Real Estate cool-down

[Go Plainedge!]

According to a CNN Money report, the New York area real estate market is expected to cool off.

The median home price is $395,000. The forecast for 2006 is a 2.3 % loss or drop in price.

So, my question is this: If Nassau County bases our taxes on the value of the home and values drop, does that mean our taxes follow suit?


Link to article
money.cnn.com/2006/02/03/real_estate/house_price_predictions_for_2006/index.htm?section=money_topstories

[justfacts]

Go Plainedge!

Housing - Market Value Changes.

Sorry Charlie! That's not the way it works!

If the Market Value in an area goes up, or down, the Taxes - hold onto your hat now - Does NOT change!

The Assessed value (at 0.25% of Market Value here in Nassau) will go Up or Down - and the TAX RATE will do the opposite - go Down or Up in exact same proportion. It's much like a See-Saw - if one side goes Up the other side goes Down. This leaves the overall Tax Levied unchanged!

That Levy is set by either the School Board (for School needs, about 66.67% of our total taxes; for Library needs about 3.36% of the total tax) or by the Town (about 29.97% of our total taxes). The Town then uses the RATE times the Assessed Value to figure the Tax on each Home.

Since the average Market value you used was $395,000 that means that "average house" is assessed at $987.50

If YOUR particular home is reduced in Market Value (or Assessment is reduced) compared to your neighbors, then YOUR tax will go down - and all other homes will pick up the difference!

There are 6242 homes in our School District so it would take quite a dollar reduction in your assessment for all other homes to increase by 1 cent each!

BUT! There is a way that the overall Market Value change WILL affect how much each of us eventually pays in just the School portion of the taxes.

Since the School Budget is also supported by State Aid AND since State Aid is calculated on the Paper Wealth of the District - an increase in the Market Value of all our homes will cause the State Aid to drop in like proportion! That means that the School Tax on Property will increase to make up the difference in State support!

Since the State Aid is already determined for 2007/8 (as are the Market and Assessed Values for all Plainedge homes) - don't look for any actual home value decrease, if it should occur, to show up until well into the next decade!

It will take the State at least that long to calculate the new lower values! Right now, much of the State's figures are "current" as they call it, using the values from 2003!

So, once again Charlie, "So Sorry Please" - but it doesn't work that way! AND the reason it doesn't work that way is:

The State Aid is based on PAPER GAINS in Property Values - no other entity does this! Even the IRS does not base its TAX on our PAPER GAINS!
[/i]

Ed

[justfacts]

Figures for State Aid

Here's some local School Districts and the percentage of their Budget that comes from State Aid. As mentioned in the prior post, these numbers are current State Figures from the year 2002-3 comparison charts.

Bethpage ______11.28%
Carle Place______8.08%
Farmingdale____18.72%
Hicksville ______11.86%
Jericho _________5.34%
Locus Valley_____6.45%
Massapequa____17.33%
Oyster Bay______6.53%
Plainedge ______25.73%
Plainview ______11.78%
Syosset ________7.01%

If anyone is interested in the Property Wealth per Pupil or the Income per Pupil send me an e-mail. I'll return the full chart in PDF format.

It clearly shows how paper gains in Property Value strongly influences the State Aid formula. For instance, Carle Place which has about the same Income/Pupil level as Plainedge has their Property Value per Pupil listed at almost twice the Plainedge amount. Plainedge has the lowest Wealth Ratio of those listed (1.243), Oyster bay has the highest (4.385)

If, or when, updates come in I'll post them.

Ed. [e-mail]

[Go Plainedge!]

Do you have a link for the website that you got that from?

[justfacts]

Go Plainedge!

Ref. Your request for website link.

Yes I do. It containd the link to Table 4, where this data was extracted from.

But I warn you - it contains data for all school Districts in NY State and getting to the Plainedge data wil be a chore!

Table 1 is also pretty interesting. It contains actual dollar amounts. Although it too, contains all the Districts and requires work to get at the Plainedge figures.

It takes one heck of a lot of reading to get this info - but the amount of truth there is worth the effort.

Fiscal Report Site for NY State Education Department:

oms33.nysed.gov/faru/Profiles/16th/statewide_fiscal.htm