Property Taxes Growing Faster Than Incomes
From the Asbury Park Press:
Property taxes go up faster than incomes
Property taxes go up faster than incomes
Property tax increases greatly outpaced personal income growth in the region's suburbs between 2000 and 2004, a turnaround from the 1990s, according to a report published Monday.
Property tax collections throughout New York, New Jersey and Connecticut rose twice as fast as income during the four-year stretch, and the gap in suburbs was even larger, according to a review of state and federal data by The New York Times.
"People's wealth may be growing if they own a house, but the census data show that their income isn't keeping up with their tax bills," said Gerald Prante, an economist with the Tax Foundation, a Washington-based group that favors lower taxes.
The widest gap in the region was evident in New Jersey's Somerset County, where property taxes jumped 41 percent while income grew only 5 percent.
In Nassau County, Long Island, tax collections rose 29 percent while personal income went up 11 percent. In New York's Westchester County and New Jersey's Bergen County, the property taxes also grew at about three times the rate of income.
...
Bob Vena, a plumbing contractor in Hazlet, said he does not know how long he will be able to afford the soaring taxes on his home and bungalow, which now total $13,500 yearly.
"Eventually I hope to sell everything and just get out of New Jersey," Vena, 63, said.
26 Comments:
I watch all these HGTV shows with people upgrading this, adding granite to that, and when you factor in property tax increases because you've improved the home, these upgrades are financial losers.
Upgrading a kitchen and upgrading bathrooms, for example, will increase your NJ property taxes forever.
Why do people still have kitchens and bathrooms from 1942? The Tax Man.
Taxes in Essex county in particular are obscene, you're looking at $10,000 minimum, with $15,000 quite common as well. And if you actually have a back yard, forget it.
Why don't you just move to central jersey then? property tax is still not that bad in central Jersey.
Then how do people afford to shop the way that they do.
In the suburbs of Long Island & NNJ, people judge you by what you wear & what you drive.
The whole culture is geared toward toward two activities spending money, shopping, and eating at bad but over trendy restaurants.
Now people will be pulling home equity & maxing out credit cards for the holiday season & back to school.
{{Ah, but to WHO? I suppose it's all the rich 20-somethings and their $300 jeans. }}
But they don't pay rent or mortgage, the parents do like paying another 4 four years of college tuition & living expenses
just pay taxes on your credit cards
along with jeans and everything else
"Eventually I hope to sell everything and just get out of New Jersey," Vena, 63, said."
better sell soon or you'll never get out.
i had a reltor tell me this weekend that this is temporary slowdown. prices will not go down only yes you guessed it level off. there is an article going around his office from the nar or njar about demand over the next ten years will cause prices to continue to rise. i asked where the demand is going to come from? the reply was population increase. so there you have it hurry and buy while prices have temporarily leveled off
anyone see this letter?
People are just going back to spending the old fashioned way - on credit cards.
For everything from Gas - Taxes - mall shopping sprees. Most DO NOT pay in full, but just transfer from one card to another.
But we live in the most consumer oriented part of the country. People spend $2,000 - $5,000 a month just on clothes which is more than property taxes..
"No effect on property tax. An increase in square footage will. Adding a deck will. But not improvements."
what about hardwood floors?
Escalating cost squeezing the bubbleheads!
Between the property taxes slaes taxes utilities and maintenance HOME PRICES WILL GRIND LOWER.
BOOOOOOOOYAAAAAAAAAAA
Bob
{{{For everything from Gas - Taxes - mall shopping sprees. Most DO NOT pay in full, but just transfer from one card to another.}}}
How do they get/keep credit! I can't get a card. They won't accept the libray as my address.
"Why don't you just move to central jersey then? property tax is still not that bad in central Jersey."
Time is also money, and I'd rather pay high taxes than suffer a long commute.
If I made a move, it would be to another state, where you can have both a reasonable commute, and reasonable taxes.
"No effect on property tax. An increase in square footage will. Adding a deck will. But not improvements."
Not in my town -- I asked town hall this week.
Also, from what I gather after many online searches, most towns in NJ will increase property taxes if:
* You perform "substantial" renovations to bathrooms and kitchens.
* You install central air conditioning.
* You install new siding.
Here's an example:
"The following items may effect your assessed value: conversion of attic, basement or garage into living areas; installation of a bathroom or powder room, central air conditioning, fireplace, porch, patio, deck, additions, new siding, inground swimming pool, or other structures."
http://lindenwold.net/tax_assessor.htm
Several other NJ municipal sites referred to "significant" remodeling of a kitchen or bath as cause for a tax increase.
Rich, the message from the tax assessor was basically this: "Any improvement that increases the value of your house, will increase your taxes."
They also wouldn't proivide any guidelines ("every house is different"), so I'd know how to stay within some boundary.
It's offical. They have killed
NJ.Not only is it a welfare state
but also the nj taxpayer pays for
it.
How can people continue with this
state of affairs?
NJ , has turned into a third world
state.
And it getting worst. The state
can't bail all these town out
from their pension and salary
increases.
So here is the solution - MOVE.
There are so many other places around the country where the cost of living is not confiscatory like in NYC/NJ.
Notice the politicians like Bloomberg & Corzine aren't even talking about a middle class tax cut but assume that everyone makes $200,000 per household.
Either make more money or move. This region sucks anyway. Everything & everything is ridiculously overpriced, the beaches are crowded congested & dirty, commuting costs are ridulous, and rents are astronomical.
You can't even find an apartment in a ghetto neighborhood for less than $2,000 a month.
Piece on Ben Jones (thehousingbubbleblog.com) from Newsweek:
Bubble Blog
A popular blogger explains how he predicted the cooling of the real estate market and what the mainstream business press can learn from sites like his.
Newsweek/MSN was nice enough to include a link to our little bit of the bubble as well.
Thank You Kathy Jones!
Question:
Richie - is he:
1)Robin to your Batman?
2)Yin to your Yang?
3)Goliath to your David?
4)Warren to your Jim?
5)other?
Please let us know.....
lookie......
Credit-Default Swap Market Whipsawed by Verizon (Update1)
Aug. 8 (Bloomberg) -- Companies in the process of restructuring are whipsawing the $346 billion credit-default swap market, where money managers bet on the ability of corporations to pay their debts.
Unexpected price changes for credit-default swaps, financial instruments typically based on corporate bonds and loans, are setting off alarms on the trading floors of the biggest banks and securities firms.
[edit]
Similarly, hedge funds were roiled after credit-default swaps of London-based Rentokil Initial Plc plunged 80 percent in value when the pest exterminator decided to issue debt through a new holding company.
The wild swings in credit-default swaps, which were created 12 years ago by investment bankers in London and New York, have become ``an unpredictable problem,'' says Stephen Rodger, who helps manage $3.8 billion of bonds at Baillie Gifford & Co. in Edinburgh, and has no intention of participating in the market any time soon.
Hedge Fund Nightmare
[edit]
For hedge funds, unregistered pools of capital where managers participate substantially in the profits of the money invested, the volatility of credit-default swaps is a ``nightmare,'' said Simon Ballard, head of research in London at ARC Securities Ltd., a fixed-income broker. ``Credit derivatives have underpinned the evolution of the hedge fund community for the last few years.''
New York Fed
Even the International Swaps and Derivatives Association, the trade group that has championed credit-default swaps as tools to reduce risks in the debt market, is concerned that increased volatility shows the hazard that the contracts no longer reflect the value of assets they're mimicking.
[edit]
Prices of credit-default swaps, which enable traders to bet on increases and decreases in corporate indebtedness, fluctuate the most when companies surprise speculators by announcing mergers and acquisitions, spinoffs, leveraged buyouts and other corporate restructurings. The volatility of credit-default swaps is increasing on a record $2 trillion of takeovers this year, up from $1.5 trillion in the same period of 2005, according to data compiled by Bloomberg.
Rentokil's Swaps
The increase in M&A has helped make credit-default swaps the fastest, growing part of the market for derivatives, financial instruments derived from stocks, bonds, loans, currencies and commodities, or linked to specific events like changes in the weather or interest rates.
[edit]
Market Rocked
``Bondholders typically get taken care of because companies want to maintain good relationships with investors so that they can access capital markets in the future,'' said Matthew Mish, credit strategist at Barclays Capital in New York. ``The fate of the same company's credit-default swaps is determined by the ISDA definitions, and the rules are the rules.''
[edit]
Currently, there are 31,430 properties advertised for sale in NJ on our site.
cf,
Is it just me or does there seem to be a "DIY-Hedge Fund" craze developing?
Seems alarmingly similar to the "Become a day trader" craze.
grim
If you're careful where you buy, and with the smaller amount of congestion, commuting from most Central NJ communities take less or about the same time as many of those from Bergen, Essex or Union counties
I've found my perfect house, and cannot fathom making an offer (either a lowball now, or in 2007/8) given the property taxes.
My budget spreadsheet melts after entering the property tax info, and the house has a kitchen and bathrooms from the 1940s. Once those are updated, the property taxes would be more obscene.
Frustrating...
I think moving to another state is the best solution for my family.
if you think river edge is bad
try Closter, same problem.
And who would want to live in Clifton, (my word)
Yes.
Clifton is massive garbage.
It should be merged with Paterson, but I'm sure Paterson would refuse.
I think Clifton means "untreated raw sewage with terribel bike paths" in the Ramapo Indian language.
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