This question can be posed for just about any County on the map.
This is an unusual Market Report. But, our Market may see changes very quickly.
Montgomery County is truly being affected at this point. This is really a scary question to ask since it does have an answer. First of all what would or could cause the property values to drop?
Obviously the economy has something to do with it as the Lender's hesitation to loan money causes a higher demand for qualified Buyers. So, it's a given that prices will drop when there are more Sellers and less Buyers.
At this point a verifiable qualified Buyer has a great deal of strength. With less Buyers, less homes will sell. Prices drop out of basic need for a sale and "voila" we have a Buyer's Market.
The question is, "will our County Taxes rise if our property values drop?"
Wait, there's more. We are all aware of the critical status of our drought. Lake Conroe may drop by 11 feet below normal level by January 2012 if the rain continues to evade us. This status is based upon the amount of allowed water acres to be drawn by The City of Houston. We are not going to deplete the lake in this amount of time as we should have a five year window allowed before it goes totally dry. But, what will happen, and has already begun to happen, is the stress and economic duress that water loss causes affects our local businesses.
All stores with gas pumps, restaurants, boat mechanics, marinas, jet ski rentals and boat rentals and basically everyone is feeling the drop in tourism.
Loss of income = Loss of value of the business.
If business values are dropping this is yet another reason our home prices may bottom out.
Oh yeah, the question is, "will our County Taxes rise if our property values drop?"
Unfortunately the answer is a resounding "maybe" with a "probably" following shortly thereafter. With property values dropping, both commercial and residential units will be paying a lower amount of tax based on value. The County will then be collecting much less than normal. The County, as most do, runs on a budget and their expenses must be met. Should the current Tax Rate not cover the needs of the County then invariably the overall Tax Rate must rise to fill in the gaps.
***Major Pep Talk!***
Let's all just keep our chins up. All is going to get better. It's going to pour down rain, businesses are going to flourish, the Feds are going to relax with the Lending laws, Buyers will come back out in groves, our property values will strengthen and we will all recoup our equity. Our lives will turn around completely and our Taxes will drop!
Now, that's optimism. Get some too. We all need it. Thanks for reading.
Check out my website at: www.debs-realestate.com.