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Property Taxes

Ralph Hood

Holy cow! We just received our property tax bill, and we are amazed.

In the first place, they appraised our house value higher than we sincerely believe its worth, and we can prove our sincerity. We will gladly sell the house to the city and/or county at the appraised value.

Ralph Hood
Ralph Hood

We wonder if the powers-that-be-know that property values have gone down drastically since we bought the house in the middle of 2007. The country has been in a cataclysmic depression since then, and this property has definitely been a participant. Not only that, but regardless of what Obama says, the drop in property values is likely to continue that decline for quite awhile into the future.

The taxing authorities no doubt believe I am wrong, and that the house is worth exactly as they valued it. Think of the argument that could ensue.

But, fear not, I have the answer.

I remember from my not-so-distant past a type of stockcar race in which each driver swore that his/her car was worth no more than a stated amountósay $500. The purpose, of course, was to make it possible for poor (or cheap) folks to compete in a race with cars of the same value. This type of race brought on much argument as to who was lying to whom about the value of the respective cars, losers often claiming that the winnerís car was worth far more than the stated value. The winner, of course, vowed the car was worth not a penny more than the stated amount, and maybe less.

The racetrack certainly did not want to participant in these arguments, much less be the judges, so they came up with a simple solution. After each race the loser could buy the winnerís car for the stated value. The winner had to sell the car for that price. This solved the problem instantly. Every driver was scared to enter a car that was actually worth more than the stated value, lest he/she be forced to sell it too cheaply.

Back when I was selling airlines, two people often formed a partnership to buy and operate an expensive airplane. One of the logical questions (although the buyers often didnít think of it) was ďIf one of us needs to sell out, how will we figure out a fair price for his half?Ē Thatís a very logical question.

We urged the partners to have their lawyers include in the partnership agreement a simple rule. If Partner A wants to sell out (this often happens during a divorce), he will come up with what he thinks is a fair value for his half of the aircraft. Partner B will then have the option to buy half the airplane for the quoted price or to sell it to Partner A at that price. In either case, one of them will then own the entire airplane and can sell it on the market or keep it. Very simple and very effective.

Saves a lot of acrimony and court expense.

This was a lot like the way my mother decided which kid got which piece of pie or cake. One sibling cut the pieces, the other got to choose his/her piece. That made for some very careful cutting.

I hereby suggest that property taxes should be evaluated in the same way. The taxing authority sets a value on the property. The owner can then either pay the tax or sell the house to the taxing authority for what the authority said it is worth.

Wouldnít that be fun?
 


Ralph Hood is a professional speaker. His speeches and workshops, which have helped rocket engineers, salespeople, physicians, educators and health professionals with team building, motivation, customer service and sales, provide hardworking, bottom-line information that can be put to work in the real marketplace tomorrow morning.
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