There is a great deal of direct mail circulating these days about the potential for homeowners to win adjustments to their property tax liability, if they recruit the service of and attroney and relinquish a percentage of their savings to the attorneys.  Other than these mailings, and a few newspaper stories here and there, not much has actually happened to align falling home values with property taxes.

For the past year, local governments have been collecting funds that don't reconcile with the current home values on which they are based.  This means there are surplus tax dollars sitting in government accounts which are due to the homeowners.  Of course local governments are far from 'in the money,' however, municipal bankruptcy is far less painful than personal bankrupcy, foreclosure and intra-family stress.

This is an area ripe for reform in any consumer stimulus plan being considered in DC or Chicago.  The idea is this:

Institute a dynamic proprty tax appraisal system, one that adjusts every pay period to an objective value.  And secondarily, apply the over-payments of the past 2 pay periods as either a credit to the next pay periods or a mortgage credit.

Homownership is a fundamental American value.  Consumer confidence and behavior won't be restored until homeownership is once again a viable and accretive act for Americans.