Last week Larry Ruehlen from the West Bloomfield Observer-Eccentric called me to chat about the proposed moratorium on the pop-up tax, which, if passed, should help to stimulate sales of existing homes. My conversation with Larry made me think about some of the aspects of how this legislation will impact the way I sell real estate. A few things come to mind:
Back to my Prop A/Headlee rants and everything we are seeing in the papers right now about the state of the State’s budget. A quick fix for school funding is to remove the cap on non-homesteaded properties. Homes and buildings that are not primary residences should pay taxes based upon their SEV, not their capped taxable value. The intent of Prop A was to protect the elderly from being taxed out of their homes, not to protect long-time landlords and business owners.
Take a look at Larry’s full article on the proposed moratorium to the pop-up tax.
And…
In other press clippings, last week we were in an Oakland Press piece about the Birmingham – Bloomfield Realtor Network and the work we are doing.
[tags]pop up tax, michigan property taxes, proposal a, michigan pop up tax, michigan property tax moratorium[/tags]
Written by Maureen Francis
SKBK Sotheby's International Realty, 248.430.4450
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{ 4 comments… read them below or add one }
Black Tie Todd 03.19.07 at 5:45 pm
Maureen,
I have to kindly disagree with you about removing the cap on non-homestead properties. Not only does this state need small to medium sized businesses to remain in Michigan, but the second home and vacation home owners will find themselves in need of dumping their properties too.
Yes, your proposal is indeed a quick fix, but I think the long term effects would be disastrous. And they might not take that long to come to fruition!
Maureen Francis 03.19.07 at 5:59 pm
I see your point, Todd, and I agree to some extent. But I think that removing the cap from the non-homesteaded properties would mean that we could lower millage rates across the board for both homesteaded and non-homesteaded properties. It could actually help to stimulate the economy if millage rates were lowered. The current system protects longtime owners of vacation property, rentals and commercial property and shifts their tax burden to first time buyers and people who are forced to move here. It is inequitable.
Dick Gach 03.28.08 at 10:33 am
Maureen, Did you consider the increase in rents that would occur? Many renters are in the lower income bracket and do not need increases in rent.
Maureen Francis 03.29.08 at 9:38 am
Dick,
Good question.
If tenants need social assistance then we need to offer programs to those in need, not just to the landlords who have owned the house the longest. The landlord does not have to pass along the savings of lower taxes to a tenant who needs help, so the current system works mostly to line the pockets of the landlord.
Removing the cap would mean the millage rates could be reduced across the board so it could result in more choices for affordable housing than leaving the system the way it is, where only the long term landlords benefit from lower taxes.
I own a rental home. The guy across the street owns a similar rental home. He has had it for 20 years. His taxes are about 1/3 of mine. I would pass along the tax savings to a tenant if I could, but because I bought more recently I pay more, so my tenant pays more. Does my tenant use more city services than his tenant? I don’t think so.