The arrival of our 2010 property tax statement in the mail last week has thrown me for a loop. I don’t know why, though, since my head hasn’t been stuck in the sand and I am acutely aware of plummeting property values.
Let’s consider the positive first. Our proposed 2011 tax, without special assessments, is dropping 22 percent. Yahoo. I like seeing that minus sign before a double digit number in the tax column.
If everything remains as projected, my husband and I will pay $506 in property taxes and $22 in special assessments next year. I can handle that.
About now some of you are probably wondering whether we live in a cardboard box with those “low” taxes. I assure you that we live in a modest, small-by-today’s-standards, old home along a busy street in Faribault.
Now back to those numbers on that statement. When I look at the taxable market value of our home, I’m not quite as enthusiastic. Let me restate that. I am not at all enthusiastic.
The value of our 1 ½-story, one bathroom, three-bedroom home has dropped 13 percent from $92,300 to $80,200. That’s a $12,100 decrease.
I am a bit surprised by this dip below $90,000, although I really shouldn’t be given how slowly houses are selling, if at all, in Faribault or anywhere. Yet, you like to think that your house is immune from devaluation. Clearly ours, once valued as high as $111,700 (in 2007), is not.
My curiosity piqued, I opened a file cabinet and pulled out past property tax statements and bills. I compared figures back to 1998.
Our proposed property tax and taxable market value on our home today nearly match those for 2003.
This current devaluation is all a bit depressing and would be even more so if we were trying to sell. But we’re not. The house is paid for and we have no specific reason to move.
That brings up another issue. When my husband and I purchased our house in October 1984, the fixed interest rate for our 30-year mortgage was 10 ¾ percent. Eight years later we refinanced to a 8 ¾ percent, 15-year loan, which we paid off early.
So, when I hear about mortgage rates hovering around four percent today, I feel a twinge of jealousy. Even factoring in today’s housing costs compared to 26 years ago, we could have bought so much more house with an interest rate that incredibly low.
But it is what it is and I’m glad we’ve stuck it out in the same house for nearly three decades. We’ve invested hours and hours of sweat equity and money to improve our house and it’s paid for. In today’s economy, I like that feeling of security.