Tex117 said:

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Home prices always go up. WOOOHOOOOO! Yeaaaahhh Buuuuudddy!

(Of course you are correct, why folks can't seem to understand that real estate is as susceptible to booms and busts the same as the market at large is a foreign concept to me).

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The last big bust in real estate was 15 years ago. A whole lot of people in the market now were barely aware of it or not aware of it at all back then.

techno-ag said:

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Yeah had to help some folks out on this not long ago. Widow filed the paperwork and deferred taxes for years. She died and her heirs were stuck with a big bill. They would have liked to keep the house but never would have been able to catch up on the back taxes, so had to sell.

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Well, at least it worked for her and I'm sure that is all she was concerned about.

schmellba99 said:

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jja79 said:

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Arizona here. Cost of living other than gasoline is cheaper than Texas. I had intended to retire in BCS but it's too expensive. Going on 3 years here and there's no way I'd move back.

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When I moved back to TX from AZ, my tax liability went up as a % of my income.

The flip side was that I got a lot more house and land for less money than I bought in AZ.

Still really miss parts of Arizona though, especially during hunting season. From about October through April was awesome. Do not miss summers one bit, F that nonsense.

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I think Robert Earl Keen said it best....

"I understand why lizards live in sunny Arizona, why people do and call it home, I'll never understand..."

schmellba99 said:

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Tex117 said:

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Home prices always go up. WOOOHOOOOO! Yeaaaahhh Buuuuudddy!

(Of course you are correct, why folks can't seem to understand that real estate is as susceptible to booms and busts the same as the market at large is a foreign concept to me).

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The last big bust in real estate was 15 years ago. A whole lot of people in the market now were barely aware of it or not aware of it at all back then.

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I'm in my forever house and it's paid off. Don't care.

schmellba99 said:

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YouBet said:

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Aggie Spirit said:

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"At what point will people not be able to keep it even though they technically own it?"

With a significant portion of homeowners locked in with loans originated years ago at low interest rates, this may never be a significant problem.

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Pretty sure he was talking about taxes and insurance both of which are on a tear upwards the last several years. Those never go away.

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This.

Especially down here on the coast where you get raked over the coals with wind & storm insurance.

Between taxes (property & school only) & insurance (home only) pretty much an entire month of my income is dedicated to just covering the costs of those two alone. And it will never go down, ever. I just plan on an increase every single year until I'm 65 and my property and school taxes freeze (or go away?). But homeowner's, flood and wind & storm will increase year over year until I sell or die.

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Preach! Granted, I knew that going into it but still, damn.

My wife never wants to get rid of this place, so my new plan is this deferred tax strategy later on in life. No one wants this house when we pass so I'm going to let the estate handle it.

What's wrong with this? I get it's not for everyone but I like it. I'm really happy with what you can get here for the money and the fact there's never any traffic is great too.

High yes, but not complaining right now.

Homestead exemption just got increased to $140k and recently got the senior exemption which is at $60k. So just being taxed on value over $200k. Plus what I do pay can reduce my fed taxes somewhat since below SALT limit.

Real estate tax or state income tax (6 of one, half a dozen of the other)

Just spent Fathers Day Weekend in Crystal Beach. Hope you're not trying to sell your beach house right now.

HumpitPuryear said:

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kag00 said:

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Texas does need to get the property taxes under control. It has become a never ending wealth tax that is impossible to escape and must be paid just to live. For a retiree with little to no income it is actually more expensive to live in Texas than other places even if you own a home free and clear.

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We are a couple years out from retirement and are already looking out of state. Never thought I would even consider leaving Texas but property taxes are going to be brutal for retirees. Sure they are kinda capped but if you are already paying $10k+ per year plus escalating insurance it makes a lot of sense to move.

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Does it ? Everyone gets their pound of flesh. Other states either use income tax or a combo.

And moving from a place you presumably like over $5K vs $10K a year. 10 yrs $50K, 20 yrs $100K.

Coastal big city California homeowner & retiree here…I've carefully run the numbers on retiring to Tx, and it doesn't work for me. My prop 13 taxes are low, and my taxable income has dropped to where Ca state income tax is tolerable. I'll stay here and dodge the homeless and enjoy the year-round good weather.

Sid Farkas said:

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Coastal big city California homeowner & retiree here…I've carefully run the numbers on retiring to Tx, and it doesn't work for me. My prop 13 taxes are low, and my taxable income has dropped to where Ca state income tax is tolerable. I'll stay here and dodge the homeless and enjoy the year-round good weather.

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I have said it before that one overlooked benefit of high property tax burden is that it helps keep the riffraff out.

We bought a home in Fort Worth a couple years ago to be near grandchildren. We live in a fairly new house in a gated community in a desirable location. Property values haven't risen at all since we bought and homes are sitting much longer on the market (months instead of weeks). Since we bought it free and clear, and have no plans to sell anytime soon, that doesn't really matter to us, but I find it a bit surprising.

oklaunion said:

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techno-ag said:

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Yeah had to help some folks out on this not long ago. Widow filed the paperwork and deferred taxes for years. She died and her heirs were stuck with a big bill. They would have liked to keep the house but never would have been able to catch up on the back taxes, so had to sell.

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Well, at least it worked for her and I'm sure that is all she was concerned about.

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This. It was the widow's house/ money to spend and not her heirs. They only get what's left. If anything.
And that's the way it should be.

Burdizzo said:

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Sid Farkas said:

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Coastal big city California homeowner & retiree here…I've carefully run the numbers on retiring to Tx, and it doesn't work for me. My prop 13 taxes are low, and my taxable income has dropped to where Ca state income tax is tolerable. I'll stay here and dodge the homeless and enjoy the year-round good weather.

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I have said it before that one overlooked benefit of high property tax burden is that it helps keep the riffraff out.

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Also thought to keep major housing price bubbles from happening but it seems it happened here in 2021 anyway.

Mas89 said:

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oklaunion said:

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techno-ag said:

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Yeah had to help some folks out on this not long ago. Widow filed the paperwork and deferred taxes for years. She died and her heirs were stuck with a big bill. They would have liked to keep the house but never would have been able to catch up on the back taxes, so had to sell.

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Well, at least it worked for her and I'm sure that is all she was concerned about.

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This. It was the widow's house/ money to spend and not her heirs. They only get what's left. If anything.
And that's the way it should be.

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I agree, but be careful. There was a whole thread about how old people are hogging the wealth they saved. I was surprised how many "conservatives" thought they were owed some sort of inheritance.

Burdizzo said:

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Sid Farkas said:

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Coastal big city California homeowner & retiree here…I've carefully run the numbers on retiring to Tx, and it doesn't work for me. My prop 13 taxes are low, and my taxable income has dropped to where Ca state income tax is tolerable. I'll stay here and dodge the homeless and enjoy the year-round good weather.

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I have said it before that one overlooked benefit of high property tax burden is that it helps keep the riffraff out.

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I can assure you that I am not riffraff by f16 standards. Texas needs more imports like me.

Sid Farkas said:

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Burdizzo said:

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Sid Farkas said:

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Coastal big city California homeowner & retiree here…I've carefully run the numbers on retiring to Tx, and it doesn't work for me. My prop 13 taxes are low, and my taxable income has dropped to where Ca state income tax is tolerable. I'll stay here and dodge the homeless and enjoy the year-round good weather.

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I have said it before that one overlooked benefit of high property tax burden is that it helps keep the riffraff out.

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I can assure you that I am not riffraff by f16 standards. Texas needs more imports like me.

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Pretty sure he meant "the homeless" you, yourself, spoke about.

But, with the yuge amount of homeless already here...I'm not sure it matters. Hell, I've been homeless within the last few years. I'm only half riff-raff.

BigRobSA said:

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Sid Farkas said:

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Burdizzo said:

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Sid Farkas said:

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Coastal big city California homeowner & retiree here…I've carefully run the numbers on retiring to Tx, and it doesn't work for me. My prop 13 taxes are low, and my taxable income has dropped to where Ca state income tax is tolerable. I'll stay here and dodge the homeless and enjoy the year-round good weather.

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I have said it before that one overlooked benefit of high property tax burden is that it helps keep the riffraff out.

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I can assure you that I am not riffraff by f16 standards. Texas needs more imports like me.

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Pretty sure he meant "the homeless" you, yourself, spoke about.

But, with the yuge amount of homeless already here...I'm not sure it matters. Hell, I've been homeless within the last few years. I'm only half riff-raff.

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The point being that you have to carry the tax burden on a city residential lot that is valued at $20+/ sq ft, the probability of bringing in a single-wide trailer house and junk cars starts to decline

Texas population projections say going from 30 million to 45 million in next 25 years, plus or minus.

With a 50% growth in population possible in our lifetimes, you tell me what is going to happen to real estate prices in Texas . . .

HumpitPuryear said:

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kag00 said:

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Texas does need to get the property taxes under control. It has become a never ending wealth tax that is impossible to escape and must be paid just to live. For a retiree with little to no income it is actually more expensive to live in Texas than other places even if you own a home free and clear.

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We are a couple years out from retirement and are already looking out of state. Never thought I would even consider leaving Texas but property taxes are going to be brutal for retirees. Sure they are kinda capped but if you are already paying $10k+ per year plus escalating insurance it makes a lot of sense to move.

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Yep, I'm a native and left after 58 years when COVID lockdowns shut my business down. Moved to a hot up and coming market in another Southern red state. It worked out great, though, I miss the heat and allergies. I still and always will claim Texas as my native state. Lover her attitude.

Mas89 said:

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oklaunion said:

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techno-ag said:

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Yeah had to help some folks out on this not long ago. Widow filed the paperwork and deferred taxes for years. She died and her heirs were stuck with a big bill. They would have liked to keep the house but never would have been able to catch up on the back taxes, so had to sell.

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Well, at least it worked for her and I'm sure that is all she was concerned about.

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This. It was the widow's house/ money to spend and not her heirs. They only get what's left. If anything.
And that's the way it should be.

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Just to be clear, they would have preferred to have her still among the living. They were not expecting or wanting anything from the woman. But they also were not expecting to have to deal with the mess of a house deep underwater on taxes. That led to a whole new level of stress. I helped best I could from a distance but yeah after the funeral they were thrust into a world of debt they had not been expecting to deal with.

Saltwater Assassin said:

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A little bit of anecdotal data here: I own a small custom home building company, and my wife owns a small real estate brokerage. On the real estate side, resales are slow, very slow. Seller has to be very conservative on price & the home has to have zero issues in order to have a chance to sell. Even those homes are sitting on the market way longer than makes sense to us in previous markets.

On the Custom home side higher end stuff seems to be moving along pretty well. Not coincidentally those buyers are heavy, cash or all cash.

New construction and resale anything with a large Mortgage is really really slow or nonexistent.

It's a tough market to figure out in central Texas, we are just seeing things that we are having a hard time reconciling and understanding. All that to say this: I would not consider our current residential real estate market to be healthy or robust in any way. I can honestly say, that having done this for the better part of 30 years, I really don't know what to expect in the short term.

Best of luck out there to all the sellers and buyers as it is a tough time to figure out and negotiate the proper path forward for your respective families.

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95% certain we've worked with your wife to buy. She is an expert! We haven't met anyone who knows how to navigate the central Texas real estate market as well as she does. Great experience and wouldn't want to work with anyone else!

DDub74 said:

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Texas population projections say going from 30 million to 45 million in next 25 years, plus or minus.

With a 50% growth in population possible in our lifetimes, you tell me what is going to happen to real estate prices in Texas . . .

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Right now they are poised for a major drop

samurai_science said:

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DDub74 said:

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Texas population projections say going from 30 million to 45 million in next 25 years, plus or minus.

With a 50% growth in population possible in our lifetimes, you tell me what is going to happen to real estate prices in Texas . . .

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Right now they are poised for a major drop

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Unless there is massive deflation paired with interest rates continuing to rise while unemployment continues to rise, I'd be surprised to see a major drop anytime soon except for maybe areas of the state that have overbuilt (big maybe). What areas of the state have overbuilt?

There's people who always say the stock market and the real estate market are poised for a big drop.

Eventually they will be right. But how far away their prediction is from fruition is the real determining factor if they are right.

Thanks man, thats always great to hear!

Im pretty partial to her!

Insurance is crushing most new landlords.

Small regional banks with commercial real estate exposure are going to fold up/ be bought out by larger banks once their stockholders realize the loans on the books isn't worth the paper it's printed on.

Lots of B&C class apartments are underwater. People bought these things at 4 & 5 caps. If you bought a 4 cap every point it expands requires you to be 25% more efficient to MAINTAIN the value. So all 'value add' investments are break even at best now. A 5 cap is 20% per point of expansion.

So when these regional bank balloons hit, or their rates adjust, combined with insurance going up, the property can't carry itself anymore. The banks know this and try to work with the borrower vs foreclose, demand a refi, or ask for a big principal pay down. They just extend and pretend to protect their own balance sheet.

I'm having lunch with the CEO of a small regional bank today so will ask him about this and report back.

DDub74 said:

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I'm having lunch with the CEO of a small regional bank today so will ask him about this and report back.

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Proposition Joe said:

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There's people who always say the stock market and the real estate market are poised for a big drop.

Eventually they will be right. But how far away their prediction is from fruition is the real determining factor if they are right.

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Some people understand warning signs and use them to prepare.

Others stick their heads in the sand.

Nobody knows when it's coming. It just happens and the economy expands again (hopefully).

Heineken-Ashi said:

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Proposition Joe said:

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There's people who always say the stock market and the real estate market are poised for a big drop.

Eventually they will be right. But how far away their prediction is from fruition is the real determining factor if they are right.

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Some people understand warning signs and use them to prepare.

Others stick their heads in the sand.

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What does that even mean?

There's going to be a real estate crash. OK. So...dont buy a house until it happens?

The stock market has been over inflated for years. Consumer debt is unsustainable.

Most people understand these houses of cards are going to collapse, but few can predict when.

But many will claim they foretold it, even if it disregards missing massive gains by always thinking it's just over the horizon.

Burdizzo said:

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Sid Farkas said:

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Coastal big city California homeowner & retiree here…I've carefully run the numbers on retiring to Tx, and it doesn't work for me. My prop 13 taxes are low, and my taxable income has dropped to where Ca state income tax is tolerable. I'll stay here and dodge the homeless and enjoy the year-round good weather.

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I have said it before that one overlooked benefit of high property tax burden is that it helps keep the riffraff out.

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SF would beg to differ.

Proposition Joe said:

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There's people who always say the stock market and the real estate market are poised for a big drop.

Eventually they will be right. But how far away their prediction is from fruition is the real determining factor if they are right.

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A doctor who worked for me in SF was waiting patiently for a correction before she'd buy a house. As prices double and tripled, not sure that waiting for a 10-20% correction would've been all that beneficial...

Proposition Joe said:

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Heineken-Ashi said:

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Proposition Joe said:

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There's people who always say the stock market and the real estate market are poised for a big drop.

Eventually they will be right. But how far away their prediction is from fruition is the real determining factor if they are right.

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Some people understand warning signs and use them to prepare.

Others stick their heads in the sand.

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What does that even mean?

There's going to be a real estate crash. OK. So...dont buy a house until it happens?

The stock market has been over inflated for years. Consumer debt is unsustainable.

Most people understand these houses of cards are going to collapse, but few can predict when.

But many will claim they foretold it, even if it disregards missing massive gains by always thinking it's just over the horizon.

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Making sure your money is in a safe bank. Making sure your risk to the downside is minimized in your portfolios. Not being over levered, whether its real estate, trading, consumer loans, etc.

Pretty simple stuff. I get it you can't do it. But some of us can.. and can still participate in gains while we do it.