal poverty level would pay AMT, and that’s neither the intent nor spirit of the law.

    Having said that, the AMT is totally fair and a good idea. It’s a catch-all loophole closer. If you’re upper-middle class or richer, and you’ve found so many tax shelters and loopholes you don’t pay anything to support the rest of society that you enjoy, we’ll make sure you pay a modest share.

    Anyone with earned income over $100k a year who figures they ‘deserve’ to pay no taxes should be forced to A) pay taxes (oh goodie, we have that law), and B) be forced to listen to me give ethics lessons for hours on end every Saturday until they crack and admit they were greedy and they’re sorry and they just want to go out and help the poor people now, if please God would I just stop talking.

    Maybe I should sum up all of my philosophy on this blog with “Greedy people suck”.

  65. A. Lewis Says:

    CalculatedRisk adding more value to the discussion:

    See this post for a great long-term overview of Existing Home Sales, following on this morning’s postings:

    http://www.calculatedriskblog.com/2009/01/annual-existing-home-sales.html

    And I want to highlight this statement, made last year by CR, which he repeated today b/c they’re still true:

    The turnover rate was boosted in recent years by:
    # Speculative buying (flippers).
    # Speculative buying by first time home buyers (using excessive leverage).
    # Move up buying, especially by Baby Boomers.
    # and recently by investors / first time buyers buying REOs.

    The turnover rate is still above the median for the last 40 years and substantially above previous troughs. Both types of speculative buying is now over. And the Baby Boomers have probably bought move up homes, and the next major move will be downsizing in retirement (still a number of years away). And although REO sales will continue to be significant in 2009, they will probably slow some as foreclosures move up the price range.

    And finally – and probably a very important point – homeowners with negative equity, who manage to avoid foreclosure, will be stuck in their homes for years. This suggests the turnover rate – and existing home sales – will decline further.

    Exactly.

  66. A. Lewis Says:

    Demand destruction = lower prices.

  67. FredinCA Says:

    Apparently you don’t understand the meaning of a flat tax system. I’ve never objected to the rich paying more; my objection is to paying over and over again for the same transaction.

    I actually understand it quite well. The issue here is that Prop 13 is NOT a flat tax based concept from the standpoint of a single transaction.

    On the one hand, you say you don’t think individuals should be paying taxes for something they already own and on the other hand, you support Prop 13 which does EXACTLY that! The only difference is it gives an unfair advantage to those that arrived early enough to benefit from it.

    And all the talk in regards to the seniors is a strawman argument. It would be extraordinarily easy to simply provide a grandfather provision to allow those on fixed incomes to maintain their current property tax rate. Problem solved. And for the rest? Free lunch is over. Pay up or hit the road.

    Personally, I actually think property taxes are not a bad thing. Look at states like Texas that have higher property taxes but no income tax. How does their budget compare to ours? How about their road system? Their schools? All superior. Highly vaulted California gets the wonderful distinction of being 49th out of the 50 states in regards to our school system. When PRIOR to Prop 13, it was numero uno!

    Way to go dumbasses.

  68. DreamT Says:

    Dear A.,
    Keep at it and you’ll get carpal tunnel syndrome.
    Now you wouldn’t want to be PHYSICALLY reminded of RE’s ethical lapses every time you sit in front of a keyboard?

  69. Herve Says:

    This house reminds me of the one featured on Dec 31st last year (which seems to be sold by the way).

  70. Real Estater Says:

    FredinCA Says:
    >>On the one hand, you say you don’t think individuals should be paying taxes for something they already own and on the other hand, you support Prop 13 which does EXACTLY that!

    To clarify, I don’t think property tax should exist period. If we must have property taxes as a necessary evil (because the government can’t handle its finances), then we need to minimize it to the extent it does not destroy the American dream. If I bought a property for 30K in the 70′s, I should be taxed based on 30K, not based on the 700K market value today, since that’s not what I paid. This is the same rationale applied to everything else we buy. If you buy a suit from Macy’s, you don’t keep paying more and more in taxes because Macy is raising the price of the suit. That’s a completely laughable, nonsense argument you’re making.

  71. nomadic Says:

    A said: This suggests the turnover rate – and existing home sales – will decline further.

    The macroeconomic chip on my shoulder would say that a lower turnover rate means less supply. Leading to upward pressure on prices.
    :-)

  72. FredinCA Says:

    If I bought a property for 30K in the 70’s, I should be taxed based on 30K, not based on the 700K market value today, since that’s not what I paid. This is the same rationale applied to everything else we buy. If you buy a suit from Macy’s, you don’t keep paying more and more in taxes because Macy is raising the price of the suit.

    And as mentioned by others when you used this idiotic comparison before, this is a poor analogy.

    A better analogy would be something like the following:

    I started working in 1978 and paid X dollars in income taxes since. Over the years my salary has increased, but I want to pay the SAME tax I paid back in 1978. Now does THAT make sense??

    Or how about this one:

    I bought a car in 1978 and paid X dollars to register the car. Now, many years later, I want to pay the SAME amount I paid in 1978 when re-registering it. Make sense? Uh, no.

    But those are the true analogies that demonstrate the absurdity of Prop 13. Subsequent generations have to incur the tax burden for the deferred tax revenue that Prop 13 actually created for those that got in early. And they do so with BOTH property taxes AND income taxes. And we still have a $42 billion deficit. And your logic is that a simple AMT adjustment and reduction in services will clear $42 billion from our balance sheet??

    Apologies folks. I know I am feeding the troll here. But I just want to get the point across for those others that might frequent this blog and come across Real Excreter’s moronic logic.

    So I digress.

    Peace.

    P.S. BuyersAreIdiots: I friggen LOVE that nickname you gave to Chuck. Beyond hilarious! :-)

  73. DreamT Says:

    RE – Your argument is specious. Property tax is an assessment on the use of the property rather than on its acquisition. It’s the equivalent to paying rent to the county, because you don’t _truly_ own the land, it ultimately belongs to your country. To your argument that renters should then pay an equivalent because they use the same services, it’s the tax-it-twice situation you just deplored (since the landlord already pays). Hopefully you weren’t serious to suggest exempting landlords with tenants and have the renter pay instead. This would radically increase the wealth gap well beyond what it is today.

  74. nomadic Says:

    Hopefully you weren’t serious to suggest exempting landlords with tenants and have the renter pay instead.

    Of course that’s what he meant. His goal is to pay zero taxes. To hell with everyone else as long as he “gets his.”

    Ultimately renters would be paying anyway – the landlord will pass on the expense via rent. That seems fair enough really. I wouldn’t advocate LLs subsidizing rents.

  75. DreamT Says:

    nomadic – I don’t think the tax expense is part of the rent equation. Generally, whatever the market will bear, the landlord will ask as base rent, necessarily and irrespective of the current year’s tax payment. The penalty would be not getting a renter!

  76. R Says:

    “RE – Your argument is specious. Property tax is an assessment on the use of the property rather than on its acquisition. It’s the equivalent to paying rent to the county, because you don’t _truly_ own the land, it ultimately belongs to your country.”

    Ding, ding, ding, ding. Exactly correct, DreamT.

    “To clarify, I don’t think property tax should exist period.” Of course not, since it serves as a barrier to home ownership thus reducing total real estate transactions and total sales commissions “earned” by realtors. But while we’re at it, let’s just eliminate capital gains, income tax, and sales tax. Who needs tax revenue when you can just keep issuing bonds.

  77. Real Estater Says:

    FredinCA Says:
    >>Look at states like Texas that have higher property taxes but no income tax.

    That kind of structure is essentially a transfer of wealth from property owners to support the general population. No wonder home prices in Texas doesn’t go up. California does not aspire to be a wealfare state. If that’s what you want, move to Texas.

    >>Highly vaulted California gets the wonderful distinction of being 49th out of the 50 states in regards to our school system.

    Useless aggregate data. High quality education is readily found throughout the RBA. California also has the best public university system in the country.

  78. Real Estater Says:

    FredinCA says,
    >>A better analogy would be something like the following:

    I started working in 1978 and paid X dollars in income taxes since. Over the years my salary has increased, but I want to pay the SAME tax I paid back in 1978. Now does THAT make sense??

    Your example makes no sense. Say you worked in 1978 and made $30K. In 2008, you worked and made $100K. These are two different disbursements of salary. With the house, it’s still the same damn house! Would you get taxed again in 2008 for the work that you did in 1978?

    If I did buy a house in ’78 for $30K, and another house in ’08 for $700K, then I’m all for paying taxes for both houses based on the respective amounts.

    >>I bought a car in 1978 and paid X dollars to register the car. Now, many years later, I want to pay the SAME amount I paid in 1978 when re-registering it.

    This one is even funnier. Have you ever registered a 1978 car? You would definitely not pay the same amount you paid in 1978. You would pay A LOT LESS!

  79. Real Estater Says:

    >>“RE – Your argument is specious. Property tax is an assessment on the use of the property rather than on its acquisition. It’s the equivalent to paying rent to the county, because you don’t _truly_ own the land, it ultimately belongs to your country.”

    LOL. Check your passport. This is not the People’s Republic of China. I have a deed to the land. Real Estate 101.

  80. madhaus Says:

    Well, I was going to say something about today’s house, but I got misdirected by the Prop 13 wars. Yeesh.

    Remember, when you feed a troll, not only does it follow you home, it won’t let you cross the bridge to the 21st century!

  81. Real Estater Says:

    DreamT says,
    >>Hopefully you weren’t serious to suggest exempting landlords with tenants and have the renter pay instead.

    You’re making things too complicated. I already said nobody should pay a property tax. Everybody uses these basic services, so the money should come out of income taxes, which everybody is already paying.

  82. Real Estater Says:

    madhaus,

    Why is it every time we get into a substantive discussion, you come out with the troll charge? If this subject is beyond you, then just stay on the sideline.

  83. madhaus Says:

    On the sideline? Is that where you think I should stay?

    Where all the cash is?

  84. steve Says:

    against madhaus’ sage advice, hey RE, how about this?

    treat real estate like stock, so no property tax but also no special capital gains exemptions, no home interest deduction and no government backed/subsidized mortages.

    the elimination of property will choke off funding for local services (that’s good, right? who needs, police, fire, schools, building inspectors, …), but if necessary we’ll make it up in state income tax. that way East Palo Alto and Palo Alto can now get funding identical amounts of per capita funds from the state.

    I’ll support this, and based on your previous posts, seems like you should too. But, how would your neighbors feel about their investment? much of what makes nice cities nice is tied to property tax.

  85. Real Estater Says:

    >>CONSUMER-ELECTRONICS demand is non-existent.

    Does anyone believe that? I just bought a camcorder. My GPS, PDA, flat screen TV, Wii, Playstation 3 are all less than a year old.

  86. DreamT Says:

    “LOL. Check your passport. This is not the People’s Republic of China. I have a deed to the land. Real Estate 101.”

    What a dorky response.
    Who issued the deed and maintains its validity? Who has sole authority to override it by appropriation, raze it if wished? Who has authority to use police force and break in? Hint: it’s not China’s government.
    As for my passport, it does not contain your deed nor its conditions of legal application. I’ll just assume you meant “Check my passport”. Send to DreamT c/o Burbed, and I’ll have a look.

  87. DreamT Says:

    “You’re making things too complicated”
    Fortunately I’m not posting only for your benefit. Others can follow just fine.

  88. Real Estater Says:

    steve Says:

    >>treat real estate like stock, so no property tax but also no special capital gains exemptions, no home interest deduction and no government backed/subsidized mortages.

    No property tax so no property tax deduction, that’s not a problem. I’m actually saving the government some money. It’s a win-win.

    They already took away the capital gains exemptions for non-primary residences.

    I would also support no government subsidized mortgages.

    >>the elimination of property will choke off funding for local services (that’s good, right? who needs, police, fire, schools, building inspectors, …), but if necessary we’ll make it up in state income tax.

    I already said that. The money should come out of state income tax. If they need more money, raise the income tax for everybody, instead of just asking homeowners for money.

    >>But, how would your neighbors feel about their investment? much of what makes nice cities nice is tied to property tax.

    Property tax is paid to the County, not to the city. If Property tax is actually paid to the city, it would be a lot more reasonable.

  89. DreamT Says:

    “My GPS, PDA, flat screen TV, Wii, Playstation 3 are all less than a year old.”
    You meant these are your “well rounded” kids’, right? I can’t imagine you find time to spend on Wii and Playstation 3 between two postings on burbed – you’d have to pause every ten minutes.
    In any case, this sheds light (and some pounds) on the “well roundedness” of your kids.

  90. Real Estater Says:

    DreamT,

    I actually do play those games with my kids. Studies have shown game playing can improve mental sharpness and dexterity, so I have no problem with kids playing games as long as the time is controlled.

  91. DreamT Says:

    You actually check studies to figure this out? How old are you again?:)

  92. madhaus Says:

    Now now, DreamT. Please don’t let Roger Chuck find out that Chuckie, Jr. is posting after bedtime.

  93. SanMatean Says:

    How ’bout we introduce a gradual increase in the cap % of annual property tax increases? Today it’s set at 2%. There is no reason it couldn’t be adjusted to 2.5%, 3%, or heck, maybe even 4%.

    The original intention of Prop13 was to keep retirees from losing their homes during spikes in property valuation (As happened in the 1970s during rampant oil-shock induced inflation). You have to admit, there is something ugly about retirees being forced to sell their home because of a skyrocketing property tax bill.

    I’ll bet that any effort to amend prop13 will be more successful than those intended to eliminate it.

  94. nomadic Says:

    Property tax is paid to the County, not to the city. If Property tax is actually paid to the city, it would be a lot more reasonable.

    Sure, but you’re paying for more than just services in your tiny locale. However, at least in LG, nearly 10% of property tax revenue stays in town. With valuations higher than neighboring areas that provides an advantage.

  95. nomadic Says:

    Oh, I left out an important detail above. The % of tax going to the city is just for the city. Then there’s schools…

    In your beloved Palo Alto, 56% of property tax goes to the schools.
    http://www.cityofpaloalto.org/civica/filebank/blobdload.asp?BlobID=2779

  96. anon Says:

    “>>CONSUMER-ELECTRONICS demand is non-existent.

    Does anyone believe that? I just bought a camcorder. My GPS, PDA, flat screen TV, Wii, Playstation 3 are all less than a year old.”

    This is precisely the point. What consumer electronics do you plan on purchasing in the foreseeable future?

  97. BuyersAreIdiots Says:

    FredinCA Says:
    >>Look at states like Texas that have higher property taxes but no income tax.

    That kind of structure is essentially a transfer of wealth from property owners to support the general population. No wonder home prices in Texas doesn’t go up. California does not aspire to be a wealfare state. If that’s what you want, move to Texas.

    ROFLMFAO!!!!!!!!!!!!!!!!

    So let me get this straight: California doesn’t aspire to be a welfare (sic) state while Texas does???

    Texas? Red Texas?? Versus bleeding heart liberal California??

    Mwaaaaaaaaaaaa ha ha ha ha ha!!!!!!!!

    Real Excreter, you need to take your act on the road. Comedy that funny is rarely free!

  98. anon Says:

    LOL – I missed that one. Good point buyersareidiots.

  99. Prof. Bleen Says:

    Of course, when you’re under-assessed from market by 80%, if your value falls off 25%, you’re still under-assessed by 55%.

    Hang on…I take “under-assessed by 80%” to mean the your home is worth five times the assessed value (i.e., the value on which you’re paying taxes). Am I right? If not, then please ignore the following: If your house then fell in value by 25%, it would then be worth 0.75 × 5 = 3.75 times the assessed value, which means that it would be under-assessed by about 73%.

  100. madhaus Says:

    Prof Bleen, please stop with the difficult math. Nobody here can even figure out the difference between a 7/1 jumbo ARM and a 10 year fixed conforming. (Hint: the former should have been bought in 2006, because it’s got a balloon that goes with the bubble.)

    Meanwhile, I am anxiously awaiting what consumer electronics Roger is going to buy, since he, and he alone, is going to save the entire region from economic disaster. Don’t you need to buy a new high-end digital camera or something? That ought to save someone’s job at Keeble & Shuchat for at least three hours.

  101. Herve Says:

    Prof. Bleen, go easy on maths. I only read 42% of your post.

  102. burbed Says:

    Can someone explain the formula for how much property tax stays in a city?

  103. madhaus Says:

    Yes.

  104. nomadic Says:

    here you go, burbed. I’m not gonna read it and summarize though. ;-)

    http://www.csac.counties.org/images/public/Advocacy/rev_tax/Demystifying%20the%20CA%20PT%20Appt%20System%20May%202006.pdf

    I think what you’re looking for will be in there somewhere. I do see that tax rates were downright evil before Prop 13. Nothing like going from one extreme to another.

  105. nomadic Says:

    Tax rate overview for CA, as well as the votes required to change things:

    http://www.lao.ca.gov/2006/cal_facts/2006_calfacts_state_local.htm

    Go a little more than halfway down for the pie chart and data about how much property tax goes to cities. Clearly this is aggregate data since we know that the Kingdom of Specialness keeps a larger portion.

  106. anon Says:

    It does. In fact, residents have voted extra taxes on themselves to support the schools.

  107. Real Estater Says:

    madhaus,

    Money on the sidelines are working hard now:

    The Case-Shiller index doesn’t capture sales volume, but separate national and local studies released in recent days both showed significant gains, as investors and normal buyers seize the bargains created by widespread foreclosures and building economic pressures.

    A total of 5,171 existing homes in the nine-county Bay Area changed hands in December, about two-thirds more than in the previous year, San Diego research firm MDA DataQuick reported last week.

    Source: SF Chronicle

  108. Real Estater Says:

    nomaidic,

    The info you’ve shown us demonstrate that property tax is bogus. If you look at all the different ways the money is spent, it’s totally unfair to ask property owners to pay the bills. Everyone in the community makes use of those services, regardless of whether they own or rent.

  109. anon Says:

    Not only that, people can come from other places to take advantage of the amenities that the local property taxes support. The boundaries – high prices – don’t seem to prevent soccer players from coming to PA and using their parks.

    Life’s so unfair.

  110. anon Says:

    http://googleblog.blogspot.com/2009/01/announcing-googles-employee-option.html

    Google… Admitting their own stock is underwater.

  111. Prof. Bleen Says:

    Did you know that Texas has its own version of Prop 13? It’s called the homestead exemption. Get this:

    What is a homestead tax ceiling?

    It is a limit on the amount of taxes you must pay on your residence. If you qualify your home for a 65 and older or disabled person homestead exemption for school taxes, the school taxes on that home can’t increase as long as you own and live in that home. The tax ceiling is the amount you pay in the year that you qualified for the 65 or older or disabled person exemption. The school taxes on your home may go below the ceiling but not above the amount of the ceiling.

    Anyone—not just seniors and the disabled—get a “homestead exemption” of $15K. Some welfare state, huh?

  112. Prof. Bleen Says:

    nomadic says,
    >>Maybe my though processes haven’t re-engaged after languishing all weekend…

    You can start by learning how to spell “thought”.

    Heal thyself, Mr. Wealfare [sic] State.

    Keywords: pot, kettle, black

  113. nomadic Says:

    LOL, Bleen.

    We have a $7,000 Homestead exemption in CA. I always wondered why they bother.

  114. madhaus Says:

    Yeah, you would think they ought to double that every ten years.

  115. Herve Says:

    Reduced to $475K.

  116. Herve Says:

    Reduced to $374,900.

  117. Herve Estater Says:

    It’s pending now!

  118. Herve Estater Says:

    > the regulars like for the new readers to go to new threads while we slug it out in the older ones.

    Speaking of which, the house is back on the market and reduced to US$359,900 (as opposed to Florence Italy dollars). Good location for quick sale according to the listing!


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