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ProBillofRights t1_irepozo wrote

Reply to comment by JNmbrs in NY Times Real Estate weekly article "The Hunt" features couple looking in the Heights... by Chris_NJ

No offense taken with the tone of conversation. As the saying goes the devil is the details. I live in Hoboken and I'm just pointing that out now because I'll be circling back to it later on.

So my friend bought back in 2010, and didn't move in until 2012 when all the renovations were done. The house was very run down and on the verge of collapse. No one wanted it especially because it was surrounded by abandoned buildings as well. I thought it was a bad idea and I tried to convince them to buy in Hoboken instead. At the time Hoboken was safer, homes were more expensive but taxes were about equal or less than JC. And any future returns on selling a home was far superior to JC. I would unhappily be proven right.

Let's compare apples to apples. Hoboken was also hit with a reval too around 2013, a year after hurricane Sandy and 3 years before JC was hit with reval. My mom's house taxes went from $14,000 to $21,000. We now speed forward to present day and her taxes pretty much remained the same.

What can we learn from this? JC in 2010 at the time was suffering just like the rest of America from a housing bubble crash. Entire blocks with zero tax revenue coming in and a high crime rate, and people like my friend taking a gamble on a very bad neighborhood to beautify it and pay a much higher tax than my mom's house in Hoboken. $2,000 more to be exact.

Just a few months ago before the Board of Education raised taxes they were paying $27,000 in taxes. That's almost $7,000 more in taxes.

Now from all my complaining it would sound like I'm against paying taxes. But, that's not true. If I'm going to pay $27,000 in taxes and then get slapped again with more taxes in the $40,000 range I better get a big return for my money

I want better schools, which JC really doesn't have except if you're willing to pay $35,000 a year for private school or your kid is lucky enough to get into a charter school.

I want safe neighborhoods where it doesn't take hours for the police to show up.

For $40,000 a year in taxes I better be getting better service. Roads closures, uncontrolled high rise construction, politicans hitting bicyclists, high crime in certain areas. And list goes on.

My entire point is I was right about everything I mentioned above. Hoboken is not a utopia and I hate that I can't find parking in Hoboken at times. I hate the dog poop left on the sidewalk. But at the end of the day I'm not saddled with a massive $40,000 tax burden.

So put yourself in my friend's shoes and and ask yourself what do I get in return?

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objectimpermanence t1_irgvwrp wrote

> So put yourself in my friend’s shoes and and ask yourself what do I get in return?

Since they bought and renovated the house over a decade ago, they’ve likely had plenty of opportunities to sell it for a decent profit in the last couple years. Not to mention that the first $500,000 of the capital gains from selling a primary residence are exempt from federal income taxes for a married couple filing jointly.

In short, I have practically zero empathy for them. If they can afford to pay $40k in annual property taxes, they are doing better than the vast majority of households.

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ProBillofRights t1_irgwf6p wrote

They can't afford to pay that and most people can't pay that. Hence why they are moving. You didn't even attempt to put yourself in a position were your taxes went up that high. And, you're angry for some reason which I don't understand.

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objectimpermanence t1_irgyzn3 wrote

Assuming a 1.6% tax rate, a $40k property tax bill implies an assessed value of around $2.5 million, which may even be below the property’s market value despite the recent reval.

All I’m saying is that at the end of the day, they will probably emerge from this situation in a better financial position than most.

Sure, it’s sucks to be forced to move because you can’t afford the property taxes on your dream home, but so many people are being forced to move under much worse circumstances than your friends. Hence my lack of sympathy.

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SonOfMcGee t1_irikfc8 wrote

They don’t even have to move to another town. It sounds like they’ve put roughly $1M into a property that is now worth over $2M. They could sell and buy a $1M house with cash.

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ProBillofRights t1_irh1al0 wrote

It's going to get worse. Rents are sky high and when taxes go high so do rents. Forcing people to move out as well. Not to mention the small mom and pop landlords selling off their rent control properties and rich land developers buying the land and turning them into so called luxury rentals.

JC can turn into Detroit if they can't control the tax hikes. Families like my friend are leaving, and in a decade or two what will be left? I don't see JC doing well in the future.

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objectimpermanence t1_irh7fnt wrote

High property taxes are not what killed Detroit. The decline of manufacturing and the rise of suburban sprawl are what killed Detroit.

There is nothing of that scale currently happening in JC or in the broader metro area. It would take a protracted financial crisis or other major event for that to happen.

If anything, higher property taxes are a symptom of increasing prosperity because they generally reflect the fact that property values are also rising. Property prices and rents only go up as long as people are willing and able to pay them.

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ProBillofRights t1_irhbizn wrote

Car manufacturing jobs made up most of the jobs in Detroit back in the 60's. With the new upward mobility from the jobs in Detroit, young families realized they could live in the suburbs and they started moving out of Detroit, just like the people did in Newark in the early 60's.

The manufacturing jobs didn't start leaving until the late 70's and accelerated into 90's with NAFTA. But, the major point is the families were leaving the cities in the 60's because they could get a bigger home, better schools, and safer neighborhoods with their tax money than the inner city.

JC suffered the same fate in the 70's and it lasted all the way into the early 2000's. If it wasn't for the cheap tax, low rent, and close proximity to NYC, JC wouldn't be so attractive to young people. Hence why my friend bought in 2010. He thought he could live here and retire here, but he was wrong. And, it's a shame because JC needs young families like them to make the school system better, to make the city safe by voting for a Mayor that cares, a school board that cares, but instead they'll move away and take that tax base with them to the suburbs.

JC will not survive in 20 years if things don't change.

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