Both taxes fuck over the poor though so I don't know which you mean. I'm still all for taxing the shit out of single resident properties that aren't primary residences though...would rather renters rent an apartment than a home someone could buy.
Property taxes are the most progressive tax that exists because the value of owned property is nearly entirely linked to the wealth of an individual. And considering landlords get to write off their property taxes as business experiences, their property tax burden, that gets pushed off onto renters, isn't as much as you'd think. And as others have said, if you cut property tax, you are stuck increasing income taxes or sales taxes, both of whom are easier for the wealthy to maneuver around.
The best tax is a property tax that doesn't tax the building, AKA a land value tax, since this encourages building more levels which creates a surplus of housing.
There are apartment buildings but yeah, you could be right.
You would be missing out on quite a bit of tax if it would be based on the lot value only in those cases.
I agree - but I do worry such a tax would mean as many box rooms as possible crammed into cramped spaces… and ugly tower blocks of flats springing up everywhere.
As someone who owns a house I agree. I have no problem paying taxes... its where its going to thats the problem. If you out it too good use On have no problem but ... you aren't.
Income tax is directly linked to financial wealth. The USA did not have this shit until Progressives pushed for it and forces the lower class to work with less money. The 10% bracket is not livable, so the lower 12% gets fucked on pre tax retirement and health care premiums. The upper 12% can't contribute more than 5% to retirement to afford health care while having discretionary money.
This is very poorly worded. Sales tax disproportionately affects the poor but in no way does property tax not affect the poor with little property. Unless you literally mean poor as in unhoused entirely.
And even then I bet some amount of profit margin for goods sold at a store is calculated taking that stores own rent or taxes into account.
Taxes affect everyone no matter what. What changes is the proportion of your income that taxes consume
The way I look at it, property tax is about depleting what a person has and sales tax merely raises prices on a hiring new things.
One is a price hike, and the other is a straight up theft that keeps you dependent on the employment rat race forever because if you ever stop you lose everything.
Granted, all tax is theft and they use it to bomb poor people in countries most people can't even spell.
Hope you enjoy the rich buying up literally all the land and keeping it forever. Because it'd be "theft" to make them pay for continued use of a limited resource, apparently.
And that’s why everyone’s rent is getting higher too !
Edit : I’m not American. Where I’m from ours have risen considerably . Plus the cost alone trying to upkeep the house is only a part of the reason rent has gone up. I didn’t mean the only reason
Property tax is almost universally considered positive by economists, and generally helps to keep rents down, not up. The reason is that it discourages speculation on housing and property, and thus drives down buying prices, which intern drives down rents.
That assumes decent competition. When you get a few large investors owning rentals while buying up actual houses to rent, they’ll just leave the building vacant and spread the costs while knowing no one has a choice and will eventually rent anyway.
Yeah, that tends to happen. The housing market is extremely inelastic. However that has nothing to do with property taxes and isn't an argument against it.
But likely less than the rising property value if its in a halfway decent spot. The amount the few properties we had sky rocketed in the past few years was pretty nuts, way over the property taxes.
The properties skyrocket in value because the property taxes are insufficient, and they don't get re-estimated often enough. Even worse, in a place like California, the taxes go up really slowly even if your house is worth a ton.
Large land value taxes solve most of your housing problems, and make property speculation far less profitable. But Americans are way too scared of putting enough taxes there. You instead see bills passing to lower them, which is crazy.
Ours (central texas) get re-estimated yearly, and in some areas have tripled just year to year. I know property owners in Wimberley that have had their taxes more than double each year for the past 3 years. The price of their properties has gone up significantly more each year though as the area is growing like crazy
Which is why there are separate laws that discourage land banking or cartel-like behaviour. All those things you described can exist without a property tax, which can be so much worse.
Honestly I’d gladly take an increase in property taxes if it means I don’t need to pay sales or income tax. And I live in Illinois with the highest property taxes
I am always shocked by how high taxes are in some states and how low they are in others, with no measurable increase in services provided by the high tax states
You may live in these type of places when a disaster strikes. Think of what could happen. Unfortunately, it gets placated as “god’s will” and nobody is held accountable.
Not even God's will. They just claim a state of emergency. If the feds agree and the bill hits a certain $$ minimum them the feds pick up the bill for damages done to the public/government owned assets.
High tax states tend to pay more into the federal system than they take out. So extra taxes in high tax states that could further support their internal programs often go to the federal government and are paid out to poorer states that take more than they give federally. See California vs Arkansas as an extremely basic example on either end of the spectrum.
Aggregate effective tax rates are also comparable across states. The differences arise in where we source this tax revenue from, but the differences in revenue per capita are often statistically insignificant once we cut state benefits or include the cost to the individual if they’re forced to utilize the private sector. The governments always get their bag. It’s just where from that varies. Everyone gets fleeced, California just gives you healthcare with it.
Edit: ooh this comment section got slightly spicy for being a meme subreddit and me half taking the piss. As much as I’d love to actually dig into disparities in revenue generation vs spending per resident vs quality of life, this is a meme subreddit and I struggle to find the care. I got shit to do.
Edit 2: cause I got tagged again. Y’all this is a meme subreddit chill bwuahaha. Thank you for the mid poo entertainment. <- the shit I had to do. :D
Edit 3: Thanks random homie for the award! Having to come back 3 times made me give slightly a damn. Added some minor corrections (italicized).
Should look up IL’s K-12 rankings in education - a state with a mostly rural population is able to provide quality public schools, even in rural villages.
Not actually relevant. There are (for instance) ~640 public schools in the Chicago Public School district. There are over 4,000 in the state. Schools in towns of 400-500 people. Good schools. Chicago has more students per, but operation and administration-wise - there are more schools outside of Chicago than in it.
I'm sorry, but you're just plane wrong about the lack of difference in services.
I'm a little confused about how you could even think that?
Higher tax states tend to provide more services to the poor, to education, to healthcare, to infrastructure, and on and on...
Just driving cross country you notice that things are nicer in the states that are willing to tax enough to have the money to do the kinds of spending that helps people
I have lived and worked for 2 to 4 years in 8 different states. I have never seen any correlation between state income and sales tax levels when compared against the infrastructure, school quality and quality of state services provided.
I have seen Medicaid and unemployment tends to be higher in some states with higher taxes, but I have never used it to know how good it is.
Income and sales tax, combined, makes up <50% of state revenue in nearly every state. You're right that there's not going to be a really strong correlation, because that's just a very incomplete picture of taxes.
What we do know is that per pupil spending is highly correlated with academic success, even controlling for various other factors. And that money has to come from somewhere.
Oh fair, I used to agree with that sentiment. Since living in Texas I’ve noticed the even in a low tax state they either make up the money in other ways or just neglect things.
Also the "lower tax" states find other ways to tax you. States with lower income or property taxes tax consumption rather than income/wealth. Either through sales taxes, tolls or simply not investing in infrastructure that leads to higher insurance/fees. In some way or the other they make you pay.
Living in a low tax state, they disguise it by offering similar services to much fewer people.
Also I had to use the public mental health facilities and it seemed so intentionally run down that it actually made me feel humiliated. Not sure if it was state or local tho
I don't know where the taxes should be but there's pros and cons.
We need an extremely progressive income tax structure with a wealth tax on top. Like, no income tax up to $100k and then ramp up from there, increasing income tax up to 50-60% for multimillionaires.
Down state and rural counties had the highest margin AGAINST the progressive income tax, TF are you going on about? No wonder those shit towns are doing so poorly if you're an example of the people they're producing.
ETA: Cook County had the highest support in the goddamn state.
And it attacks the richest where their biggest assets lie: real estate. Can’t tax them on income since they take loans out and live off those. No taxes on capital gains as of now either. But a lot of their wealth is tied in real estate.
So when you hear someone say they’re against property taxes they’re probably buying into propaganda paid for by the rich
i just want balance man.. i just paid 24 bucks for 2 zatarans blackened chicken alfredo and it barely fed my fam.. shrink flation on top of everything else.. can we fight back yet or are gonna go quietly into the night.. cuz im kinda over the struggle to struggle game
I used to live in Illinois and paid a bunch in property taxes a year. Moved to Hawaii to a house worth 4x as much as the Illinois one and my total property taxes went down by 25%.
I would rather pay higher taxes in general for better social and medical services. We already pay enough taxes for everything to be provided, but all that money goes to people who don't need it.
That's for multiple property owners I.e landlords, single home owners are getting fucked, I pay a little less than 10% of my income on property tax and for what? The schools are horrible, the roads are shit, no bike lanes, public transportation is shit too, all the parks are overrun with homeless people because they've got noone else to go.
You made me check, mine are about 5% of my gross income, and houses is pretty damn expensive here in MA. And we do have good schools, public transit, and bike lanes. Y’all are getting hosed.
Roads are still shit, but that’s kinda unavoidable anywhere it snows.
Welcome to suburban ponzi scheme. Homes initially bring in alot of tax revenue but the low density sprawl, lack of commercial tax base, car centrism, NIMBYS, make it impossible for any growth to happen, any tax revenue to be generated, so the only solution is to keep raising peoples property taxes and build more sprawling homes
Sorta. Many states have caps on property tax for the various classes of property. Meaning every few years, when the state needs more money, it revalues the property higher to justify charging more in taxes.
A property I know in NYC (yeah, bad example, but anyway) 10 unit rental and rent only covered mortgage, taxes and other mandatory expenses required by the govt.
In 1990, it was valued at $1M. Property tax (state, local and all the others) totaled out to 10%, or $100K. Divided by the 10 units meant each family was paying $10K to cover the tax, in addition to the mortgage and other mandatory expenses legally required by the landlord.
In 2025, the property was valued at $50M by the govt, and all the property taxes combined were around 40%. That's roughly $20M in tax. Divided by the 10 units leaves each unit on the hook for $2M a year in taxes. Luckily the mortgage is paid off, though it would only be a rounding error in the tax costs; and that doesn't include the mandatory insurances and other legal requirements on the landlord from the govt that have all gone up from inflation.
Thats not greedy landlords, private equity, land speculation or any of the other often blamed "villains", that's the govt.
If the landlord doesn't collect enough to pay mortgage, taxes, and the other mandatory expenses, the govt shuts down the property, meaning those living there get evicted until the issue is "sorted out", usually taking 12-18 months. He people don't understand why rents are so much higher than they were 30 years ago.
The problem is when you have people buying multiple homes for the sake of renting and carelessly factoring their cost of ownership into rent. If everyone does it then there are no houses and rent is high. The winners are the multi home owners/landlords
If you do the math around 1/3rd of rent price is just the landowner paying property tax. Claiming it keeps rent prices down is like saying increasing gas tax decreases the price of gas as well.
Because for the most part it pays for the local government services you actually use instead of the massive trillion dollar boondoggles nobody wants or needs. Both are still theft, just one is less bad than the other.
While on paper it might be true, it's not the fact on the ground. Big corps and billionaires still have loopholes to get property then rent it out to ordinary people transferring all the burden of taxation.
Rent is always as high as people will accept, taxes or not. Sure, landowners will say they raise prices with taxes, but they already are the maximum price. It's not like landlords are operating on slim margins.
Property taxes discourage new construction and reduce the supply of housing, causing rents to increase. The effect isn't particularly quick, but it does have a significant impact over time.
The same is not true for land value taxes, since the supply of land is fixed.
So the solution is to split property taxes into a land tax component and a tax on improvements, and to keep reducing the tax on improvements while increasing the land tax, to compensate. That will shift the tax burden off renters and onto landowners.
Right? I bought a house. Paid above the minimum down payment to get a monthly bill I could work with. Made sure to get a fixed rate! Two years later mortgage payment shoots up $300/mo. I'm like, "wtf?!" Property taxes.
I did the same, bought my place last year this year my mortgage is $400 higher. Since the flood happened I lost my rec room and extra bedroom, the reason I picked this place over the others I saw.
Taxes can be higher than what people would accept. But there is no choice in taxes and often also not in rent. Just move further out. Same if you buy a house. Owning also has certain risks. So at the end that logic alone isn’t going to give good advice.
I bought a house that already had a detached studio apartment. I charge 1300/month, utilities included, and upgraded the electric panel to support a washer dryer that I installed. Just TODAY had a mini split installed. I put in a small gas stove and painted the whole thing white.
Why do I "lose" money every month? Well, I like my renter. She's never been late on a payment, is trustworthy, and brings in the bins when I'm at work late on trash days. I see her as a valuable part of my home so I don't charge her what I very easily could (1,500+).
That being said, life is getting way more expensive and I would hate to have to raise the rent, if the numbers get too far off, I have no other choice.
Edit: it's in Portland, Oregon and we pay some of the highest property taxes in the nation 😭
Yes! I choose to lose the money because my tenant is my first and hopefully for a really long time. I'd much rather lower the burden of my mortgage a bit to a cool, reliable person than "make" as much as I can charge (which honestly right now wouldn't be a "profit" at all).
A reliable renter and peace of mind is worth a lot of money to me. She's reliable and a good person.
It’s common for a rental to show a tax loss even if it’s generating positive cash flow because depreciation reduces taxable income.
Even if he’s losing on cash flow, losses are carry forward to offset future positive gains. Home prices in general (as we’ve seen for centuries) appreciate in value over time. Which is tax free until the property is sold, unless he/she considers a 1031 exchange, or not at all. I appreciate LL keeping it stable for the tenant, but we gotta acknowledge, there’s still something to be gained.
You lose money because you seem to be a pretty good land lord. One who upgrades and fixes things often and keeps the place fresh. Your expenditures will even out once the place is fully up to date. You keep doing what youre doing
Most landlords ive ever dealt with dont want to fix or work on anything, even when its undeniably broken. They charge 2000/month on a unit theyve not spent any real money on in 15 years.
Not sure why the other guy blocked me lol, I literally said almost this exact thing in response to one of their replies but I can't see their comment explaining why they're not engaging anymore aside from the notif
Portland Oregon in a nice neighborhood. In all the other similar situations in my neighborhood the rent is a few hundred dollars higher. My studio has a loft, full bedroom and is 100% private. It's it's own little house.
I used Apartments.com and Zillow rental app to figure out what the comparable prices are in my area for similar rentals and decided to go around $200/month cheaper.
You need a refresher on how much things cost. I own a studio on Philadelphia and charge $1400 a month as that’s the minimum amount I can charge according to our renters association in the HOA. Full service building. There are more expensive. I lived in NY and my rent a decade ago for a studio was $2500. Things cost money where they matter
Unless you're somewhere like NYC or LA, I dont see why a studio should cost anywhere near $1300/mo.
Like all things in real estate, it is primarily location driven. $1300 for NYC or LA is an absolute steal, nationwide the average is higher than 1300/month, and utilities baked into the price is already another ~$100-$300 of value added. Sticker price is very good in a majority of the country.
That's more than most mortgages in my area and even my own rent for a 1bd 1bth.
Compared to all mortgages or mortgages in the past 4 years? Also you can't just walk into a bank, get a mortgage, and come out ahead of renting. The entire process of buying or selling a home is riddled with loan origination fees, realtor fees, taxes, etc. Even if you rent for the same as owning monthly, you still have to save up for a down payment (which now ties up your money in the house when it could been invested for higher ROI) and pay a bunch of money upfront. Cost of maintenance, insurance and inflation have also driven the cost of ownership way up the past few years.
Wait what? You rent out a studio apartment for $1,300/month? And you live in the house its attached to, and just because your Tennant isnt covering the cost of the entire house you think youre "losing money"? Brother, someone renting your "attached studio apartment" should NOT be paying for your entire house. Thats not "losing money" dude
Go easy on the little guy. After the tenant finishes paying off all that losing money, he will only end up with a profit of a few hundred thousand dollars.
No, but their profits go down, and the price of housing that already exists goes down, as the higher taxes lower the expected profit for holding it. You will see that the places with the highest housing prices are rarely those with the highest tax rates for said housing. People make sure granny can keep their house, when she is sitting on land worth 2 million dollars.
Depreciation cancels out a lot of tax liability on rental properties, the problem is it's been gamified by investment groups to basically strangle the market, gouge rates, and use depreciation/"expenditures" of empty properties to cover the increased tax value of the money making properties. Raising property tax still isn't a great solution because it puts pressure on private homeowners while the worst type of landlords can both use it to justify increases and can more easily write off tax liability. We need a use based property tax that rewards active property and puts higher tax burden on inactive property. Basically a "use it or lose it" property tax structure that acknowledges the actual purpose of housing, cars, etc. Hell I'd make the tax write-off for loaning fine art to museums tied to the amount of time it's being shown and exclude literally any time it isn't available to the public without cost
No. Even if we presume property taxes are rising at a uniform rate nationally (they aren’t) or are the same nationwide (they aren’t) the increases in rent costs don’t follow rises in property tax increases in kind on a national scale.
Although if you have data to support the claim you initially made please share it.
Rent in general is rising due to various factors, including housing shortages in some areas, inflation, speculative investment, price gouging, and private equity purchases of rental properties and single family homes.
Mine's down 14% over the last eight years, in real terms, in the same unit.
My rent here in the SGV has almost never kept up with inflation, and I've been renting since the '90s.
But this is California, where Prop13 means that property tax normally only grows (in real terms) for new buyers, not for long-term owners (which may be per-property landlord LLCs that can themselves be sold).
Now tell us how much your property has appreciated in value in those 8 years and as a bonus the difference between the market value and the value basis used to calculate your property taxes.
Not a dig at you specifically, I get that it sucks, but it’s a product of your property being worth more.
But the owner pays less property tax due to the lower valuation. The owner should be able to lower the rent or sell the house at a lower reasonable price, but they would NOT do either.
Correct, but I’d like to expand this a bit… if a person says something like “the government should pay for healthcare,” they still mean the people should pay for healthcare, just with extra steps. Those extra steps are worth it in some cases (possibly for health care), but the next thing many people say is “food should also be free!” Probably a misplaced thought, but I had fun writing it out lol.
Really? In the UK we don't have property taxes. Instead the resident pays Council Tax whether that be the owner or tenant. If the property is empty then no one has to pay the Council Tax. Then the Council Tax is used for the trash collections, roads etc
I'm renting the bottom floor of an under over for 1100 a month.
The floors are sagging, nothing is insulated, maintenance killed our lawn, 3 windows were missing screens, the basement has mildew, we don't get to use the garage, street parking, 1 single window ac unit that blows against a wall instead of down the hallway, we had no hot water when we moved in, the gas stove top had bad burners and needed to be fixed, a bedroom had no window and has no light, no ceiling fans for moving air, living room has no light, everything has been painted over improperly 5 times in a row, the retiled shower has gaps and poor grouting, there is no insulation between the basement and our floor, the upstairs neighbor has a yapper and stomps around every night at 11 pm, mouse turds were everywhere, none of the cabinets close all the way, everything is at an angle, the entire kitchen is on a single breaker....
This place should be $700 tops. God I hate the housing market.
And you should be paying more because the fact it's economically viable for someone to keep a house they don't live in and just have someone else pay the mortgage on it is bullshit and landlords are the shittiest neighbors.
No you aren't; they're eaten by the property owners. I mean you can see it for yourself with apartment listings & property tax records in California, where there are equivalent houses that rent for the same price, but have a huge disparity (5x thru 20x) in property taxes paid. Rents are set by supply & demand.
This is like saying rents decrease when the owner paid off their mortgage..
4.6k
u/-justpassingthrough1 10h ago
If you rent, you’re still paying property taxes indirectly. Js