​

Financial Samurai

Slicing Through Money's Mysteries

  • About
  • Invest In Real Estate
  • Top Financial Products
    • Free Wealth Management
    • Negotiate A Severance
  • Buy This, Not That (Bestseller)

How To Lower Your Property Taxes – Adventures In Assessor Land

Updated: 07/08/2021 by Financial Samurai 26 Comments

As a homeowner, your goal is to keep your operating expenses as low as possible. Property taxes is one of those expenses that never goes away, but can be managed. As someone who has successfully fought the property assessors office multiple times before, let me share how you can lower your property taxes as well.

The Government Always Wants Your Money

The goal of local governments is to get every single penny in tax revenue from you! When I got my property tax bill in 2009, I was astonished to see that the City is taxing my primary residence based off an assessed value 7% HIGHER than in Armageddon 2008!  In the biggest economic downturn ever, the San Francisco assessors office believes my property actually increased?!  What a sham!

Like clock work, assessed values increase 2-3% higher every year, regardless of the economic environment.  It’s as if the City is punishing me for succeeding to lower my assessed value last year by 3%. 

Too bad for the city, because they are messing with the WRONG person.  The tax collectors office counts on citizens to roll over and listen to their every whim, but not me, and certainly not you!

I want to share some tips on how you too can fight against the machine.

How To Reduce Your Property Taxes In 5 Steps

1) Google “<Your City’s Name> assessor’s office.” San Francisco’s site is here. It’s important you proactively find out what the city/county is assessing your property first before you get your bill.  You need as much time to prepare for battle.

2) Go to their contact page and call and e-mail them every single day until you get a response. I’m not kidding here. They are sloooooow. Make sure all your v-mails and e-mails are polite, but stern saying you disagree with your assessment with proof.

3) After they respond, you must specifically ask how they came up with their ridiculous assessment value. Ask them to provide comps.  Also, ask them what you need to do to make your case. There will undoubtedly be appeal forms to fill out.  Fill them out and make copies for yourself (important as they like to tell people they never got it 2 months later, hoping you’ll give up and be too late!)

4) Like any good negotiator, you must highlight the lowest comps and negotiate accordingly. Let’s say your house is worth $1 million bucks. Go in with horrific comparables that look like bomb shelters in terrible locations, such as a house next to a firehouse that may be worth $500,000.  Your comparables need to be similar in dimensions and as close to your home as possible. Set your anchor low. The more comps you can provide, the better.  The assessor doesn’t usually have time to verify the comps physically, and just uses online comparisons.

5) After sending in the appeal forms and providing comps to your assessor, make sure you courteously follow up every month until you get confirmation of receipt. After reaching out this February, I failed to follow up with more comps until July (big mistake). By then, the assessor had moved to valuing a different district, and another person was recommended to me.  Good thing the new person had the forms, and  decided to e-mail and call me back. Otherwise, I would have wasted a lot of time.  Therefore, don’t forget to back up all your data!

*** This is exactly what real estate lawyers do if you’ve ever got those “lower your property tax” letters in the mail. Don’t be lazy and just do it yourself.

Never Give Up On Fighting To Lower Your Property Taxes

Persistence pays off. These guys don’t have to do anything for you so it’s important you approach them in a polite, but stern manner.  The new assessor could have said it’s too late since I got my bill already, but he worked with me given my unwavering commitment to fight. 

After several months of going back and forth, they lowered my assessed value back down to last year’s value, thereby saving me $1,504 ($94,000 X 1.16%).

Use any downturn (like a pandemic) to your advantage. Fight like hell to lower your property taxes. If you’re not selling anyways, who cares if you convince the city to believe your property is worth 30 cents on the dollar? You should be rejoicing instead!  Don’t roll over and accept what the city bills you. Take action now!

Shop Around For A Mortgage

Check the latest mortgage rates online through Credible. Credible has one of the largest networks of lenders that compete for your business. You can get free, no-obligation quotes in minutes. The more lenders compete for your business, the lower your rate. Mortgage rates continue to be near all-time lows.

Take advantage of the 15-year mortgage in particular. It’s an abnormality that it is average below a 5/1 ARM, which I usually like the best.

Latest mortgage rates

Invest In Real Estate Wisely

If you’re looking to buy property as an investment or reinvest your house sale proceeds, take a look at Fundrise, one of the largest real estate crowdfunding platforms today. They allow everyone to invest in mid-market commercial real estate deals across the country that were once only available to institutions or super high net worth individuals.

They are the pioneers of eREIT funds and they are creating an Opportunity Fund to take advantage of tax-efficient Opportunity Zones. Thanks to technology, it’s now much easier to take advantage of lower valuation, higher net rental yield properties across America.

Fundrise Due Diligence Funnel
Less than 5% of the real estate deals shown gets through the Fundrise funnel

Immediate Proof Why Net Worth Is Rubbish: Zillow Estimates

Updated: 03/11/2021 by Financial Samurai 15 Comments

Primary Residence Zestimate
Primary Residence Zestimate

Your net worth is rubbish due to poor real estate estimate, your net worth might be very off.

After all these years, Zillow still can’t get its property estimates right. Zillow is also a great reason why you’ve got to be careful calculating your net worth if you have property.

To prove my point regarding “Your Net Worth Is An Illusion” I took a look at Zillow’s latest zestimates of my primary residence and rental property. Apparently, in a span of 3 months, my primary residence gained a whopping $300,000!

I’m popping open a bottle of  Crystal, buying a rose gold Patek Philippe Calatrava at Tiffany’s, and ordering the Audi R8 on as we speak. Just kidding, especially since September is frugality month. Besides, Zillow isn’t writing me a check for $300,000!

The dollar sign shows the purchase price after a 4 month escrow that began in late 2004.  In other words, the purchase price was $250,000 below what the zestimate measured as fair value in the middle of winter.  

You’d think that after 10+ years of existence, Zillow’s price algorithms would be more refined. Perhaps the data is legit, but I’m not buying it. Since net worth calculations don’t include one’s primary residence, let’s strike this example and look at a rental property.



Read More…

Family Gets Award For Paying Off Debt & Jumps Right Back In!

Updated: 07/07/2020 by Financial Samurai 6 Comments

Paying off debt should be straight forward. Yet so many people fail to pay off their debts? If you go $106,000 into personal debt, and pay it off in 5 years, you apparently get the Professional Achievement and Counseling Excellence (PACE) 2009 Graduate Client of the Year Award. I was hoping for a longer award name, but what a great nugget to put on their resume!

The kicker? The Hildebrandt’s decided to dive back into debt with one year left on their pay back plan by buying a house! Furthermore, they took advantage of the $8,000 first-time home buyer tax credit. The article ends with sage advice from the Hildebrandt’s saying, “Get out of debt, it’s a choke-hold.”

We should be paying off debt

One of the greatest things about America is free speech. It’s never been paying off debt! Good or bad, we are a society that coddles fragile self-esteem and rewards people for situations they shouldn’t be in from the onset.

Although The Hildebrandt’s aren’t practicing what they preach, they’ve got their award and are living the American dream. Congrats guys! We can’t wait for your next award.

Meet The Hildebrandt’s and read about their great achievement.

Related Posts:

FS-DAIR: The Debt Pay Off And Investing Framework

Improve Your Wealth And Pay Off Debt

To better manage your wealth, you need a plan to pay off debt and save. First, check out these top financial products. Next, try using Personal Capital’s free financial tools. Personal Capital helps you track your net worth, control your cash flow, and growth your wealth on stealth mode for free.

One of their best features is their Portfolio Fee Analyzer, which runs your investment portfolio(s) through its software in a click of a button to see what you are paying. I found out I was paying $1,700 a year in portfolio fees I had no idea I was hemorrhaging!

Their second amazing tool is their Retirement Wealth Planner which is the best on the web because it pulls in real data you’ve linked up, and runs thousands of algorithms through a Monte Carlo simulation to give you a financial picture of your future. You can run multiple different scenarios with different spending, income, and life events to help anticipate your future.

Why I Didn’t Like Wells Fargo, But Now I’ve Reconsidered

Updated: 07/08/2021 by Financial Samurai 6 Comments

During the Global Financial Crisis in 2009, A Wells Fargo Senior VP, Cheronda Guyton moved into a foreclosed $12 million mansion with her family and hosted extravagant house parties. Meanwhile, her job is to figure out how to profit from foreclosures. But she didn’t allow brokers to show the Wells Fargo-owned place because her family was squatting!

Something Has Always Been Up With Wells Fargo

I knew there was something funny a couple years ago, when I was talking to one of their mortgage brokers and the rates he was quoting were 50-100bps higher than everyone else. Bank of America got my business instead. Too bad Ken Lewis was so empire-building driven and panic bought Merrill at the market open, instead of after the close.  What’s $25 billion more between between shareholders?

Given we live in bizarro world, don’t be surprised if Wells Fargo goes ahead and promotes her to lead up a different department.  After all, Wells Fargo does technically own the foreclosed home, and can do what they will.  Their $60,000/month vacation rental asking price might sound excessive, but not as excessive as Cheronda Guyton not letting anybody rent it out because she wanted to pump up the base herself!

Great to see our $25 billion in tax payer bailout money be put to good use.  Thanks for everything Cheronda.  Tell you what guys, since we are PR experts here at Financial Samurai, why don’t you Cheronda donate the $240,000 in lost rental income to the LA firefighter’s fund, and ask your employer to match it.  Here’s your article with further details.

A Lot Has Changed With Wells Fargo

Since 2009, Wells Fargo was found out to overcharge its retail consumers and open up new accounts unbeknownst to its consumers. Wells Fargo fired its CEO and other C-level executives. Further, it paid huge fines.

Post-pandemic, Wells Fargo seems to be on the up and up. Therefore, I’m OK with doing business with Wells Fargo again.

Invest In Real Estate Wisely

If you’re looking to buy property as an investment or reinvest your house sale proceeds, take a look at Fundrise, one of the largest real estate crowdfunding platforms today. They allow everyone to invest in mid-market commercial real estate deals across the country that were once only available to institutions or super high net worth individuals.

Fundrise is the pioneer of eREIT funds to enable retail investors to invest in stable, diversified real estate funds. Thanks to technology, it’s now much easier to take advantage of lower valuation, higher net rental yield properties across America.

Fundrise Due Diligence Funnel
Less than 5% of the real estate deals shown gets through the Fundrise funnel

Shop Around For A Mortgage

Check the latest mortgage rates online through Credible. Credible has one of the largest networks of lenders that compete for your business. You can get free, no-obligation quotes in minutes. The more lenders compete for your business, the lower your rate. Mortgage rates continue to be near all-time lows. Take advantage. 

Latest mortgage rates

Property Makes People Think Irrationally: Why Can’t People Think Right?

Updated: 07/08/2021 by Financial Samurai 18 Comments

Property makes people think irrationally and crazy. For those of you trying to buy property in this hot market, please don’t be the winning bidder out of 20! No, the housing market is not in a bubble due to strong fundamentals. However, you also want to buy responsibly.

Over at a new found site called ” The Writer’s Coin,” the 28 year old personal finance writer questions whether he should buy this house if he only has 13% down. Mind you, he has been giving personal finance advice for a couple years now. He is even a guest poster on mega-site Wisebread, which Financial Samurai may one day contribute to.

Honestly, I felt like I was watching one of those Holiday Inn commercials reading his post. A guy would provide some great advice and become a medical doctor because of his one night stay at the hotel chain. But what about the next night when he has to sleep at home?

WC’s question got me thinking. If someone who has been disciplined enough to write about money matters still can’t see the fallacy of buying a house with only 13% down, why are we so weak when it comes to housing? Do people just blindly fall in love with something and disregard every financial principal?  Doesn’t seem like WC has much more saved up than 13%, because who says “13% down” anyway? Why not 10%, 15%, or 20%?  Heck, back in the good old old days, people paid 100% down.

How did we come to this pitifully low downpayment standard in America? Probable explanation #1) It’s the Madoff Syndrome aka greed! “I want this, and I want it now!” and #2) The Nesting Syndrome.  There is a tendency for those in a long term relationship who want children to buy a place. I don’t even have to read WC’s about page to guess he’s planning on getting married or having kids. For the guy specifically, the itch seems to start at 30, if not sooner. The desire of owning our own castle and showing we’ve “arrived” is strong. 



Read More…

BusinessWeek: 10 Best Places To Own Property

Updated: 03/09/2021 by Financial Samurai 6 Comments

BusinessWeek comes out with a Top 10 list of best places to buy vs. rent. This is their formulation in their words:

“To create a fair match-up between owning and renting, we calculated ownership costs assuming a fixed 30-year loan for 100% of the purchase price with no down payment. If they had instead decided to factor in a 20% down payment, owning would have been the cheaper option for the top 10 metros on our list.”

BusinessWeek Best Places To Buy Problem

The problem I have with this list is that I don’t see the words “Honolulu”, “Newport Beach,” “Malibu”, “San Francisco”, or “Paradise”! Everywhere one wants to live is expensive, and everywhere one doesn’t really prefer to live is cheap. Things are cheap for a reason, and real estate is no different.

Think about prime real estate sitting a top a triangle. The triangle’s base always gets wider as demand continues to grow.  Meanwhile there’s only one prime location.  Is it no wonder why Realtors always talk about “location, location, location”?  You can also think of your sub-prime location as an inverted triangle ready to topple over.  Only a very few want to buy, and the supply is overwhelming.

During this real estate correction, you’ve seen expensive areas such as San Francisco correct 15-20% from the peak, however, drive out 1 hour east and places such as Antioch and Pittsburgh have gotten crushed by 40-60%.  

If you’re an investor, focus on places where you’d actually see yourself willing to live in. After all, if you wouldn’t want to live in your property, why would someone else?

A similar purchasing analogy can be made with cars. You may think that someone buying a limited production Lamborghini Gallardo Spyder for $210,000 is foolish with his money.

But, after one year later, he’ll sell that Lambo for more, or at the least recoup more than if he had bought a brand new Ford Expedition for $48,000.  Obviously this example is extreme here, given most don’t have $200K to splurge on a car, but you get my point.

Things are cheap for a reason. Only if you have the financial means, and are already living in one of these 10 cities should you consider buying.  Otherwise, just focus on buying or renting in that tropical paradise in the best location possible.

Read more to see what paradise cities lie in BusinessWeek’s Top 10 list!



Read More…

  • « Previous Page
  • 1
  • …
  • 28
  • 29
  • 30

Top Product Reviews

  • Fundrise review (real estate investing)
  • Policygenius review (life insurance)
  • NewRetirement review (retirement planning)
  • Personal Capital review (free financial tools and wealth manager)
  • How To Engineer Your Layoff (severance negotiation book)

Financial Samurai Featured In

Categories

  • Automobiles
  • Big Government
  • Budgeting & Savings
  • Career & Employment
  • Credit Cards
  • Credit Score
  • Debt
  • Education
  • Entrepreneurship
  • Family Finances
  • Gig Economy
  • Health & Fitness
  • Insurance
  • Investments
  • Mortgages
  • Most Popular
  • Motivation
  • Podcast
  • Product Reviews
  • Real Estate
  • Relationships
  • Retirement
  • San Francisco
  • Taxes
  • Travel
Buy this not that WSJ bestseller 728
  • Email
  • Facebook
  • RSS
  • Twitter
Copyright © 2009–2022 Financial Samurai · Read our disclosures

PRIVACY: We will never disclose or sell your email address or any of your data from this site. We do highly welcome posts and community interaction, and registering is simply part of the posting system.
DISCLAIMER: Financial Samurai exists to thought provoke and learn from the community. Your decisions are yours alone and we are in no way responsible for your actions. Stay on the righteous path and think long and hard before making any financial transaction! Disclosures