Assume the worst and run your numbers using that assumption. If they do not immediately re-assess, then it may happen at the next scheduled county-wide reassessment. Ours happens every 3 years.
So I should assume that the taxes will triple and run my numbers with that higher figure?
Ask @Account Closed , he's the Newburgh guru on BP.
@Will McGuire you want to do the Historic Exemption as you mentioned above. Does this property need a renovation or someone is flipping it? If it is the latter, I may be wrong, but I don't think you would qualify for the Historic Exemption. My understanding of it is that since you would be improving the property, and it would be worth more post renovation, that is where you would be saving. For example- Lets say a house is assessed at 100k, you buy it for 100k, and put in 100k. The home is now worth 200k... Instead of paying the full boat of taxes on the 200k, the city will keep the assessed amount at the 100k for the 1st 5 years, then increase 20% per year of the fully assessed value for the remaining 5 years.
If you are buying someones flip, I would assume the taxes would triple. Unless they did the historic tax credit? Im not sure if this can be passed down to a new buyer or not. @Sarah Hooff may know who happens to be an excellent agent should you be in need of one.
@Justin S. thank you so much! I spoke with the tax assessor and she told me that as long as the historic exemption hasn't been applied for as of yet, I should still be able to qualify. However I don't want to put all my eggs into that basket and then be screwed down the road. Thanks again for your help!
@Will McGuire good to know. Good luck
That’s a scary thought! I’ve looked at a ton of places in Newburgh and the taxes are so high I just couldn’t justify buying any buy and holds for myself. Especially when accounting for the increased assessment after my value add. To be honest between that and the NYC investors bidding up prices banking on Newburgh being the next Brooklyn I’m not sure how anyone is getting any cash flow really
@Louis Aller , If you do it right, there is money to be made. I underestimated the rents myself but the demand is there. There is no denying the city is hot and has an enormous amount of momentum. You can feel it as you walk around Liberty. They just opened up a Crossfit down by the brewery. All positive things going on it the city of Newburgh right now. If you take advantage of some of the programs that are out there right now, such as the tax exemption, you are basically banking on the city being in much better shape in 10 years from now then it is today. Im taking that bet.
agree with you there is money to be made if done right. I was born in st Luke’s hospital on Dubois street and know the market/area there well. The city has a very different feel than it did then especially in the gentrifying areas. I think we’ve hit a critical mass where the nyc investors are being drawn up from downstate and prices will only climb. At this stage you can probably buy a bad deal sit on it and get bailed out by the rising tide/speculation. The downside being that they’ve inflated purchase prices MUCH more than rents which compressed the cap rates
Taxes are the #1 issue with investment in Newburgh, @Will McGuire
Plan for the worst possible tax load, and then hustle to keep it down through abatement programs and assessment grievances each year. Welcome to the City!