Quote:
Originally Posted by parrotheadmomma
I've seen what you are referring to as specials listed under the info for houses to buy but I have no idea what that means?
|
Each area of the country does this different and call it different names. In California I saw it referred to as Mello-Roos. But "specials" are what the homeowner pays when the city does improvement projects such as new streets, sidewalk repairs, etc that affect the homeowners property.
Most specials are for new roads, lights, sewers put in a new subdivision and thus most specials are only tagged onto newer homes. Most older homes in established neighborhoods (say 15 yr old homes and older) will have been there long enough for any "specials" for the roads, lights, sewer put in when the home was built to have been paid off.
Confusing..... hard to explain. But my house was built in East Grand Forks MN (across the river from GF) in 2003. Street was gravel with a drainage ditch in front. By late 2004....a majority of the lots had been developed on our street...and the city law says that once that occurs the residents can gather a petition and ask the city to develop plans and prices for street paving (concerete curb and gutters). 50 pct of the homeowners must sign it before it is present to the city council. Once this is done...the city council will ask for bids for the project and plans. The city comes back and says it wll cost XX amount of money to pave the street. The look at the length of the street and divide the cost by the length (ft) and access a "special assement" of xx amount per ft. Our lots are 90 ft wide so I have 90 ft width on the street so my house is assesed xx dollars times 90 to get the total amount that my property will be assesed. I get this in the mail and a hearing is done and unless objections the project is started to pave the street. The city will then pay the developer...and the homeowner enters in an agreement with the city to repay the city xx yearly amount of money over a 15 or 20 yr period (plus interest).
So for example...in Grand Forks....typical 200,000 dollar home would have real estate taxes of about 4300 per yr (about 2.2 pct of amount assessed).
In addition, a new street was done and the home was assessed 20,000 over a 15 yr period. (plus interest). We would owe an additional 1800 per yr in special assessments. (I am doing this roughly so apologize if these calculations are not mathmetically accurate).
So total tax and specials would be about 6100/ yr total.
Things to keep in mind when looking to purchase.
Now for older homes (more than 15 yrs old) in established neighborhoods with streets/lights/sidewalks in specials will have been paid off or very very low.
Hope it makes sense.... Now if you rent a townhome, apartment, etc you dont have to worry about this as the owner of the place pays any taxes/specials. So when looking around for rentals if you see a price you dont have to add anything to it.
Dan
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
2 students rent apartment during the summer
