Real Estate taxes

Governments fund themselves via taxes as we all know. There are varying forms of taxes but a common one in the US is a tax on real estate by local towns and municipalities, perhaps this is common worldwide - don't know.

For years real estate in the US had a relatively uniform value so this tax performed well. Over the last 20 years or so real estate values have skyrocketed with varying factors resulting in some significant valuation differentials between fairly similar properties. An easy example of this would be waterfront property versus inland property. Otherwise identical properties in the same town have radically different values based upon proximity to water.

Many towns and/or states have laws on the books that require the re-valuation of property for tax purposes on a regular basis, some don't and just adjust values when sales occur but that is becoming less common. This re-valuation has led to the proverbial land rich, cash poor phenomenon among many long time residents of now valuable property. By nature, long time residents tend to be retirees on fixed incomes with the result being a forced sale of the property to avoid bankruptcy via real estate taxes.

Real Estate taxes tend to go to the local governments (with exceptions of course) and pay for significant indirect benefits such as police, fire, roads, schools and parks. Since the benefits are indirect it isn't possible to charge the folks using the services directly as an alternative means of paying for them.

My issue is that I don't see it being fair to charge an elderly home owner with a choice piece of property significantly more in taxes then a family of four living in a similar home. I feel that thier tax burden should be similar as well.

Some may feel that the tax system is fair since it taxes the rich but this isn't true. Many long term property owners are not rich and simply scored in the real estate lottery IF they should decide to sell.

As a result of the current system many pieces of real estate can only be sold to developers who split up the land and cram in as many homes as possible leading to the rabid development currently seen in the US.

I feel that the current Real Estate taxation system needs to be amended. I don't know the perfect solution and doubt there is one but feel a greater fairness can be attained and should be. I do not believe that there should be any attempt to align the taxes with usage of services - the family with children in school might be getting a bargain today but they compensate for this later in life when they assist in paying for their grandchildren's educations and so on.

Will politicians step up and improve this broken tax - of course not, the folks with expensive properties already know they are getting screwed so why upset those getting the bargains? Too bad, someday the system will break and then they will be forced to take drastic action.