We need to be aware of the dangerous real estate tax battle going on right now in New Jersey.
As many of you already know high [tag-tec]property taxes[/tag-tec] as well as any kind of new real estate taxation are subjects that get me riled.
But leave it to municipalities in New Jersey to come up with a novel way to squeeze even more tax revenue out of the most fav cash cow, real estate.
Taxing property sales by 0.1 percent.
Those who are for this new tax say it’s small… only $462 on a $462,500 house, for example.
But isn’t that what they always say?
But what about the state realty transfer tax New Jersey home sellers are already paying?
Okay, so what’s another $4000 when you’re already paying out $462,500 on a house, hmmm?
Here’s what’s happening-
Proponents say the small hit for homeowners would generate thousands of dollars in revenue for cash-strapped local governments. As all real estate investors are so painfully aware- Municipalities raise most of their revenue through property taxes.
This year, the state of New Jersey has placed new caps on how much towns can raise their taxes.
So… you can fill in the blanks. If you guessed they’ll be making up the tax in other ways you’re going to the head of the class.
For real estate agents and sellers, the proposal comes at the worst possible time, just as buyers have vanished.
When will municipalities learn?
But The New Jersey Association of Realtors is waging a high-profile campaign against the measure, running radio ads and collecting 15,000 signatures from residents in opposition, according to a spokesman.
Lawmakers representing Jersey City, one of the state’s hottest housing markets, wrote the bill last year.
It has yet to move from committee, but critics fear that lawmakers could pass the bill during the lame-duck legislative session beginning this week.
The best weapon is information. As long as buyers and sellers know what’s going on they can make up their own minds. They can also tell their representatives what they’ve decided. Will they listen?
Energetic Tennessee voters successfully fought a state income tax several years ago by getting the word out-by car horn.
When lawmakers stopped taking phone calls and emails, citizens took to their cars driving around Legislative Plaza and honking their horns for hours and days.
Call it torture, but it worked.
The real estate tax fight in New Jersey is important because it could eventually trickle down and affect all of us.