Will this news allow our Maryland property taxes go down? I do not think so, this state was quick to take when prices increased but now in decline they do not reduce so fast.

So "non distressed" sale prices are down about 2.5%... if we include distressed sales, I wonder what the real impact is?

Moreover, if you include all these delusional sellers who are refusing to do price reductions, I wonder what the impact would be. They can't refuse to sell indefinitely. A lot of these people are old, can't take care of their house anymore, and need to sell so they can move to assisted living/retirement home. If they don't eventually reduce the price, they're going to die in the house.

Long story short--prices are not at the bottom yet. Lots of sales are still holding out, lots of foreclosures have been stalled.

Jamie,

I have a question whcih you may be able to answer. During the boom with properties selling for higher and higher prices, property taxes on houses in Baltimore soared as taxes were based on the purchasing price of the house.

Now that prices are declining, dramatically in many cases, what happens to the property tax on a house?

To take as a random example, a Roland Park house that is now advertized at $350,000, which is a steal for a single family house in the neighborhood. However it had previously been bought some years ago for $450,000 and its property taxes are $12,000 a year based on that purchase price. But the house now has a much lower market value, so if you were to buy it at its asking price would your taxes still remain at $12,000 or will it decrease?

If the taxes don't decrease it may be why so many houses are sitting on the market for so long - they are trapped in the position where the taxes are too high for the current market prices.

Hi, chappy10 -- the 4.5 percent drop for the Baltimore area includes distressed sales.

Tom, part of what's going on is that the state reassesses each property once every three years. So assessments often lag. For a time, they were well below what people were paying. Then the market turned, and assessments were above the true value. (The state's been decreasing assessments, but prices continue to drop.) Property owners can appeal their assessments every year if they wish, so that's one way to deal with the lag problem. (New buyers who purchase in the first half of the year can speed up the process if they appeal within 60 days.)

Tom, I thought it was Ehrlich who raised everyones property taxes? At least that is what O'Malley's campaign ad says. That greedy lobbyist made everyone pay higher property taxes. He single handedly jacked up everyones home value. It's all his fault.