House of the Day: 544 Washington Avenue
The two-family house at 544 Washington was recently renovated and appears to be in move-in condition. The only catch is that they have to find a brownstone buyer who doesn’t give a hoot about original details and is happy with a Home Depot-esque kitchen. Another negative is that this block of Washington has a lot…
The two-family house at 544 Washington was recently renovated and appears to be in move-in condition. The only catch is that they have to find a brownstone buyer who doesn’t give a hoot about original details and is happy with a Home Depot-esque kitchen. Another negative is that this block of Washington has a lot of traffic on it. On the plus side, the taxes are quite low at $1,800. What do you make of the asking price of $1,375,000?
544 Washington Avenue [Corcoran] GMAP P*Shark
Class 1 properties (1-3 family owner occupied homes) are taxed based on 6% of market value. Other classes are taxed at 45% of their market value. Market values cannot increase by more than 6% per annum or 20% over a five year period. Houses are just plain taxed at a lower level than condos. It’s stupid – and I’m a homeowner.
See page 17 of the document linked below for more detail.
http://emma.msrb.org/EP332052-EP37100-EP659128.pdf
To be simplistic… Property taxes are assessed through a very complex formula. There’s a “tax rate” for different types of properties — and then this is applied to the property’s “value.”
It’s the value part that makes the tax liability so retarded. Basically, the baseline is when the Certificate of Occupancy was issued… or when property taxes started, whichever is earlier 🙂
Then there are caps on annual increases… so if the house was assessed in 1945, it doesn’t really matter how much the house is worth now (or not much at all). The taxes are bases on the 1945 value + the annual % increase.
Newer places and houses that were converted to condos/co-ops recently are paying HUGE taxes. Because instead of paying taxes on 1945 prices, you’re paying taxes on the 2004 prices (or whenever the C of O was issued).
But guess what! The taxes are attached to the PROPERTY, not the owner. So, if you sell your house based on 1945 prices for $24 million, the new owner “inherits” your old tax rate… so, there’s a good chance the new owner will pay a couple thousand dollars for a multi-million dollar mansion.
I have a stupid question.
How are property taxes assessed? I thought it’s based on home value and assessed annually.
(I’m not a homeowner, so bare with me.)
Denton, the issue is not “most New Yorkers” — the fact is that “most New Yorkers” (including renters paying their landlord’s taxes) are SUBSIDIZING thousands of property owners that are currently paying disgustingly low taxes. This property is a case in point, but there are many many many more. In fact, I wouldn’t be surprised if your house was a great example of this too!
There should not be a huge disparity between tax liability.
If you own a house and it has stayed in your immediate family… I can see tax increase caps. So, yeah, your taxes may be relatively low. HOWEVER, and this is a big however, if you sell the property for millions?! Why should the new own not be freshly assessed?! (And a predictable, appropriate tax liability applied to the property.)
If I buy a house for $3 million and the old lady that just kicked the bucket was paying $2000 a year — should this really be passed on to me?! That is just plain fucking stupid.
I don’t really care what “most New Yorkers” pay — I care that a certain number of property owners are effectively gaming the system and harming the City as a whole… including causing harm to “most New Yorkers.”
Actually denton, real estate taxes outside NYC tend to be higher. NYC has the wage tax, a high sales tax and a huge base of revenue from hotel & meals & services taxes.
But, rob is right. I paid more than 2X the taxes in My 750 sq ft manhattan condo than I do for my 2,560 sq ft bed Stuy brownstone. My taxes would be double to triple if my house was in CH, PS or BH.
I am not complaining
rob, most New Yorkers who own property pay some of the highest overall tax rates in the nation. Naturally, you wouldn’t know this.
well that is awesome news to my ears minard. it’s about time. you want to pretend your section of brooklyn is Beverly Hills East, then fine, you should start paying beverly hills style taxes. and while youre at it, introduce some of your children to a bar of soap.
*rob*
People who make a lot of money in NYC pay a lot of taxes. NYC is no tax haven for the rich.
Until relatively recently most wealthy New Yorkers lived in co-ops. People of modest means by and large owned the old, undesirable and un-fashionable houses in the Boros. “Brooklyn” was code for “working class”.
Real estate assessments have not kept pace with the incredibly speedy spike in house prices in the boros, but never fear, the adjustment is coming. People who buy these homes and expect their taxes to remain so low are dreaming.
DIBS is quite the exception.
*rob*