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Dallas Pre Foreclosure Homes Adding to Tax Revenue Fall

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By : John Cutts    99 or more times read
Dallas pre foreclosure homes have been contributing to property tax revenue fall in the county, according to Dallas County officials.

Ryan Brown, director of the Dallas County Budget Office, said that the county is facing a budget deficit of $56.5 million this year due mainly to the expected drop in real estate tax revenue.

Since property taxes comprise about 50 percent of county revenues, about $31 million of the expected budget deficit can be ascribed to the expected drop in property values. Foreclosures in Dallas continue to drag down real estate values, particularly residential property values.

Brown said that property values in Dallas County are expected to fall by 8 to 9 percent this year, the biggest reduction in many years. In 2009, property values dropped by just above 3 percent, the biggest drop for the 1992 to 2009 period.

Commercial property values are also expected to fall by 5 to 10 percent, as vacancy rates have shot up and rents have fallen substantially. A lot of tenants have been threatening to leave if their leases are not renegotiated.

According to county officials, the operating budget for the fiscal year 2009-2010 totaled $445 million and the expected shortfall covers the current fiscal year and the next.

The lower prices of Dallas pre foreclosure homes have also put a downward pressure on property values within the city of Dallas, cutting down the anticipated property tax revenue by a substantial percentage. The city expected a budget shortfall much higher than that of the county an expected deficit of more than $100 million.

To help the city cope with the anticipated shortfall, the city manager has asked most city departments to cut their budgets by 30 percent.

According to Ken Nolan, appraisal chief for the Dallas Central Appraisal District, foreclosures are now spreading into affluent communities like University Park and Highland Park. People asking how to find foreclosure listings in Dallas can start looking in these communities if they are interested in high-end homes that are now priced much lower.

According to some county commissioners, raising property taxes is one way to close the gap in the budget, but an increase in tax rates will only worsen the situations of residents. They also expect a fierce opposition from the public, since resident are expected to question the wisdom of raising taxes at a time property values are being dragged down by Dallas pre foreclosure homes and foreclosed properties.

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