Quote:
Originally Posted by FlyingScot
I agree that no one should be taxed out of their home. But it's hard to summon outrage when it's a second home that has appreciated hundreds of thousands (a million?) in value, and the town is asking for a piece of that appreciation back. People in this situation are WAY ahead financially.
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Actually they are not. Most property owner end up on the loosing end, secondary properties are by far the worst.
Towns don't just take all the appreciation of a piece of property they actually take MORE than that. Example, my primary residence has a little more than doubled in value over the last 20 years. 100% increase in value means I'm a rich guy huh? Um NO! While my property value may have increased by 100% if I add up all the property taxes I have paid over the past 20 years I have forked out the equivalent of 137% meaning I am in the hole 37% JUST IN TAXES. Now if I were to sell I'd be out another about 9% off the top between RE transfer tax and real estate commission.
Secondary homes are far worse as using the same numbers... add in an additional 15% tax on cap gains. LOL yes the gains you have already paid the equivalent out to the town in the form of taxes.
Bottom line real-estate is a terrible investment to hold - in fact I wouldn't call it an investment at all - it's a way to park money that is relatively safe, and the town via property taxes gets all the interest earned and then some.