Bruce has provided good information below.
I go to settlement on a house at 1302 South 7th St next week. My client, the Seller, applied for a 10 year tax abatement prior to re-construction. The new buyer will have an annaul tax bill of only $888. They will not be re-assessed for improvements for 10 years. It may go up slightly as Philadelphia raises taxes occasionally but this property's assessment will not increase for 10 years.
Please feel free to contact me to discuss your plans. I'd be happy to help you through the process.
All the best,
Larry Lichtman, CNE
REALTOR, Property Manager
Your Real Estate Resource For Life
Cell/Text: (267) 254-7994
Real Estate Sales & Leasing
Property Management & Insurance
1611 Snyder Avenue
Philadelphia, PA 19145
Office: (215) 271-7070
People like you ask this quesion becuase in the suburbs and NJ taxes are so much higher on new construction. To encourage peple to move to the city and to encourage new development, the city of philadelphia passed ordinances now approx 8 years old which has resulted in great new housing in center city and benefits landlords and new owners with LOW LOW LOW taxes for 10 years. I just built five 800k townhomes...the taxes are approx 900/year for 10 years. this isn't a gimick. please be sure to get with people who know the new construction business as YOU MUST file all the paperwork in a timely manner to qualify.
Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
1. Do you mean will real estate taxes skyrocket for the neighborhood if you buy land and build your own home on it?
2. Do you mean that real estate taxes will go up just for you?
And, of course, if you build a house on undeveloped land, the land will now be improved and the real estate taxes will be assessed on the value of the house. The taxes are just a small portion of the total taxes once the land has been improved. The tax assessor will base his/her assessment on comparable market values of other homes in the neighborhood that have recently sold. If there are no valid "comps" or other properties to compare it to because the house would be new construction and maybe all the other homes are older, the assessor will do his/her best to make an accurate assessment. If you know what the building costs would be to build this house, you should consult with the tax assessor in your area to get a handle on projecting what the taxes would be.
Be careful that you don't spend more on building the house than on what other homes in the area sold for recently. If that happens, and you decide to sell, you may have alot of difficulty recovering the value of what you paid to build the house.
Anna Maria Vona
William Festa Realty