Quote:
Originally Posted by PoorLurker
Yea - being a teacher in SF/Oakland seems like an unwise thing to do unless you have family money or a partner who can help increase household income. That rent is ridiculous!
Bad thing about moving up is the increased cost of property taxes. Even if you carry equity from one home to another, you are still faced with a large increase in property taxes.
A friend I know just had a house in his neighborhood close escrow that increased his networth by a couple hundred thousand practically overnight. If my friend sold his house to "cash out" took that equity and applied it to a new house, he'd basically be paying 1% of that $200k per year in taxes. So he just added nearly $200/mo to his debt for...the....rest...of...his....life (or until he sold)
Yes- the $200k nicer house may appreciate more but there are always many variables to look at
|
There were stories of homeowners around the DC Metro area that got hit with the very thing you're talking about with property taxes during the first housing boom. The timing of their county to reassess the property valued happened right at that moment. Many of the homeowners found that they couldn't afford their homes overnight due to the explosion of assess value of their homes from the market frenzy.
I seem to recall because of this many of the local municipalities implemented changes to cushion the shock in future reassessments.