Ask me anything about Property Taxes

Atlanta, Georgia
Multi-Family and Apartment Investing
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Ask me anything about Property Taxes

Brad S.
Specialist · Hoschton, GA · Member since 2022 · 21 posts · 29 votes

Hey Guys, 

I am new to BP and am looking to get into investing at some point, but today I would like to help answer any questions y'all might have relating to property taxes in Atlanta, but also not limited to GA, FL, NC, SC, TX, VA. Property taxes are typically a property owners biggest expense and can also make or break a deal early on in the bidding process. If you are unsure of what the property taxes will look like post acquisition (year 1) and you are about to put in an LOI, make sure you run it by a property tax expert first, or you can just ask me since that is my area of expertise. GA typically get reassessed the year after sale which will result in the property taxes going up significantly. Of course, there are effective appeal strategies In Georgia that can help with mitigating the tax liability increase due to a sale which would increase cash flow as a result. That being said, if you are looking at a deal in the southeast and are unsure of what the property taxes will look like year 1 and have questions, please feel free to reach out to me and I will do my best to respond and answer your questions in a timely manner. You can also ask me general questions about tax assessment processes in other states and appeal cycles since no state is one in the same. I am here to add value and want to network so fire away.

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Gerardo Waisbaum
Investor · Jacksonville, FL · Member since 2019 · 97 posts · 50 votes
4y

Hey Brad,

Thank you so much for your willingness to help.

Can you shed some light on the tax adjustment process in SC? I'm bidding on an interesting deal in Greenwood county.

Thank you!

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  • Brad S.
    OP
    Specialist · Hoschton, GA · Member since 2022 · 21 posts · 29 votes
    4y

    @Will Gaston Hi will! That’s a great question, and yes, it is available in all counties as long as it is filed by the deadline and meets the criteria because not every property will receive the full exemption. 

    1Reply
  • Brad S.
    OP
    Specialist · Hoschton, GA · Member since 2022 · 21 posts · 29 votes
    4y

    @Ajay Mehta Thanks for the question Ajay. It would be based on the % complete as of the assessment date, January 1st of each year. With the exception of low income housing, the appraisal districts would use a cost approach for anything under construction. 

    0Reply
  • Ajay Mehta
    Member since 2021 · 10 posts · 0 votes
    4y
    Quote from @Brad S.:

    @Ajay Mehta Thanks for the question Ajay. It would be based on the % complete as of the assessment date, January 1st of each year. With the exception of low income housing, the appraisal districts would use a cost approach for anything under construction. 


     Thank you!

    Its 100% complete and closed just before January 1st. I am trying to figure out if the assessed value is based on purchase price, comparable price or by some other basis.
    0Reply
  • Alex Jansen
    Investor · West Palm Beach, FL · Member since 2013 · 5 posts · 0 votes
    4y

    @Brad Schewe, thanks for starting this conversation. How effective is purchase price allocation in mitigating some of the reassessment in locations where counties reassess on sale? What’s the highest % you’ve seen allocated to intangibles?

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  • Brad S.
    OP
    Specialist · Hoschton, GA · Member since 2022 · 21 posts · 29 votes
    4y

    @Ajay Mehta that’s a great question. TX is non-disclosure so I am never going to say they will base it on just the purchase price year 1. However, if the property is marketed after the sale (news letter, Costar, etc) they have the resources to find sales and will reassess based on a % of purchase. We are estimating 80-85% of purchase in year 1. If you want to shoot me the details and a private message I would be happy to take a look at the property for you. Let me know. 

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  • Brad S.
    OP
    Specialist · Hoschton, GA · Member since 2022 · 21 posts · 29 votes
    4y

    @Alex Jansen I totally missed your inquiry. To be honest with you that is not my area of expertise but to answer your question I haven’t seen any cases where that has worked in any state. I know of only one group out of FL that is doing this and there are some acquisitions out there that have gone this route that we will have a better idea on if it works or not after this year. I am currently tracking properties that I know of that will be going this route to see if it actually works because as or right now it’s still fairly new and there isn’t enough data available to say it works. I have a couple of clients that are doing this in GA and one of the counties that they are trying to do this in will put up a fight. There are plenty of appraisers out there that will fight this tooth and nail so whoever goes this route should be prepared to put up a good fight because not only is this taking money from the local municipalities it’s also impacting state revenue which I imagine will open another can of warms. I am not advocating against it by any means, I am just trying to think like an appraiser would if this were to come across my desk. It’s such a new concept that any seasoned appraiser will pick the allocation apart so I don’t see this getting resolved at the County board level. Perhaps I am wrong and maybe it does work. As an investor I would want it to work so please know I am not advocating against it. We are just in the wait and see phase but will know soon enough. Stay tuned.




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  • Ititi Obidah
    Realtor · Atlanta, GA · Member since 2016 · 3 posts · 1 vote
    4y

    @Brad S. Thank you for adding value with this forum. I'm working with a client who is wanting to sell her second home located in the city of Atlanta(Fulton County). However, her son currently occupies the residence and she will be unable to move him until near the end of the year. Any suggestions on appeal to alleviate some of the tax burdens?

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  • Brad S.
    OP
    Specialist · Hoschton, GA · Member since 2022 · 21 posts · 29 votes
    4y

    @Ititi Obidah Thanks for the question and nice to meet you. Well, since the homestead exemption can only apply to one property which also has to be the current legal residence so that would be out of the question. Do you know if your client has filed an appeal recently? There are appeal strategies that would be available to your client that would essentially lock the value in for the current year plus two additional years. That’s one way to offset future increases. Residential properties in Georgia are based on market value as of January 1st each year so it would depend on what the sales and equitable comps are in your clients area. Since most homes in Fulton County are not cookie cutter and can differ one block from the next, you would have to look at the grade factor and compare that with the same graded homes as well as other property specifics. You can always message me if you have any further questions. Happy to help.

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