Comments ( 29 )

• Its too bad we can’t apply these new taxes only to people who voted for Stroger, Daley or Blagojevitch.

• I have yet to hear REALTORS propose an alternative solution. As a homeowner, I think the transfer tax is totally worth it. I would rather pay a $1,000 more when I buy a home to sustain viable transit than go cheap and have to wonder how much longer transit will be an option. The real estate lobyists seem to be overlooking just how much the value of homes in Chicago relies on our transit system. If we let it crumble, you can bet it’ll have a negative impact on home prices. I would certainly consider moving away from the region if the cuts take effect next week.

  Last year, NAHB found that the second greatest locational impact on home price is, of course, transit (second only to waterfront, but ahead of close to the water).

  http://insidenova.com/servlet/Satellite?pagename=ISN%2FMGArticle%2FISN_BasicArticle&c=MGArticle&cid=1149193135657&path=!lifestyle!homegarden

  How constructive is it for realtors to rail against a transit solution that will provide a significant benefit to real estate without providing any alternative proposals?

• From 1998- 2002, I was able to I was able to negotiate seller picking up the fee in 5 out of 8 transactions. Was tough to do from 2003 to 2006. In current environment, I would recommend buyers get agressive and ask the developer or seller to carry this. One way is to do what the developer does, add it to the fine print of your long list of list of offer requests.

• it seems illogical to me to single out homeowners for what is a larger societal issue –

  otoh, having a transit fee included in NEW construction makes 100% sense – new units mean new demands on the infrastructure, so let the users help carry their weight.

• FWIW New construction doesnt always mean new demands on infrastructure. When u tear down 2 3-flats, with renters, taking the “el” to work, and replace it with a McMansion, with a 3 car garage, the demand on infrastructure would reduce; in this new construction scenario.

• yeah, but I really dislike the McMansion-ation of Chicago, it’s not an improvement to have new residents who only drive and never use the CTA. : )

  in all seriousness though, the McMansion likely is adding a burden on the infrastructure – every time I’m in an area where there are those going up it’s not long before you see streets and san tearing up streets, presumably for sewer or other improvements.

• I agree with the dislike for McMansions, and their taxing on infrastructure other than public transit. My point was in relation to a transfer tax for CTA’s benefit, and your post saying it makes sense to tax new construction due to the new demands on the infrastructure (CTA). This is not the always the case as in the scenario I described.

• Highways are infrastructure, too. If you lump it all into one category of public-funded “infrastructure,” it’s not obvious to me that the 2-3 flat is less of a drain than the 3-car McMansion.

• Whoops, I meant “more.”

• Why can’t “we” just raise the gasoline tax? It would make a lot more sense than a real estate or sales tax. Anybody else take economics in college?

• This “tax” is to fund the pension of CTA workers, right? Not necessarily to maitain the infastructure.

• “it’s not obvious to me that the 2-3 flat is less of a drain than the 3-car McMansion.”

  I suspect per capita the 3 flat has less demand, but I would be quite content if such a tax were only applied to an actual increase in housing units.

  of course, we all know this is just a money grab, there’s no real logic behind it outside of “who won’t be able to prevent this tax from happening”

  re: a gas tax, well, that just makes too much sense, that’s the problem.

• I would love to have a mass transit system on par with that of major European cities. But that will never happen.

• If government wants to score an enormous windfall from the real estate industry, all they have to do is give every property owner the option of purchasing an upzone. It’s free money without a tax, and it would stimulate rather than depress the economy.

• Most property owners already have that option, depending on what ward they iive in.

  There’s an economic stimulus as the aldermen spend their ill-gotten gains.

  How about taxing the entire city equitably, instead of simply slamming the lakefront? Enforcing parking ordinances equitably across the city? Taxing pols’ residences at the same rate as everyone else’s? Slimming down the city council and the bloated bureaucracy? Etc.

• …until all the sewers & power lines & streets collapsed from the extra usage, anyway.

  just look at a comment above:

  “I would certainly consider moving away from the region if the cuts take effect next week.”

  Don’t bank on the current crop of homeowners sticking around to help maintain/repair the infrastructure that wasn’t in great shape before all the extra demands were placed on it.

  For some of us, this is our home & our community, and although we grumble and complain about the corruption and the problems, we’ll be here to deal with the problems, for our kids’ sake if nothing else.

  For others, Chicago is a place to hang out & enjoy urban amenities, at least as long as the going doesn’t get too tough – but history is pretty clear that the going eventually gets tough no matter where you are.

• cross post, that was (hopefully obviously) in response to pk.

  joe makes good points, but it’s bigger than just Chicago, the corruption is endemic state-wide as well – we need to quit using property taxes to fund education, or move to an acquisition-based property tax system (combined with a more progressive state income tax), period.

• complaining that the transit funding solution is unfair to buyers? gosh. are you also wallowing in self-pity that the title companies keep raising their charges every year? crying to fannie/freddie over their new pricing structures or to the private mortgage insurers who are raising their premiums? upset that home prices (until recently, anyway) have been trending up? all of those things make it harder for buyers to buy. the stinking transfer tax increase isn’t going to be a deal breaker. jeeez. (when was the last time it increased, anyway?)

  Come on citizen, buyers are going to be helping sustain mass transit for EVERYONE’s benefit. Even if you don’t ride, at least it will keep other cars off the road so that you can sit in a little less traffic.

  the real fun thing about the proposal is that its not the state legislature or the governors purview to raise the city tax. its up to the city counsel. isn’t it?

• The transfer tax is totally inequitable. Government is based on equity of services… for instance, sending a card snail mail will cost you the same to send it down the treet of five states over.

  What you get is less quality service, but at least a service available to everyone. Everyone pays and everyone “enjoys”.

  Yet, all these drive-by inequitable taxes. Tax on purchasing property that was already there, a free ride on a bus over here… WTF?

  What a game.

• well, it is and it isn’t – we all pay money for public schools, regardless of whether we have kids or put our kids in them, not based on a dollar-to-dollar transaction for payment-services received, but because society has deemed that it is an investment that pays back all of us via less crime, more prosperity, etc.

• So many disparate thoughts so much need for me to bring light to the darkness.

  I’m felling narcissism of metaphysical proportions coming over me…..just call me Blago.

  First, Joe Zekas wrote:

  “How about taxing the entire city equitably, instead of simply slamming the lakefront? Enforcing parking ordinances equitably across the city? Taxing pols’ residences at the same rate as everyone else’s? Slimming down the city council and the bloated bureaucracy? Etc.”

  1. The city is far closer to being taxed equitably than in the distant past of your memory. My southside property owning relatives can attest to that change and whine about it all the time. They are now paying around 1% a year, in terms of real property value, as property taxes. Ten years ago they were paying taxes at about 60-70 percent the real percentage rate of lakefront owners. Now I suspect it is 90 percent or better. Houlihan has been bringing it closer into line the last few reassessments. That is anecdotal, but between my large family many properties are owned north and south and I recall some legitimate news stories about the changes. I’ve also put together the appeals on various properties for my relatives and am intimately familiar with what they pay. I do the work and they go downtown to the county building. It’s not that difficult particularly after you do it once. Just file the same basic appeal every 3 years.

  2. Parking ordinances get enforced more in lakefront hoods because of lack of parking. Sending the city booting crews to low density wards generally doesn’t generate as much revenue as sending them north. The folks in low density areas have more parking available consequently they get fewer tickets per capita.

  3. As for taxing pols residences equitably and cutting the size of the council etc I am all for it. Ten alderbeasts would be enough, although for complicated ethnic and demographic reasons eleven might work out better to get some type of balance.
  We like to balance criminality by ethnicity in our council.

  Now as to other comments taxes are always unequitable. Someone always pays more than they get back. Personally I would raise the exemptions on the state income tax and raise the rate while reducing sales taxes and all the other non property taxes out there. Income taxes and real estate taxes are federally deductible and while they don’t benefit everyone they do shift part of the burden to other taxpayers outside Illinois.

  Hooray for me. “Don’t tax me, don’t tax thee, tax that guy behind the tree.” With thanks to Royko.

• irishpirate,

  There are many lakefront condo owners who would weep for joy if they could pay only 1%.

  I did a brief review of about a dozen MLSNI Beverly listings and didn’t find anything at or over 1%, discounting the asking by 10%. Did find several in the range of 3 to 6 tenths of 1%.

  Perhaps it’s your relatives that are being taxed higher. Makes sense that they’d be singled out.

  There are high-demand parking areas on the southwest and northwest sides. Lakefront density is not the simple answer to differential enforcement that you suggest. You’re being disingenuous here.

• I’m not being disingenuous. As for assessments as you know they vary greatly. Right now I’m paying about 9/10ths of one percent of real value in Uptown. Which is less than the city wide average which I understand to be 1.1 percent or so.

  I didn’t suggest the disparity disappeared I just said it lessened. It has. I probably should have said about 8-9 tenths of one percent as opposed to 1 percent. I have relatives in $400,000+ homes on the SW side who were paying taxes of less than $2000 per year a few years ago. Now it is over $3500. I remember my mom complaining about $900 in taxes on a home worth $250,000 at the time. I remember because I end up paying her taxes and buying her a new car every 4 years because after that hard 5000 miles a year she puts on a car she gets nervous.

  As for MLS tax listings I would go straight to the government websites to double check. If the realtors are using the numbers from prior to the last reassessment the numbers will appear much less. Since we get taxed a year behind in Cook County the year they choose to post can be crucial. In the last reassessment the lakefront areas percentage increase was less than most other areas of the city.

  I will agree that the lakefront condo owners generally get hit harder. The reason is simple. The former assessor was from the 19th ward and even Houlihan has roots in the 19th ward. Now he lives in Lincoln Park. I don’t claim it is right.

  As for parking on the SW or NW sides outside around a few colleges or train stations there is nothing that remotely compares to the parking situation in Lincoln Park or LakeView. If there is please enlighten me. I spent years while in college making courier deliveries and I don’t think there is a neighborhood in this city I haven’t been in. Of course that was long ago and I rode a horse yet………

• hmm, posts by the pirate I largely concur with. might be the Cubs’ year to win the Series after all.

• irishpirate,

  So, parking’s not an issue in the Six Corners area? Must be only when I’m there.

  Not an issue in Pilsen or Little Village or 79th St in Chatham or 103rd St in Beverly? Must be only when I’m there.

  You now seem to be conceding my original point that parts of the city are unfairly under-assessed or over-assessed.

  At least you go out with a flourish – a pirate on horseback!

• Carter, I do hope the Cubs win the World Series. It would bring joy to my heart to see whiny Sox fans complaining. I pay little attention to sports and I’ve never understood the pathological hatred many Sox fans have for the Cubs. The best part is pointing out to Sox fans how little Cubs fans think about the White Sox. “I hate da Cubs fans” to which I usually say “Cubs fans barely know you exist.” Drives em nuts and then they start spewing about how “the sout side(read white south side) runs the city”.

  After the Sox won the World Series I read some story about some Sox fan who spent hours in a truck circling Wrigley with Sox Flags everywhere on the truck. What a stupid gesture. Stupid guy I imagine.

  Of course Carter I would tear down Wrigley and put up a real stadium, but I imagine some people would literally die of despair if that happened.

  Joe, I don’t know Little Village or Pilsen well enough to comment on the parking situation there. However, this is YoChicago and knowledge or actual experience doesn’t stop many people from commenting so here goes. I doubt the parking situation in those neighborhoods is as bad as east LakeView or Lincoln Park. I know Six Corners well enough and the parking situation there is not comparatively bad. Comparatively meaning the lakefront versus greater Portage Park. As for Chatham I think it matters how close you are to the expressway and the main streets. The expressway meaning access to the Red Line. Chatham is an area I have experience with, but like me it is old experience. You will also notice that I mentioned train lines as being areas where parking may be an issue. That partially explains the issues at 103rd street. Which is a street I have traveled down thousands of times.
  Another area you could have mentioned is the hospital district. Parking is tight around there.

  I also never disagreed that assessments between the north side and south side were skewed in the favor of the south side. More particularly highrise versus anything else. I just said the disparity has lessened. One of my brothers lost 60 pounds a few years ago. It doesn’t mean he isn’t fat. He is. He is just less fat.

  Over time the assessor seems to be trying to reduce the disparity. Maybe it is not purposeful and it is just a matter of property values rising at a faster clip out south. I have no special insight to the workings of the Assessor.

  Now on to tearing down that wreck of a ballpark at Addison and Clark……..

• And now for something completely different.

  Ran across this on Slate Dot com.

  Black Chicago 1946-1948. Not sure how it fits here, but it is interesting.

• Nice catch, pirate.

• Lee is right: the availability of public transit adds thousands of dollars to the value of every property in the city — particularly the downtown commercial properties which are valued at closest to “par value” (and which pay a much higher property tax rate than we homeowners, anyhow). It’s only fair that those of us who profit from transit pay to support it.

  Indeed, I’m a stickler for “taxation nexus,” the logical connection between what’s being taxed and what government service that tax pays for. Schooling raises incomes, both individually and socially, so we should pay for schools with an income tax. My own condo’s value has nothing to do with the nearby schools, but everything to do with the nearby “L” stop — my property taxes should fund that service instead.

  “Value capture” (capturing the enhanced property value that transit brings) not only funded the construction of the “L” and the transcontinental railroad, but it’s funding new rail lines in modern cities like DC, London, and Tokyo. It just makes sense.