Flipper/Rehabber · Chicago, IL · Member since 2016 · 123 posts · 38 votes
Cash flow in Chicago and South 'Burbs is great. But the biggest killer is the redic property taxes.
There are two single family houses we're looking at now; we'll be allin for under 50k on each with purchase and rehab. Rent will be around 1400/month.
BUT property taxes are currently 4.5 and 5.5k for each!
There is a loophole that allows landlords to make tenants legally responsible (in their lease) for property taxes through the payment of their rent. And this qualifies the landlord for the homestead exemption.
Have landlords used this or ANY other tactics to lower the property taxes?
Residential Real Estate Broker · Chicago, IL · Member since 2014 · 155 posts · 42 votes
7y
South burbs have higher properties taxes due to minimal retail and industry to tax. I have seen many great deals with taxes usually over $5500+ on average.
Chula Vista, CA · Member since 2017 · 195 posts · 104 votes
7y
When I bought in Chicago heights at the end of 2017, the lender didn't provide the taxes without the homestead credit (I'm OOS) and that hurt cashflow but then the taxes went up the next year and I'm paying almost 8k on a house I bought for 93k.
If the loophole you suggest exists, just for the homestead credit, that's amazing. Hopefully a RE lawyer or CPA can chime in.
Currently I just appeal the appraisal like most people. Good luck.
"There is a loophole that allows landlords to make tenants legally responsible (in their lease) for property taxes through the payment of their rent. And this qualifies the landlord for the homestead exemption. "
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No, it allows the TENANT to claim the exemption, not the landlord.