Wednesday, June 20, 2012
Realtors push hike in property tax
There is no real estate transfer tax (RETT) in Oregon and there doesn't seem to be one on the horizon anytime soon.
But, that hasn't stopped Realtors from asking voters to block imposition of any real estate transfer tax in the future.
A RETT is a tax shared by buyers and sellers when a property is sold and it helps fund government, which finances such things as road construction, public education and public safety.
Oregon has no sales tax.
So, it leaves income and property taxpayers to carry the heaviest freight of government funding. And, the income tax has only been raised once in the past century.
But, what Realtors are saying is that if government needs more money, just jack up property taxes more. Oh, and just increase the tax on residential, but not commercial, property.
It's the same argument used by the beer lobby, which has successfully blocked any increase in Oregon's beer tax, one of the lowest in the country.
Put the burden of government funding on property owners, they say, not us.
What happens, then, is that homeowners get enraged about their escalating property taxes and vote no on property tax measures placed before them.
This, in turn, further depletes government resources, which leads to crumbling roadways, inferior schools, particularly in higher education, and decreased public safety.
In other words, the overall "quality of life" diminishes, which apparently doesn't mean much to Realtors, who, nevertheless, use "quality of life" as a major selling point, particularly in Central Oregon.
The reason why Realtors don't want a real estate transfer tax is that it can be used as a bargaining chip during negotiations.
"Yo, you eat the RETT and I'll take the rest."
Basically, it could slightly reduce the ridiculously high commissions Realtors extort for doing little, actual work. That is the only reason why Realtors are opposed to a RETT.
In reality, there is no evidence that a RETT kills real estate sales.
But, what it can do is slow down the "flipping" process by which Realtors and some builders try to cash in on a hot market.
We saw what happened to Central Oregon during our hot times in the last decade where, thanks to speculators like Realtors, Bend became the most over-valued real estate market in the country.
Naturally, during the crash, Bend then led the nation in plummeting home prices, which led to foreclosures and bankruptcies by the score.
A RETT won't eliminate such irresponsible behavior by the realty and building sectors, but it could put a slight damper on real estate speculation that eventually devastates a community.
And, a RETT could actually improve the vaunted "quality of life" by helping fund government services.
You would think a Bend Realtor would be in favor of such a thing.
In any case, vote against anything a Realtor proposes this November.