When I began writing about all things real estate, I mentioned that there are ripple effects.  Home and property values can have far reaching effects and clearly the next ripple is about to become a big tidal wave... Property Tax Appraisal Growth.

I was reading the newspaper a week or two ago and a made a few mental notes that I wanted to write about here.  The news story was about how the slowdown in real estate price appreciation is this year affecting the growth of property tax revenues at a time when the cost for delivery of existing services is rising and there is public demand for increased services.

This year's growth rate (largely due to commercial property increases) is expected to be a mere 5% once objection challenges to the proposed property values are completed.  This is of high concern in states like Texas where there is no state or local income taxes.  This leaves property taxes as the primary source for revenue to provide services... when property tax growth does not allow adequate growth to support the services necessary there are 2 options... service/program reductions or raising the property tax rates to a level that will fund services.

This development comes at a horrible time.  With costs rising for such basic services as gasoline to fuel police cars, fire trucks, school buses and trash collection vehicles, more money will be needed for these basic level budget items, making expansion of services and funding for new programs seemingly unlikely.  Then add in electricity costs, maintenance of facilities, etc. and you can see where the need for greater tax revenues to merely maintain what we already receive (which by many people is considered inadequate) will be requirement in order to avoid service and program reductions.

I gearing up for a tax rate increase... hold on tight and sound the warning sirens!  I doubt this will be the last ripple that becomes a potential tidal wave!