"People Are GOING TO LOSE THEIR PROPERTY OVER THIS.."

If things keep going like they have been when it comes to real estate, we're going to see a situation where a lot of homeowners are going to lose their properties. And this is going to be due to the insane increases in property taxes that people are seeing across the country. Like here in Florida, we are known for having higher property taxes, especially since we have no state income tax, but that is not a surprise. When you buy a property here, you're going to see that your property taxes are going to be high, and they will go up even further from there. But it won't be as much of a shocker as like what happened to this woman in Illinois. This woman in Illinois, she owns a 96 acre lot in Montgomery County. And her previous property tax bill was $756 for the entire year, which I have to say is extremely low, especially for a piece of land that large. And especially in a state like Illinois, because Illinois is actually an even higher property tax state than Florida. But what happened to her is something that nobody could have ever anticipated or expected. Her property tax bill went up more than $10,000 the following year, which ended up being a 1,222% increase, guys. That is absurd. How in the world can this be legal? How can any county or local government levy a tax like that on somebody overnight? I mean, that is just a criminal amount of an increase. Nobody should be seeing an increase like that ever for anything. And the thing is, she's not alone. Stories like this are continuing to pop up from all over the place, not just in states like Illinois or Florida. In fact, I ran a story a month or two ago talking about how something like this happened to a lot of people in Pennsylvania. People didn't see their property taxes go up for like a decade, and all of a sudden, the next year, it went up like 40% overnight. That's an unaffordable increase for a lot of different people. And when you see these sudden increases like that, it's enough to put people into foreclosure, guys. But how this ended up happening to her is that there is a state law in Illinois, going back to 2007, that requires woodland tracts to be taxed like homes. And that's according to the Montgomery County Assessor. And up until this year, the law wasn't correctly implemented in Montgomery County. So as a result, woodland properties are now taxed at 33.33% of their market value. Well, how convenient that they haven't been enforcing the law since 2007, and now all of a sudden, they decide, yeah, well, we're going to start enforcing this law, and everybody's just going to have to pay up. I mean, what's next from there? Did they retroactively charge you for all the years that you should have been paying a higher amount because of their own mistake? And get this, this is also a problem with local governments in general too. Property owners can challenge the assessment through the Board of Review, though a resolution may be difficult due to the lack of township assessors. So yeah, you can try to challenge it if you want, but chances are no one's going to see your challenge or hear your cries because no one's working here anymore, is kind of what I get from that. I think what you're going to see is a lot more people starting to list their properties for sale that end up in surprise circumstances like this because most people aren't going to be able to afford it, guys. And rather than lose the home or lose the property, they're going to try to sell it first. So once we really start seeing a large uptick in inventory, which we already really have, inventory across the United States is already at pre-pandemic levels in terms of the amount of homes for sale, but I'm going to be looking for that number to outpace the number of homes that were for sale because clearly this is something that a lot of people aren't going to be able to keep up with. And the worst part is when something like this happens, it's completely outside of your control. There's nothing that you can do besides try to contest the bill and hope that you win. But once again, if no one is there to hear your cries or to review your dispute, then it doesn't really matter. So it's reasonable to say that a situation like this is completely outside of your control. But one thing you don't want to lose control over is your data. One thing that many of us have lost control over is how our personal data is being used, shared, distributed, and even sold online. 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Now, one thing I've been hearing a lot lately is mortgage rates are falling and people are starting to refinance and the market's coming back. As soon as mortgage rates fall, just tenths of a percentage point, everybody on the other side of this just keeps saying that everything is back to normal. And the market's robust again. Well, to give you guys an idea, just a little while ago, like a month or so ago, mortgage rates were around 7% and now they're at 6.79%. That is not a huge decrease in rates and it really isn't going to save you that much money. But what you hear is that, oh, look, there's so many people who are deciding to refinance now because the mortgage rates went down, you know, 20 basis points. In my opinion, the only people who are even going to be close to the point of being able to refinance in this environment, like say mortgage rates are at 6.8% now, is somebody who got a mortgage rate of 7.5% or 8% when mortgage rates were, you know, at their peak. Then maybe that might justify a refinance right now. Maybe. It also depends on how much value your property has lost or gained in the meantime. And it also depends on if you're even able to refinance due to your income situation. Has it changed? Have you taken on more debt since you bought the home? Those are all things that are going to be taken into account of if you even qualify for a refinance or not. Now, according to Redfin, about 17.2% of homeowners in the US have a mortgage rate of about 6% or more. And even though that is basically the highest level on record, that's not a huge percentage of homeowners out there that are going to be looking to refinance because that's still a very small segment of the market. So when you hear headlines like this that, oh, mortgage rates inched down and refinance applications went through the roof, take those headlines with a grain of salt, guys, because the reality is we still have about 83% of mortgage holders with an interest rate of less than 6% right now. And 21% even have a rate of less than 3%. Now, that doesn't mean somebody in their position still won't refinance because what a lot of people are doing and have been doing is doing cash out refinances. In case you don't know what that is, that's when you refinance your home because it went up in value and you basically take the difference off the table. So let's say you owe $200,000 on your house, right? And you're able to refinance it. And even though you're trading up for a higher mortgage interest rate, you're pulling some profits off the table. And after the closing's done, everything is said and done and you refinance, then maybe that $200,000 mortgage gets paid off and you walk away with an additional $70,000 in your pocket because the value of the home has gone up, right? But now the situation is that you have a higher mortgage rate than before, which means you have a higher payment than before based on also a higher borrowed amount. Now, the most common reason that a lot of people will do this is to pay off other forms of debt, like credit cards, like car loans, like student loans, like personal loans, all other forms of debt. And this is a huge mistake that people make because they're like, wow, great, I got out of all this debt. Now all I have is this one payment that's higher, which is now my mortgage payment. I can manage this. Well, they think they can manage it, but the reality is if you're somebody that got into a situation where you have all this debt and you couldn't really pay and you used your house to pay for it, then it's probably just going to be a matter of time before you find yourself in that situation once again, because people who find themselves in those situations usually have a lack of financial education. They usually have a lack of self-control when it comes to being able to spend and budget accordingly. Another reason that people will do one of these cash out refinances is for home repairs or renovations, construction, different things like that. They say that the average homeowner right now has about $313,000 worth of equity in their home and of that amount, $203,000 of it could be borrowed against the home while maintaining a 20% equity cushion, which is what you need to have in order to be able to refinance. And to show you that this isn't just some made up number or something that I'm pretending that people are doing here, according to data from ICE, in the fourth quarter of 2024, cash out refinances went up 25% year over year, guys, which is a two year high, $21 billion worth of refinancing. So clearly a lot of people are doing this right now because of the reasons we just talked about. And going back to what we talk about all the time is why would anybody be doing this if they were doing well? Why would people be pulling all the equity out of their home to pay off the rest of their bills if they had all this money and everybody was just doing great and the economy was fantastic? Clearly they wouldn't be. This is a sign of distress, which is why I wanted to show you guys this. I came across this interesting map from Yahoo Finance that shows you, that pretty much compares the cost of living in every state. And you can see by looking at this map, areas of the country that are cheap and other areas that are expensive, and pretty much all of it doesn't come as any surprise, but I think it's a good tool for people to look at and use if you're somebody who is kind of in this situation. Like, yeah, you know, I'm doing okay, but I kind of need to use the equity in my home to get by. You know, I'm kind of sinking. The cost of living where I live is just too high. Maybe you want to take a look at this to see if there's somewhere else that might be interesting for you to move to. The highest cost of living states and areas of this country are California, Washington D.C., New Jersey, Hawaii, Washington State. Those are the top five. And if you're looking for the lowest cost of living areas, you can look into places like Arkansas, which is literally the cheapest state to live in, in the entire country. And I've been there before. It's not bad. I would even consider living there, especially if I needed to cut down on expenses. Mississippi, South Dakota, Oklahoma, Louisiana, all of those states are the top five lowest cost of living states in the country. That's always been my top advice to everybody who's been struggling, is look at other places that you can live and move to where life is going to be easier, guys. And a lot of people will argue, well, those places are cheap, but they're high in crime and there's not a lot of job opportunities. But if you dig deeper, you might find that that might not be the case. You know, these are all huge states and of course, you're going to have pockets in any state or even any city where that is the case. But if you do enough research, then you might be able to find a place that has a nice balance with a relatively low cost of living, not a lot of crime, and is a nice, safe place to live in. And most importantly, isn't going to break the bank every single time you need to buy something. Now, some news on the tariff situation. Walmart is arguably the biggest retailer in the United States, right? And Walmart right now is trying to push hard on China in order for a lot of their Chinese suppliers to absorb the costs of the U.S. tariffs. They're pretty much asking the Chinese manufacturers to absorb the entire blow, the full 10% that was just levied on China. So far, a lot of the suppliers supposedly are resisting this request. They say that any further price reductions would jeopardize their own profits. And so far, very few suppliers have agreed to Walmart's demands. Some of them are offering a little bit of wiggle room, like, yeah, we'll lower the price by 3%, but you're going to have to take on the rest. So this is exactly what I was talking about in my last video with the tariffs discussion, okay? Because even though these tariffs have been levied, we don't know how much of that final impact is going to come down to the consumer. Like say, for example, you have a lot of these suppliers at Walmart that say, we'll knock 3% off at Walmart, and Walmart says, we'll knock another 2% off, well, then the average American might only see a 5% increase in that product rather than a 10% increase. So until all these details get worked out and we see the final result and how much people are really paying, we're really not going to know. We're not going to know how much these tariffs are going to impact people at the consumer level just yet. What some manufacturers are also looking at doing is sourcing materials from other countries like Vietnam, for example. And really Walmart's best shot at being able to make this happen is the fact that they pretty much are the largest retailer and have a lot of bargaining power. And a lot of these suppliers don't want to lose Walmart as a customer. But if they're not making any money, then there's not really much to lose. So we're just going to have to wait and see who's really going to be eating these increased costs. I think it's going to be a combination of everybody is how it's looking right now. The consumer is going to eat some, the manufacturer is going to eat some, the retailer is going to eat some. And this is not really a good thing considering that February is already turning out to be a pretty bad month in terms of job openings because we just got the latest ADP report, which is the job report from the private sector. This is not the government jobs data. This is from the private payroll company, ADP. And what their data from February is now showing is that hiring has slowed significantly, which is something else that we anticipated in our tariff video. According to Wednesday's data from ADP, it showed that the private sector added 77,000 jobs in February, which is about half of what they were expecting at 140,000 guys. That is pretty bad. And just think about this. You know, when there's an expectation of the jobs to come in at 140,000, but they really come in at 77,000, what does that tell you about the economist's outlook of what's happening in the economy? It tells you that they believe that things are still a lot better than they actually are. Because when the data comes out debunking their thoughts and it shows you what people already really know and have been feeling, well, then it's like, hey, what's going on here? Maybe all these people who have been saying we're in a recession are right. And not only was the actual number far lower than the expected amount, but in January, the jobs number from ADP was 186,000 jobs added, guys. So this is a huge, huge decline in just one month. What's the reason for this? Well, policy uncertainty and slowdown in consumer spending has led to layoffs and a slowdown in hiring. That's according to the chief economist over at ADP. So people that are in high up powerful positions right now are starting to mirror and say the same things that I've been talking about here on the channel for the last couple of years. Because our data combined with other recent indicators suggests a hiring hesitancy among employers as they assess the economic climate ahead. And before this, we had other bad economic news, which was a slowdown in consumer spending, retail sales are off, manufacturing activity has been sinking, and construction spending has been going down, and housing activity is abysmal right now. Pretty much at 40-year lows now, not even at 30-year lows anymore in terms of the amount of homes being sold and transacted. So it's a mess. Really what we have to pay attention to moving forward is what people are spending money on or not spending money on to see how far this is going to go, guys. How far are we going to sink into this recession slash depression? And even with all this information coming out, you still have people that are bullish on the economy. You had one economist here say that even with this latest jobs report, I still think we're in a healthy labor market. It doesn't mean every part of the labor market is healthy. Some of it's flashing yellow lights a little stronger and longer than others. Oh, okay. The only parts of the economy, the only labor markets that seem to be healthy are the very low-paying ones, like the hospitality and the restaurant jobs, things like that. This economist even said, I don't think the economy is turning on a dime in a negative direction. Well, we'll see. It certainly looks like things are headed that way. I mean, what kind of information are we getting recently that is positive? What kind of information are we getting that's showing that things are turning around and going in a good direction? I mean, I haven't heard any lately. And pretty soon we're going to get the actual jobs numbers from the labor department, from the US government, and the expectation is supposed to be 160,000 jobs. So very likely, just like the ADP expectations were way off and far away from reality, most likely we're going to see the numbers from the labor department come in below expectations as well. But even if it didn't, guys, even if it blew away expectations, we already know from everything that we saw happen last year that these numbers can't be trusted anyways, because every single month except for one, I believe in 2024, was heavily revised down to the point where it's like we didn't even actually create any jobs last year. So regardless of what the actual number shows, it doesn't really matter. What matters is what your neighbors tell you. What matters is what your uncle tells you. It matters what your close relatives are telling you about what's happening with their family and their situation. That's the real economy. And that's what I like to report on here on the channel, the real things that people are facing and going through. So if you enjoyed this video, make sure you subscribe to the channel. And if you don't want to wait for my next video to come out, check out this one on the screen right over here, and I'll see you in the next one.