[angelo129]

Relatives of ours, a married couple in their thirties, will be moving to Vermont within the next six months. They're going into business (an already well established one) with a friend and will have a reasonable and stable income (inasmuch as anyone does in the present economy). They're interested in buying a condo, and have been looking at quite a few online (in the Upper Valley) to see what's available. Maybe someone on this board can answer a question for them, since we're renting and don't know what's involved in buying a house in Vermont.

They've found many nice-looking condos online, and searching on zillow and trulia shows that these condos have dropped enormously in price over the last couple years. Some that were in the $300,000 range are now closer to $100,000. However, they're still valued, for property tax purposes, at their prior values. The result is that you have $110,000 condos (which, for what it's worth, I think were way overvalued and are now reflecting more like their real worth) with $6,000 a year property taxes. If they were to buy one of these condos, will the property values be adjusted to reflect the price they paid or will they stay the same? Our relatives would be understandably afraid to take on a place with low value and enormous taxes, especially since those taxes are likely to rise. I certainly couldn't advise it and, for them, it would be a deal breaker. Does anyone know the answer?

[jenny1951]

Originally Posted by angelo129

Relatives of ours, a married couple in their thirties, will be moving to Vermont within the next six months. They're going into business (an already well established one) with a friend and will have a reasonable and stable income (inasmuch as anyone does in the present economy). They're interested in buying a condo, and have been looking at quite a few online (in the Upper Valley) to see what's available. Maybe someone on this board can answer a question for them, since we're renting and don't know what's involved in buying a house in Vermont.

They've found many nice-looking condos online, and searching on zillow and trulia shows that these condos have dropped enormously in price over the last couple years. Some that were in the $300,000 range are now closer to $100,000. However, they're still valued, for property tax purposes, at their prior values. The result is that you have $110,000 condos (which, for what it's worth, I think were way overvalued and are now reflecting more like their real worth) with $6,000 a year property taxes. If they were to buy one of these condos, will the property values be adjusted to reflect the price they paid or will they stay the same? Our relatives would be understandably afraid to take on a place with low value and enormous taxes, especially since those taxes are likely to rise. I certainly couldn't advise it and, for them, it would be a deal breaker. Does anyone know the answer?

The property will be taxed at its assessed value. Your friends may or may not qualify for a significant property tax rebate depending upon their income. Reassessments are done every few years, but in 21 years in the Upper Valley, I have yet to see a reassessment go down. That is a very good point.

[tkln]

We have been looking at homes recently and have come across similar situations where the taxes reflect the value of the house from several years ago. We were told that the house would be reassessed and the taxes would lower to reflect the new value.

[jenny1951]

Originally Posted by tkln

We have been looking at homes recently and have come across similar situations where the taxes reflect the value of the house from several years ago. We were told that the house would be reassessed and the taxes would lower to reflect the new value.

My taxes increased last year, with no reassessment. I would love to hear from someone in Vermont who has seen a tax reduction in their town.

[jenny1951]

Here is a link to appealing property tax assessments:

Vermont Secretary of State - Handbooks

[angelo129]

If I were buying a house and the taxes reflected a value the house no longer had, I wouldn't even consider buying it unless those taxes were adjusted before the sale. Who in their right mind would just gamble on the possibility of a successful appeal when so much money is at stake? I know my young relatives wouldn't consider buying on that basis. "We were told the taxes would come down" is a long way from a guarantee of anything. It would be naive to go ahead on that basis. I would think that homeowners who are trying to sell and whose property values have dropped could make a very good case for a lower assessment, since they could prove that the value had gone down. On the other hand, if a buyer goes ahead and accepts the high taxes, and buys with the hope of having the property reassessed, they could very well be told that they knew what the taxes were and implicitly accepted them when they bought the house - so they don't have a very good case, and shouldn't have made assumptions.

[jenny1951]

Originally Posted by angelo129

If I were buying a house and the taxes reflected a value the house no longer had, I wouldn't even consider buying it unless those taxes were adjusted before the sale. Who in their right mind would just gamble on the possibility of a successful appeal when so much money is at stake? I know my young relatives wouldn't consider buying on that basis. "We were told the taxes would come down" is a long way from a guarantee of anything. It would be naive to go ahead on that basis. I would think that homeowners who are trying to sell and whose property values have dropped could make a very good case for a lower assessment, since they could prove that the value had gone down. On the other hand, if a buyer goes ahead and accepts the high taxes, and buys with the hope of having the property reassessed, they could very well be told that they knew what the taxes were and implicitly accepted them when they bought the house - so they don't have a very good case, and shouldn't have made assumptions.

I agree 100%. It's too much of a longshot to gamble on. Town budgets are already stressed to the max where I live. Any buyer has to be prepared to accept the property taxes and current assessed value.

[angelo129]

Originally Posted by jenny1951

Here is a link to appealing property tax assessments:

Vermont Secretary of State - Handbooks

Thanks, Jenny1951, for that link. I read the 44 page handbook. Alright, I admit I skimmed it with an increasingly glazed look on my face. It becomes very quickly apparent that, if your property is unfairly assessed, you may have some slight possibility of reassessment (no guarantees!) if you have unlimited time and money to spend. And then, of course, you have to consider the appraisers and lawyers you'd have to hire to prepare your case, and you'd have to be prepared to lose the undoubtedly hefty fees you'd pay to them regardless of whether you won or not. It's really disheartening. As much as we like Vermont, we wouldn't buy a house here even if we won the lottery!

[jenny1951]

Originally Posted by angelo129

Thanks, Jenny1951, for that link. I read the 44 page handbook. Alright, I admit I skimmed it with an increasingly glazed look on my face. It becomes very quickly apparent that, if your property is unfairly assessed, you may have some slight possibility of reassessment (no guarantees!) if you have unlimited time and money to spend. And then, of course, you have to consider the appraisers and lawyers you'd have to hire to prepare your case, and you'd have to be prepared to lose the undoubtedly hefty fees you'd pay to them regardless of whether you won or not. It's really disheartening. As much as we like Vermont, we wouldn't buy a house here even if we won the lottery!

I see many folks on the Long Island forum asking how to file a grievance for their taxes (which are among the highest in the country) and it sounds like the same long, daunting and most likely unsuccessful process. I think this probably applies to the entire country. Real estate values have plummeted, but property tax assessments remain the same.

[FrugalYankee]

Originally Posted by angelo129

If I were buying a house and the taxes reflected a value the house no longer had, I wouldn't even consider buying it unless those taxes were adjusted before the sale. Who in their right mind would just gamble on the possibility of a successful appeal when so much money is at stake? I know my young relatives wouldn't consider buying on that basis. "We were told the taxes would come down" is a long way from a guarantee of anything. It would be naive to go ahead on that basis. I would think that homeowners who are trying to sell and whose property values have dropped could make a very good case for a lower assessment, since they could prove that the value had gone down.

Umm no. The towns generally could not care less if homeowners are having trouble selling their houses becuase of outrageous property taxes. Their attitude is "we need the money," period. I've seen people deliberately stop paying taxes so that the town ended up auctioning off the house with the spouse of the original delinquent taxpayer buying it for next to nothing. Other than that I know of no way to "adjust" property taxes to make it easier to sell a home in Vermont.