But they PROMISED!!!!

[SanDiegoDave]

For those opposed to Prop 13, I would submit that you haven’t had to live through and experience unrestricted property tax situations like they have in other states.

In Milwaukee, for example, everybody’s property is re-assessed Every. Single. Year. Same with Texas. Just ask someone in the Houston area how much they pay in property taxes. How would you like to pay 5-7 times what you’re now paying in property taxes – no matter how long you lived there?

That’s what happens without a Prop 13 style restriction in place. Don’t like that your neighbor pays less? Tough. I be you won’t be complaining 30 years from now when you’re paying way LESS than the neighbor on the other side 😉

[SanDiegoDave]

For those opposed to Prop 13, I would submit that you haven’t had to live through and experience unrestricted property tax situations like they have in other states.

In Milwaukee, for example, everybody’s property is re-assessed Every. Single. Year. Same with Texas. Just ask someone in the Houston area how much they pay in property taxes. How would you like to pay 5-7 times what you’re now paying in property taxes – no matter how long you lived there?

That’s what happens without a Prop 13 style restriction in place. Don’t like that your neighbor pays less? Tough. I be you won’t be complaining 30 years from now when you’re paying way LESS than the neighbor on the other side 😉

[sdcellar]

Tell me, is Texas representative of all states without prop 13 (like) legislation? I’m just curious because it always seems to be the example put forth as to where things will go without it.

[sdcellar]

Tell me, is Texas representative of all states without prop 13 (like) legislation? I’m just curious because it always seems to be the example put forth as to where things will go without it.

[Reality]

If you think things are bad for the average folks now, wait until mortgage rates get insane, inflation rises, while salaries stay stagnant.

Wrong. Higher mortgage interest rates will simply drive prices down more.

[Reality]

If you think things are bad for the average folks now, wait until mortgage rates get insane, inflation rises, while salaries stay stagnant.

Wrong. Higher mortgage interest rates will simply drive prices down more.

[SanDiegoDave]

Texas isn’t the greatest comparison – overall – because they have not state income tax. Wisconsin would be a better one. They have a hefty income tax, and 4%+ property tax (varies by municipality).

[SanDiegoDave]

Texas isn’t the greatest comparison – overall – because they have not state income tax. Wisconsin would be a better one. They have a hefty income tax, and 4%+ property tax (varies by municipality).

[Coronita]

If you think things are bad for the average folks now, wait until mortgage rates get insane, inflation rises, while salaries stay stagnant. Wrong. Higher mortgage interest rates will simply drive prices down more.

 

 

I'm not disagreeing with your statement. Higher mortgage rates will drive prices down more. I'm just trying to understand how people think that during a period when mortgage rates are high, why inflation isn't going to be a problem and how it's not going to significantly eat into their purchasing power when that time comes to buy a home.

 

I'm just curious home many folks are planning to purchase without a conventional loan (20% down, etc). How many of us will be really affected if for example, it's $4/gallon to fill up, or if the cost of medicine goes up say 20%. Why would mortgage rates run rampant in a vacuum?

[Coronita]

If you think things are bad for the average folks now, wait until mortgage rates get insane, inflation rises, while salaries stay stagnant. Wrong. Higher mortgage interest rates will simply drive prices down more.

 

 

I'm not disagreeing with your statement. Higher mortgage rates will drive prices down more. I'm just trying to understand how people think that during a period when mortgage rates are high, why inflation isn't going to be a problem and how it's not going to significantly eat into their purchasing power when that time comes to buy a home.

 

I'm just curious home many folks are planning to purchase without a conventional loan (20% down, etc). How many of us will be really affected if for example, it's $4/gallon to fill up, or if the cost of medicine goes up say 20%. Why would mortgage rates run rampant in a vacuum?

[bubba99]

Inflation and interest rates are oddly not connected. Interest rates pay for capital, not housing expense which goes into inflation rates. This is one of the reasons that inflation rates stayed so low during the housing boom – rents got disconnected from prices, and inflation was neutral from housing.

[bubba99]

Inflation and interest rates are oddly not connected. Interest rates pay for capital, not housing expense which goes into inflation rates. This is one of the reasons that inflation rates stayed so low during the housing boom – rents got disconnected from prices, and inflation was neutral from housing.

[noone]

“Inflation and interest rates are oddly not connected”

Ben Bernanke would disagree with you. One of the ways the Fed tries to cut inflation pressure is to increase interest rates. What they are actually changing is the interest rate that banks charge each other, but that usually (not always) has a ripple effect to consumer rates, including mortgage rates. The idea is that higher interest rates decrease the demand side of supply/demand, which should help keep inflation in check.

[noone]

“Inflation and interest rates are oddly not connected”

Ben Bernanke would disagree with you. One of the ways the Fed tries to cut inflation pressure is to increase interest rates. What they are actually changing is the interest rate that banks charge each other, but that usually (not always) has a ripple effect to consumer rates, including mortgage rates. The idea is that higher interest rates decrease the demand side of supply/demand, which should help keep inflation in check.

[sdcellar]

dpsvend– I guess you didn’t understand that I was looking for an example that goes in the other direction. You wouldn’t be Howard Jarvis, would you?

[Author]

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