Nearly 40 percent of millennials will be looking to buy their first home in the next year. (Redfin, 5/16)
Real estate consultant helping, first time home buyers, sellers and investors for over 15 years in South Jersey, call us nowto help you find the best deals
Nearly 40 percent of millennials will be looking to buy their first home in the next year. (Redfin, 5/16)
Atlantic City, Cape May County caught in financial death spiral
Last November, Atlantic City government had to pay $34.6 million in tax refunds to several casinos that appealed their tax assessments. Instead of cutting spending or raising taxes to come up with that money, local officials borrowed $38.5 million and agreed to pay $4 million in interest.
Last week, Cape May County Chief Financial Officer Ed Grant said Cape May County is short money because of an “unprecedented” drop in Cape May County property values. But instead of drastic cuts in spending, county officials are proposing tax hikes.
But the real problem in both cases is taxation without representation.
Contact me for all your real estate needs: Jose Rivera Sinclair
Email: s[email protected]
When New Jersey voters approved casino gambling, most people thought real estate taxes would go down in Atlantic City, since casinos would be paying so much of them. But it didn’t work out that way, because state law banned virtually everyone in the casino industry from being involved in politics in any way.
Casino companies, unlike racetrack owners, cannot contribute to political campaigns. Most casino employees are barred from running as candidates. And because the politicians on the Casino Control Commission can yank the license of any casino and destroy a $2 billion investment like the Tropicana at any time, casino executives won’t even talk about New Jersey politics.
Casinos are heavily involved in Nevada politics. But did you ever hear any casino executive complain that it costs Atlantic City $216 million each year to run its local government for 40,000 residents? Did any New Jersey casino suggest cutting any of the $153 million Atlantic City spends on its public schools each year? For years, casino companies were even afraid to appeal their tax assessments.
Because most casinos rushed to open during the boom years, they grossly overpaid to assemble their land. And they paid too much for the “right” lawyers, consultants, contractors and unions with the right connections to quickly get their government permits and approvals.
As a result, most casino properties in Atlantic City were never worth anywhere near what it cost to build them.
But for 20 years Atlantic City’s assessor taxed them based on the inflated prices they paid to buy and build them. Meanwhile, everyone else in town was assessed at current fair market values.
The result was that casinos paid 60 percent to 80 percent of Atlantic City’s real estate taxes – two to three times what they should have been paying. This led to taxation without representation for the casinos, and representation without taxation for most voters.
Most voters in Atlantic City live in tax-free or tax-abated housing, qualify for senior citizen tax breaks, or have high-pay jobs or contracts with the local government or public schools.
But now casinos must deal with a bad economy and out-of-state competition. As casinos like Resorts, Trump Marina and Hilton sell for a fraction of their assessed value, they are proving in court that they are overtaxed and entitled to refunds.
To avoid disaster, Atlantic City officials must immediately shrink the size and salaries of local government to what they would be without casinos.
Otherwise Atlantic City will continue its death spiral. As more casinos fail (except for the Revel, which has tax abatements), the city will collect less in taxes. Without big spending cuts, the city must raise taxes even more, and force more of the surviving casinos and other businesses to fail. Which will cause even more tax hikes.
The same thing is going on in Cape May County. During the casino and real estate boom, lots of out-of-towners bought big vacation homes at grossly inflated prices. County and local governments then used taxes from those vacation homes to give big pay hikes, hire more people, and borrow more money to buy more things. Local politicians didn’t care since most of the new spending was paid for with taxes from people who didn’t vote.
But now Cape May County will also be in a death spiral, unless there are quick, drastic cuts in spending. As more out-of-towners unload their vacation homes, values go down. And if taxes keep going up, even more out-of-towners will sell, causing even lower property values and higher taxes next year.
Its chief financial officer said these drops in property values were “unprecedented;” that property values in Cape May County had “hit bottom” and are about to “turn around.”
But those of us who know that only liberty brings prosperity and that taxation without representation is tyranny know that this is only the beginning.
Tuesday, 24 January 2012 13:34
Recent changes in the tax appeal process have made procedures more complex. Most everybody believes that their real estate taxes are too high, especially in a bad economy.
However, it is essential that your clients understand they must prove their assessment is unreasonable compared to a market value standard. The current assessment is by law assumed to be correct. Property owners must overcome this presumption of correctness to result in an assessment change.
External factors such as inflation, appreciation and depreciation may cause values to increase or decrease at varying rates. Other factors such as physical deterioration may contribute to changes in property values. Obviously, if assessments are not adjusted annually, a deviation from 100% of true market value will occur.
The State Division of Taxation annually conducts a fiscal year sales survey, investigating all property transfers that occur in the community. Every sale is compared individually to every assessment, in order to determine an average level of assessment in a municipality. An average ratio is developed from a sampling of property sales to represent the assessment level in your community.
How do I know if my assessment is fair?
The New Jersey Legislation adopted a formula to test the fairness of an assessment. Once the Tax Board has determined the true market value of a property during an appeal, they are required to automatically compare the true market value to the assessment.
If the ratio of the assessment to the true value exceeds the average ratio by 15%, then the assessment is automatically reduced to the common level. However, if the assessment falls within this common level range, no adjustment will be made.
The taxpayer must be persuasive and present credible evidence. Credible evidence is supported by fact, not assumptions or beliefs. For example, if the property cannot be further developed for some reason, evidence must be provided.
The most credible evidence is recent comparable sales of other properties of a similar type in your neighborhood. Remember, if your clients are going to discuss comparable sales, not less than three comparable sales must be submitted to the Assessor, Clerk, and County Tax Board. Comparable means most of the characteristics of your client’s properties and the neighboring sales are similar. You should be knowledgeable of the conditions of the sales including financing and be able to give a full description of the properties.
If I recently bought my property, how is this purchase considered?
An assessment is an opinion of value. Uniformity of treatment dictates minor adjustments are not made simply due to a recent sales price. For various other reasons the subject's sales price may not necessarily be either conclusive evidence of the property's true market value, or binding upon the Tax Board. An examination of the circumstances surrounding a sale is always important.
A taxpayer filing an appeal should consider the following questions:
What was the market value of my property in the pretax year?
Can I support my conclusion of market value with credible evidence?
Is my property assessed in excess of its market value if a reassessment/revaluation was implemented in the current tax year?
If a reassessment/revaluation was not implemented, does my assessment exceed market value or does the ratio of my property assessment to its market value exceed the upper limit of the common level range?
For more information, and for a free review of your clients’ current real estate tax assessments, please contact Jose Rivera Sinclair at 609 646-3207
NEW JERSEY PROPERTY TAX APPEAL DEADLINES ARE APPROACHING QUICKLY.
Real estate tax appeals in New Jersey must be filed each year before April 1 of the tax year or within 45 days of the mailing by the municipality of the assessment notice; whichever is later.
The time to file may be extended to May 1 when the municipality has a revaluation of its entire assessment. Added and omitted assessments may be filed by December 1 of the tax year.
New Jersey residents pay the highest property taxes in the nation.
For more info call:
Jose Rivera Sinclair
Nearly Half of New Jersey Residential Homeowners Should Appeal Their Property Tax Assessments, According to Analysis
As many as 47 percent of New Jersey homes are over-assessed beyond the state's 15 percent buffer. Click here to read the entire PR Newswire article.
N.J. Commercial Property Owners Filing In Record Numbers
In 2007, the Shanahan brothers who own Washington Garage, a small auto repair shop on Main Street in Bergenfield, paid $22,107 in property taxes. Click here to read the entire northjersey.com article.
Northfield, NJ Just your luck — you have to sell your home in winter, the slowest and dreariest sales season of all.
Jose Rivera Sinclair
Balsley Losco Real Estate
Free consultation call 609 338 8877
But cheer up. You can use staging, the reduced competition and some seasonal opportunities to your advantage.
"You wouldn't necessarily choose to sell your home in winter," says Katie Severance, a broker for ReMax in Upper Montclair, N.J. "But there are certain extra steps you can take to really help your chances."
Many homeowners pull their houses off the market by year's end if they haven't sold. That's understandable. The period from Thanksgiving through New Year's Day is the slowest time of year for home shopping as people focus on family and holidays.
The weather, too, helps put the chill in sales in most locations between now and spring. January and February see the fewest home sale closings, according to the National Association of Realtors, with the market not fully gearing up until April and May. Another big factor: Homebuyers with children generally time their purchases so moving doesn't interfere with the school year.
Sometimes a job transfer, lease or personal circumstances require plunging into making a sale in the dead of winter. Although that means fewer buyers in most areas, as a seller you'll have a chance to stand out in a thinned-out field of competitors.
Here are some tips to lessen the chances your home will languish on the market:
1. Remember the basics.
Taking care of needed maintenance and repairs is obligatory in any season. A thorough cleaning and getting rid of clutter are equally essential. And tidying up the yard and touching up the exterior appearance to improve the curb appeal also can make the difference between deal or no deal.
In a slow market, nothing counts more than pricing aggressively. Check recent sale prices in your neighborhood on sites such as Zillow.com and Trulia.com and price your home competitively. "If it's priced properly, it will sell any day of the year," says Severance.
2. Think warm and cozy.
Home staging — techniques used to make your house look bigger, brighter, warmer and more appealing — takes on a new focus in winter. Rearranging the furniture and applying a fresh coat of paint to any room in need are just as important. But to convey a cozy impression in winter, it may behoove you to turn up the thermostat and have a fire in the fireplace for open houses. It will give you an edge over the many vacant homes on the market.
Staging may in fact be even more important in winter, according to Loren Keim, a real estate broker and professor of real estate at Lehigh University. "If you have a vacant house in winter with the heat turned down to 50, chances are someone will make a very low offer," he says. "And if you can leave at least a few pieces of furniture behind, it has more of an impact."
Displaying photos of how your property looks in summer is a good idea. Some staging experts also recommend decorating with warm colors such as deep orange or crimson.
3. Neatly shoveled paths make a difference.
It might seem obvious to keep sidewalks and driveways free and clear of ice and snow. But many homeowners who have already vacated their houses either aren't diligent about that winter duty or don't do a thorough job.
It's important for reasons of safety, aesthetics and, once again, competition. In particular, a foreclosed house probably won't have walks and parking spaces shoveled out, and "people don't like to deal with that," says Holden Lewis, real estate expert for Bankrate.com.
Lewis recalls pulling up in front of a house he had an appointment to see one February years ago in Toledo, Ohio. The sidewalk wasn't shoveled, and he took a look at the house from his car and decided not to go in. "If you want to sell the house, everything needs to be shoveled and clear," he says.
4. Good lighting is essential.
Your home may appear darker due to less daylight. Fight the gloom. Turn on all the lights possible for visitors — this is no time to worry about the electric bill. Open blinds, drapes and shutters to let natural light pour in. Make sure to clean any grime off the windows first.
Encourage showings during high-daylight hours. Showing after work in the dark isn't a great idea. Make sure you have enough outside illumination for drive-by visitors in the evening, however. And keep the place well-lit even when you're not there.
5. Tasteful holiday decorations can help.
The holidays give you an extra chance to make your home stand out. Keep decorations conservative and don't overdo it on outdoor lighting. You don't want to put 25,000 lights on the roof like Clark Griswold in National Lampoon's Christmas Vacation. As sure as he blacked out the neighborhood, you would scare off buyers. But a big red bow on the For Sale sign and some holiday greenery, twinkling lights and elegant decorations inside can help give buyers a dose of seasonal cheer.
When Christmas and Hanukkah are over, you can keep the spirit alive. A colorful winter wreath on the front door and colorful poinsettias and holly bushes in the yard will help retain a festive look for January and February, when more house-shoppers start to turn up.
Real estate is a people business, right? But who are those people—the ones who rent apartments and buy buildings, run companies and work there, operate retail stores and shop at them? Using the 2010 census data, let’s look at a snapshot of real estate users today and in the near future.
Do You Know Your Largest Segment of Buyers?
According to "DAILY REAL ESTATE NEWS" TUESDAY, NOVEMBER 29, 2011
Hispanic households account for more than half of the nation’s home owners, HousingWire reports.
During the third-quarter, a total of 545,000 new household units were formed—53 percent of which were Hispanic households and the remaining 47 percent making up other minority groups and whites.
From the second quarter to third quarter, the number of Hispanic households grew from 6.21 to 6.49 million alone, according to Census Bureau data.
315 S Main St
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