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Banks pay no property tax on foreclosures?


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2008 Jun 23, 6:56am   27,655 views  320 comments

by Patrick   ➕follow (59)   💰tip   ignore  

On Jun 23, 2008, at 11:49 AM, A Guy wrote:

Long time reader...and, luckily, a renter here. I would like to bounce an idea off of you. I hear that foreclosed properties don't pay prop taxes. Is that true? If yes, then is there any way you can use your contacts/site to support the idea that municipalities impose regular prop taxes on empty houses. This would:

  • increase holding costs, forcing trustee to sell more quickly, driving home values to normalized pricing levels more quickly
  • help neighborhoods by 're-populating' them more quickly
  • reduce the unfair concept that only owner-occupied houses bear the tax burden
  • ultimately deter speculation
  • reduce likelihood of municipalities facing bankruptcy

Your thoughts would be appreciated.

Phil

Thanks Phil,
I've heard that as well, but it's hard to believe, since it would be so unfair that banks pay no taxes while everyone else has to.

The idea of using property tax to keep things fair (and eliminating income tax and sales tax entirely) is an old one, but not yet tried anywhere. Henry George proposed it more than 100 years ago:

http://en.wikipedia.org/wiki/Georgism

I'll make a post out of this.

Patrick

#housing

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112   justme   2008 Jun 25, 4:11am  

Malcolm,

About the demographic of the Ford Extinction crowd:

I'm afraid you may be right. There is a lot of women who are now addicted to the testosterone-appeal of these cars. Very sad. I could speculate on the deeper psychological and sociological reasons for this fact, but that might turn into a whole other thread.

113   Malcolm   2008 Jun 25, 4:12am  

I share the fear Headset. I think this is a window for people to shift their habbits once and for all. Electrics and hybrids in full production will be so compelling on their own that I can't imagine people wanting to shift back. I imagine that we will see big muscle hybrids, I'm not sure that even bothers me.

114   Malcolm   2008 Jun 25, 4:15am  

I don't even want to open that box because I actually feel we have had a gender role reversal in this country. Women were traditionally the moral compass keeping their men in check and now I meet more and more gen x and y men who seem very enlightened. I don't know if it a generation thing, a California thing, a current political shift, but I know what I am seeing over and over.

115   Malcolm   2008 Jun 25, 4:16am  

Don't get me wrong there are plenty of girls who dig the environmental point of view, but the ones in influencial social circles seem to be the late adopters.

116   justme   2008 Jun 25, 4:18am  

Headset,

You're right, gas *should* be $4/gal.

We can tax it to get there if need be, This will get Peter P's Panties in a twist, but ask me if I care.

117   Malcolm   2008 Jun 25, 4:18am  

My longtime girlfriend seems to really like the image she conveys driving her Prius. She also seems to generate respect in her circles by what I'm doing with my life so maybe it is a subset of women.

118   HeadSet   2008 Jun 25, 4:20am  

Malcolm,

Interesting that the hybrid and advanced diesel is coming out now. It is as if the foreigners predicted the higher US gas prices and saw a way to capture US market share. After all, high gas prices have been the norm in Europe for quite a while, and they coped by building small cars/engines. When I was in England during the mid 90s, it was not uncommon to see cars with sporting a "1.0 Litre" badge..

119   Malcolm   2008 Jun 25, 4:22am  

$4? Premium was at 4.99.

I know a year ago or so I predicted prices would drop with an economic slowdown. I have to say that prediction was wrong but probably irrelevant since those who actually want to take control of their wellbeing are going to make the switch and it will not even matter.

I still think if we really do slowdown there will be a short term glut of oil in production. I believe that the handwriting is on the wall and like any typical industry they are just maxing out the revenues while they can. The world is going to be very different starting next year.

120   Malcolm   2008 Jun 25, 4:26am  

The timing is what is killing our car makers because predicting hybrid market share was counterintuitive.
That's the reward of doing what's right instead of merely following and guessing market trends. Everyone here is richer for not following the housing trend up, and that's what happened in the auto industry. That's why the billybobs will always live a backwards life with a poor quality of life.

121   Malcolm   2008 Jun 25, 4:28am  

I'm glad I checked the blog today. I've been working a lot but today I have a headache so I'm going in later.

122   justme   2008 Jun 25, 4:31am  

ShortTermCapitalMgmt,

Those are big electric performance motorcycles. Have not seen them. But I can tell you that China is full of small moped-meets-bycycle-sized electrical cycles, Little ones that will get you around town in a very effective manner. Nice to see.

123   justme   2008 Jun 25, 4:32am  

Malcolm,

I'm with you on the gender role thing. Let's just leave it at that for now.

124   EBGuy   2008 Jun 25, 4:33am  

Regarding the cleanliness diesels, "true believers" will tell you:
Other references show that at the very worst, exhaust from engines with DPFs are indistinguishable from the intake air in terms of PM numbers (http://www.aecc.be/en/content/pdf/AECC%20Newsletter%20March-April%202007.pdf, “Report on Ultrafine Particles”, page 7).

Sorry about the UCSD/SDSU mix up. In fact, when I first read about it years ago, I distinctly remember being impressed that these were folks within the State University system.

The oil was paid for.
It certainly was!
Have to admit I started getting excited hearing Amory Lovins talking about how the military has converted to using "the fully burdened cost of fuel" when calculating expenditures for military vehicles. The times they are a-changin'...

125   Malcolm   2008 Jun 25, 4:38am  

I was kidding on the SDSU thing though I am proud of them. I had a really good experience with their business program.

126   justme   2008 Jun 25, 4:42am  

I think

"The oil was borrowed for"

might be a more correct expression, than

"The oil was paid for".

127   Peter P   2008 Jun 25, 5:36am  

You’re right, gas *should* be $4/gal.

Your rent *should* be $4000/month.

128   DennisN   2008 Jun 25, 5:53am  

I would guess the problem with an automotive diesel/electric hybrid is that it takes a lot more to start up a diesel engine than an otto engine. Most of the hybrid's efficiency comes from turning the gas engine off when not required and using regenerative braking.

Diesel/electric drives in locomotives and on subs don't shut the diesel off frequently.

129   justme   2008 Jun 25, 5:53am  

Why, because I'm wasting so much space and not preserving it for future generations? Wrong!

130   Peter P   2008 Jun 25, 5:57am  

The future generation will have their own economic equilibrium. Why do we have to preserve anything (other than jam) for them?

131   OO   2008 Jun 25, 6:00am  

Malcom,

GM ripped out this country's public transportation network, and you called that doing things right? In case you don't know, they killed their own electric car too.

GM is a perfect example of a greedy and incompetently run company that I hope will go belly up as soon as possible, taking its idiot management and dumb workers along please.

It's a miracle that the Big 3s are not yet gone, I can hardly find any reason to buy an American branded vehicle. The other day when I read about GM's revival of 0 interest for 6 years, the deal-seeking part of me immediately went to their website to check out the cars to see if the price can justify. While I kept scrolling through their cars, I was saying to myself, crap, crap, crap, hmm, Saab, crapified, crap... I am a very easy consumer to convince because I am very price sensitive and I can let the deal overcome my preference, somehow I still cannot possibly bring myself to buy any GM vehicle.

132   Peter P   2008 Jun 25, 6:03am  

How about a Cadillac CTS?

http://www.iihs.org/ratings/ratingsbyseries.aspx?id=309

Looks pretty safe.

133   Peter P   2008 Jun 25, 6:13am  

A very, very unfortunate Supreme Court decision:

http://www.csmonitor.com/2008/0626/p01s10-usju.html

134   Peter P   2008 Jun 25, 6:24am  

It is beneficial to bring back the moral compass. Let's start by restricting no-fault divorces.

Enforcing private contracts *IS* the government's responsibility.

135   Malcolm   2008 Jun 25, 7:01am  

OO, I totally agree with you which is why I am confused about me ever saying they did anything right. Perhaps you are reading where I wrote it was unfortunate and interpreted it to mean that I am a fan. What I meant, and is clear in the overall context, is that it is unfortunate that it is the foreign car makers who have provided the solutions. I'm not anti American which is the only reason I think it is a shame. I am actually happy to see these small American startups springing up. I think it is going to be a good thing.
I am of course well aware of the EV1, ironically as I was driving in after posting earlier, I was thinking about the stories of people being forced to give their EV1s back under protest. How that wasn't a sign of market sentiment is beyond me. Even that very limited experiment generated large fanfare.

136   Malcolm   2008 Jun 25, 7:03am  

TOB, I guess Eve got them off to a bad start. :)

I guess there are many angles but for some reason modern day professional women seem to have a need to show that they can be just as sleezy as their boomer male role models.

137   Malcolm   2008 Jun 25, 7:08am  

ShortTermCapitalMgmt Says:
June 25th, 2008 at 10:22 am
"Malcolm,
Do you know anything about these electric cycles?"

I got sidetracked and didn't mean to not reply. I don't know much about them. During the EV1 days when electric car ranges were unacceptably short I did look into EV motorcycles only because their size did allow about 100+ mile range and they were about $25,000. I'm the kind of guy who looks for anything viable and then looks further to see if I can use it in a practical manner. I am not a fan of street motorcycles but if someone is I think they present a very good option.

138   OO   2008 Jun 25, 7:15am  

Malcom,

I must have scanned through the posts in a hurry, sorry for the friendly fire.

I am glad that we are on the same page :-)

139   Peter P   2008 Jun 25, 7:37am  

I like diesel mostly because:

1) it is not as flammable as gas
2) diesel engines have tons of torque

I like heavy cars. MPG is not as important. Let the market decide! :)

140   Bork   2008 Jun 25, 7:57am  

I'd like to see bridge tolls calculated based on vehicle's weight since the heavier vehicles put more strain on bridges. I'd like to see registration fee calculated based on vehicle's size/MPG - heavier vehicles wear higways more and pollute more. That'll be fair. And then let the market decide.

141   Bork   2008 Jun 25, 8:09am  

TOB,

Sorry, I totally missed your joke.

142   justme   2008 Jun 25, 8:28am  

Bap33,

Just a quick one, maybe I will find the energy for more later:

1. I'm sure you agree that bad FM/Ford/Chrysler built-in-a-hurry technology from the 70s does not invalidate new 2009 technology. They were late to the party then just as they are now. Let us hope they do not repeat their mistakes, but instead do some good engineering,

2. Yeah, the reality of high energy costs will catch up with anyone. And even the US automakers will maybe eventually do the right thing. Meanwhile, Europe and Japan have been on the right track for many years already.

3. Power/Weight is a completely different metric than Energy/Distance (MPG). Race cars have great Power/Weight and lousy MPG, at ANY speed.

4. It sounds like you think that an engine can be built for (and more importantly SIZED for ) performance, and at the same time provide economy (=energy efficiency in my terminology) simply by driving it "nicely". I think this is not the case. The closest thing we have is a clean Turbodiesel. But is not sized foer a crazy V12 racecar with insane performance. It just has plenty of oomph for daily use.

143   Peter P   2008 Jun 25, 8:51am  

I’d like to see bridge tolls calculated based on vehicle’s weight since the heavier vehicles put more strain on bridges.

I agree. It should also be calculated based on vehicle speed for similar reasons.

I’d like to see registration fee calculated based on vehicle’s size/MPG - heavier vehicles wear higways more and pollute more. That’ll be fair. And then let the market decide.

With toll roads and streets everywhere, we do not need the registration fee anymore. We do need to charge a pollution cleanup fee.

144   Malcolm   2008 Jun 25, 8:52am  

BAP, no one disagrees with your history lesson. This time it is different and the market has already decided. People are literally approaching Prius owners at gas stations offering to buy their cars from them because they don't want to wait. There is no subsidy in doing that, nor was there one for leasing one.

The home recharging model does make sense, and comparing reluctant manufactures of the past with market innovators of the present seems flawed to me. I have a strong feeling that our society does remember the days you are talking about. I believe government and industry are taking those lessons learned and realizing that this time it is not just an OPEC created embargo driving up prices. It is much more complicated. It involves everything from increased global demand, to remaining competitive because other countries have freed themselves by going to renewables. I guarantee if we had to do it all from scratch knowing what we know now, the conventional technologies wouldn't pencil out. I find it ironic that we have to defend incentivizing renewables when oil companies receive all sorts of subsidies and shelters, and hey what about the "gas tax holiday?" That sounds like government actually subsidizing our current habbits. Renewables now make sense, there's no way to argue against it.

145   Peter P   2008 Jun 25, 9:00am  

The home recharging model does make sense, and comparing reluctant manufactures of the past with market innovators of the present seems flawed to me.

I would agree if retail electricity prices are unregulated.

146   Malcolm   2008 Jun 25, 9:11am  

I voted for that, turned out the free market wasn't the best way to run electric providers. I still don't know what went wrong with that. BTW, if SDG&E had its way there would be no net metering for solar. Doing the right thing sometimes does require government intervention, like mandating a PUBLIC utility get a percentage of its production from renewables, otherwise the free market just forces the same old thing until you end up with a crisis or a situation where only the wealthy can drive, or have electric power, or worse yet, those who are powerless get to have the waste from those who have dumped on them.

Yeah, I'm just not as pure of a free market type as our old friend Peter P.

147   ShortTermCapitalMgmt   2008 Jun 25, 9:16am  

During the EV1 days when electric car ranges were unacceptably short I did look into EV motorcycles only because their size did allow about 100+ mile range and they were about $25,000. I’m the kind of guy who looks for anything viable and then looks further to see if I can use it in a practical manner. I am not a fan of street motorcycles but if someone is I think they present a very good option.

I've never ridden a serious motorcycle, and I'm not about to start today. I thought they looked like pretty impressive machines for around $10K, though.

I'm more likely to buy an electric bicycle, or conversion kit. I commute by bicycle a bit today, about half of the time when the weather's nice enough. If I had electric assist I'd probably bike to more places, and in somewhat warmer weather (I'm in Phoenix).

Thanks,

STCM

148   Peter P   2008 Jun 25, 9:33am  

otherwise the free market just forces the same old thing

If we charge polluters a cleanup fee, the situation will be different.

149   DennisN   2008 Jun 25, 11:01am  

So the Fed decided to keep things the way they are, but just TALK about a stronger dollar and how bad inflation is getting.

http://news.yahoo.com/s/ap/fed_interest_rates;_ylt=AgAek2VFxIVfUQFCh04SyMes0NUE

Bernanke, in a rare public utterance for a Fed chief, also has sounded a warning that the slide in the U.S. dollar could contribute to a rise in inflation. He has sought to use words — instead of action — to bolster the dollar and try to lessen inflation pressures.

150   DennisN   2008 Jun 25, 11:07am  

No Heller today. Crap.....

151   northernvirginiarenter   2008 Jun 25, 11:49am  

OO,

Your posts relative to the machinations of the power structure are exactly correct. I stopped being amazed at the state of complete "unawareness" of the majority of the US populace, even among my educated graduate degree crowd.

Folks simply don't understand that the moneyed interests have created a virtual monopoly of profits across critical major industries including notably chemical, steel, oil, and auto.

This cabal has created a regulatory regime which creates significant barriers to entry for competition, stifles innovation, and destroys the commons.

Even this hybrid crap is nonsense.

There is absolutely zero technological reason why we all should not be driving cars that weigh less than 200 lbs, getting the equivalent of 200 miles to the oil gallon, while providing better safety. The materials engineering science has been suitably advanced for some time.

Tragic and despicable.

Of course, what industries would not exist under this scenario?

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