According to some economists, there are other factors that
discourage people from moving in to or staying in a state other than
the number of residential and commercial foreclosures. They stated that in some cases, tax rates are even bigger concerns than the depressed condition of housing.
Trenton foreclosure homes
and distressed property numbers in the rest of New Jersey were not the
main reason for the lack of growth in the state’s population. According
to economists, the high income taxes of the area have been cited as the
main reason by people who have moved out of the state. The population
of the region increased by 4.5% to reach over 8.7 million during the
Along with the high number of New Jersey foreclosed homes for sale,
the state is also facing potential loss of political power due to a
slow growth in population. Majority of the local areas of New Jersey
showed very little growth during the decade. New Jersey shares this
problem with other states in the northeastern part of the U.S.
Some economists have argued that the impact of residential and
commercial foreclosures on a state’s growth takes second place compared
with the effect of income tax levels. According to them, job creation
is necessary for economic growth and this can be achieved by getting
more businesses to relocate or expand in a particular area. This,
economists further added, cannot be achieved by raising taxes, but by
creating a stable business environment.
Those who believe that income tax rates hold the key to a state’s
economic recovery further added that lowering tax rates will attract
more businesses, create more jobs and, in turn, will lower the number
of foreclosure homes. They argued that, to improve the various economic sectors, officials will have to start at improving tax conditions.
The more businesses there are, the more people will move in and the
more potential buyers for residential and commercial foreclosures,
economists further argued. Although not all economists give the same
importance to the role that tax rate plays in economic development,
majority of them agree that it is a factor often considered by
businesses in choosing locations.