“China Property Stocks Decline on Possible Tax Trial (Update2)” plus 3 more

China Property Stocks Decline on Possible Tax Trial (Update2)
China Approves Property Tax Trial in 4 Cities, Observer Says
Gov. Christie Promises Property Tax Reform
Assessor tries to simplify stateâs complex property tax laws

China Property Stocks Decline on Possible Tax Trial (Update2)

Posted: 22 Apr 2010 02:49 AM PDT

By Bloomberg News

April 22 (Bloomberg) -- China's property stocks fell to the lowest in more than a year after the Economic Observer said the State Council has approved a real-estate tax trial in four cities and Citigroup Inc. forecast prices may drop 20 percent.

China Vanke Co., the biggest developer, slid 2.6 percent to close at 7.90 yuan, extending its decline this year to 27 percent. A gauge of property stocks in the Shanghai Composite Index retreated 1.8 percent to its lowest since April 8, 2009.

The trial will start in Beijing, Chongqing, and Shenzhen and then in Shanghai following the World Expo, the report said, citing an unidentified person. A "turning point" in the China property market is "unavoidable," Citigroup analysts Oscar Choi and Marco Sze wrote in a report today.

"Investors are worried about a worst-case scenario for property companies along with banks on the government's crackdown," said Wei Wei, an analyst at West China Securities Co. in Shanghai.

China has introduced "the most draconian" measures in the past week, according to Deutsche Bank AG's Greater China chief economist Jun Ma, after earlier steps including raising the amount of bank reserves failed to prevent a record surge in property prices in March. Hedge fund manager James Chanos said this month China is "on a treadmill to hell" and that the real estate is a bubble that may burst as early as this year.

Tax 'Inevitable'

The property bubble could hurt social as well as financial stability and must be deflated if the country is to urbanize and develop a healthy economy, the China Securities Journal said in an editorial today.

The implementation of a property tax is "inevitable," the only question is when and where, Michael Klibaner, head of research at Jones Lang LaSalle Inc., said in Shanghai today.

Citigroup analysts predicted home prices may fall as much as a fifth from current levels by the end of the year, as tightening measures and increased land supply take effect.

The southern city of Guangzhou had 804 cancellations for home purchases on April 19, the highest on record, China Business News reported today, citing the Guangzhou Municipal Land Resources and Housing Administrative Bureau.

The housing ministry vowed April 20 to punish developers that "artificially" create supply shortages and ordered builders not to take deposits for sales of uncompleted apartments without proper approval.

Loan Curbs

The central bank last week raised mortgage rates, increased down payments for home purchases and ordered banks to restrict loans for buyers of three or more homes. State-owned companies were ordered by the government in March to pull out of property development if it's not their main business.

Demand for housing in China will withstand government bank lending curbs, and further declines in the nation's property stocks may be an opportunity to buy the shares, Templeton Asset Management Ltd.'s Mark Mobius said this week.

Alpha Investment Partners Ltd., a unit of Singapore developer Keppel Land, is looking to invest in Chinese property as it bets on "real demand" to hold up, Managing Director Loh Chin Hua said in Singapore yesterday.

Shanghai New Huangpu Real Estate Co. slumped 4.7 percent to 13.11 yuan today, extending a loss this week to 21 percent. Greentown China Holdings, which develops villas, slid 2.4 percent to HK$8.47 in Hong Kong, a 12th day of declines.

--Chua Kong Ho in Shanghai. With assistance from Zhang Shidong and Luo Jun. Editors: Allen Wan, Richard Frost

To contact the Bloomberg News staff on this story: Chua Kong Ho in Shanghai at kchua6@bloomberg.net

Last Updated: April 22, 2010 05:27 EDT

Gov. Christie Promises Property Tax Reform

N.J. Gov. Said He Hopes To Stabilize Highest-In-The-Nation Property Taxes During First Term

BELLEVILLE, N.J. (CBS) ―

Click to enlarge: New Jersey Gov. Chris Christie.
CBS

Gov. Chris Christie hopes to stabilize New Jersey's highest-in-the-nation property taxes during his first term.

Appearing on New Jersey 101.5 (WKXW-FM) Wednesday night, Christie said spending reforms are needed to reign in property taxes averaging $7,300.

The new Republican governor wants to see a proposal on the November ballot to cap local spending and tax increases at 2.5 percent. If lawmakers agree to put the question to voters and it's approved, municipal and school budgets could exceed the cap only if voters approve the extra spending.

Christie says a hard cap will impose discipline on runaway spending. He's also seeking to reform negotiations between towns and union workers.

Christie campaigned on a promise of lowering taxes on businesses and residents - though not in his first year in office

Meanwhile, voters made it clear that they are sick and tired of paying taxes -- even at the expense of schools.

On Tuesday, 59 percent of districts rejected their proposed school budgets; 41 percent approved them.

It's a huge victory for Christie in his fight to reign in spending.

With the marching band supporting them, dozens of Teaneck students refused to walk into their classrooms, holding signs up high as they protested the defeat of their school budget. They said they worry the programs they love the most will now have to be cut.

"I wanted to make sure that everyone sees that we're serious about this. I mean, we're not going to let this happen," high school junior Gerard Rice said.

Across the Garden State the same concerns exist as students try to predict what they think could be eliminated in districts where budgets have been voted down.

"They'll make the (cuts) in drama clubs and sports and freshman football will all be cut," Nutley High sophomore Amber Reda said.

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Assessor tries to simplify stateâs complex property tax laws

Posted: 22 Apr 2010 11:32 AM PDT

BISBEE — "Arizona has one of the most complex property tax laws in the nation."

County tax assessor Phil Leinendecker set about explaining just how confusing property valuations are as well as how important it is for the county's properties to be appropriately valued. The state mandates that valuations be done annually and the county has been under an order to get caught up with property in the Sulphur Springs Valley, Willcox, Bowie and Pearce areas.

That's where the confusing part comes in, he told the Board of Supervisors in a recent work session. "When the real estate market is booming, there's not a problem. When it falls off, it takes a few years to catch up to the market decline."

Recently, county property owners received their valuation notices for the 2010 tax year. However, those valuations are based on market sales from 2008, said Leinendecker. This is also confusing to taxpayers. The valuation year is always behind the tax year. Market values and sales were not yet in a decline in 2008. In some areas of the county, real estate values have barely declined at all, as with Bisbee.

Sales activity dropped nearly 75 percent in 2009 and some rural vacant parcels lost 20 percent of value, added Leinendecker.

The 2011 tax year assessed valuation will be of market values of 2009.

In an overview of the duties of the state Department of Revenue and the assessor's office, he said the values of utilities, airlines, railroads, mines and other geographically dispersed properties (properties that encompass more than one county or state) are determined by the DOR. Those figures are transmitted to the county Board of Supervisors for entry on the county tax rolls for levy and collection of property taxes.

County assessors, utilizing appraisal standards and manuals prescribed by the DOR, are responsible for assessment of other classes of property, including residential, commercial, industrial and agricultural properties, he explained. His office must locate all taxable property in the county, assign a classification and then perform the valuations. These tasks are performed by searching deeds of transfer, mapping new subdivisions and following parcel sales and splits and checking new construction permits.

A big task is keeping up with changes in property ownership to be sure the tax bill goes to the right person, he added.

Staff from the assessor's office will also visit property where construction is taking place to take measurements of any new additions or outbuildings. "We can access the property to do this, but if we are asked to leave, we do. We then take estimates of measurements and use those figures for new valuations of properties."

To determine a property's value, residential, commercial, industrial and vacant land are assessed on fair market value. The special statutory valuation method is applied to agricultural land, shopping centers, golf courses and common areas.

In order for land to be granted ag ranch status, there must be at least 40 head of cattle on the property. In some areas of the county, the standard of one cow per 80 acres is required due to meet the dietary needs of the cattle. Value for farmed land is based on the income from the crops.

There are exemptions as well that must be considered in the valuation process, stated Leinendecker. For example, widows and widowers, those that are 100 percent disabled and certain organizations get a reduction of around $3,445. There is also a senior freeze which holds valuation rates on a primary residence for three years for those 65 years and older if they meet the income limit and residency requirement.

Appeals of valuations or classifications for locally assessed properties have to be filed by April 30. Forms are online at: www.azdor.gov/Forms/Property.aspx .

Just The Facts

More about how valuations are assessed can be found on the county Web site: http://cochise.az.gov/ and under the department tab, select assessor's office. The assessors can be reached at 432-8650.

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Property Tax

Thursday, April 22, 2010