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[–] 2 pts

Yes its based on home value when value lowers so does the tax rate.

[–] 3 pts

Not really. Taxes are calculated based on property values and a multiplier which can change on an annual basis. When property values go down they just change the multiplier

[–] 1 pt

And those properties values are over inflated by mortgage loans, not capital or cash purchases. In other words, remove cheap loans available to anyone with a heart beat, and real price discovery is significantly lower as is the resulting tax. It's a racket. Fiat currency is slavery.

[–] 2 pts

Technicality - no, the tax "rate" doesn't goes down, unless the town/county/state lowers the tax rate.

But what I think you are saying is true - when the value of your home goes down, the taxes that you pay on it also goes down.