Increase Assessed Value for Extension and Renovation on 2 family house

Did anyone with an extension encounter a huge increase in assessed value and does anyone know if it can be reduced? i received the 2016/17 notice of property value and it shows a more than doubling of the Assessed Value (16,838 to 35,506; an increase of 18,668), the dept of finance doesn’t explain why the increase was so high. it doesn’t show what numbers they used such as increase in square footage, cost of renovations etc just the increased amount in the change column. using the tax formula for 2 family home of assessed value x 19.544% the property tax will more than double from $3,293 to $6,943\. can that be right? doe anyone know if this this can be reduced by appealing the tax commissioner? i downloaded the appeal form (TC108 2016) and in section 4 there’s some math where the market value is 1,743,000 x 6% = 104,580 and if the assessed value (35,506) is less than the calculated #, they won’t reduce. how does this make any sense, who pays tax on 6% of the market value the tax on that would be astronomical…but i digress. 311 doesn’t know how the math works, they see the same numbers i see. i appreciate anyone feedback from anyone that’s gone through this with extensions and renovations thanks in advance.

Guest User | 8 years and 9 months ago

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Guest User | 8 years and 9 months ago

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newhome1 no real advice, nothing that you prob haven’t read already. it’s a huge headache and it’s very expensive…so the more money you have to throw at it can alleviate some but not all the problems. if go into with just enough money then you should have lines of credit set up. it also depends on how large of extension, a small single floor will be less headache than 3 floors.

fraserlucas | 8 years and 9 months ago

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bklnreno we are about to embark on an extension. would love to chat if have any advise my email nhome2016 gmail com

Guest User | 8 years and 9 months ago

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Arkady, the Tax Commission & Dept. of Finance that you refer to do they take phone calls or you have to see them in person? can you see them at Brooklyn Business Center or do you have to go to the manhattan office? thanks

Guest User | 8 years and 9 months ago

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newhome1 yes i think the architecht did put the cost in that ballpark of 300k. imo that 300k shouldn’t all flow into the appreciation of the property, because part of it was repairs to get it liveable. thanks for taking the time to do some calcs.

Guest User | 8 years and 9 months ago

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<del datetime=”2016-02-27T19:21:53+00:00″>newhome1 yes i think the architecht did put the cost in that ballpark of 300k. imo that 300k shouldn’t all flow into the appreciation of the property, because part of it was repairs to get it liveable. thanks for taking the time to do some calcs.

fraserlucas | 8 years and 9 months ago

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bklynreno does that math make sense?

Arkady | 8 years and 9 months ago

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It’s too bad you missed one of the city-sponsored seminars where you could have asked people from the various agencies. But you can still talk w/ someone from the Tax Commission & Dept. of Finance. They have people who can explain these issues in understandable ways. You have until March 15th I think to enter an appeal to the Tax Commission (March 1st if it’s a Class 4.) You can download all the forms & have to turn them in in person.

billcash

in Taxes 8 years and 9 months ago

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Hi, I am facing a similar situation. I am considering the purchase of a 2-family townhouse (tax class1) that is being converted from a SRO (tax class2). The house has been gut renovated. The new COO is still pending approval. The sale is contingent to the conversion. Current property taxes are around $21,000. I am trying to estimate future property tax bills for the house. The city provides some very good documents: [http://www1.nyc.gov/assets/finance/downloads/pdf/brochures/class_1_guide.pdf](http://www1.nyc.gov/assets/finance/downloads/pdf/brochures/class_1_guide.pdf) [http://www1.nyc.gov/assets/finance/downloads/pdf/brochures/class_2_guide.pdf](http://www1.nyc.gov/assets/finance/downloads/pdf/brochures/class_2_guide.pdf) **For Class 1 we have:** Property tax = Assessed Value * 19.5% = (Market Value * Assessment Percentage) * 19.5% with Assessment Percentage = 6% In addition, property taxes cannot grow more than 6% per year or 20% in 5 years. **For Class 2 we have:** Property tax = Assessed Value * 12.5% = (Market Value * Assessment Percentage) * 12.5% with Assessment Percentage = 45% Whereas, for Class 1, Market Value is based on recent surrounding transactions, for Class 2 it is based on potential expected revenues from the property. If you apply the above rule for Class 1 using recent transactions in the neighborhood in order to assess market value, you get a number pretty close to current taxes paid under Class 2 (>$20,000). However, this number is much higher than property taxes paid by most surrounding buildings under Class 1\. This is likely explained by the fact that those buildings benefit from the 6% maximum annual tax increase cap. **Hence my question:** Will my new property taxes under Class 1 benefit from any lower assessment value (in line with neighbors), or should I expect paying taxes based on the full market value ? I have asked many real estate professionals and no one seems to have a clear answer.

resident2 | 8 years and 9 months ago

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You have got off lucky. Many, many owners doing huge fancy renovations or people that have recently bought a brand new “Fixed Up” house are going to have their heads spinning. If you have time on a rainy day just look up some the buildings that have had huge renovations over the last few years…. their new tax bills are $25,000 – 30,000! That is if their architects filed it all by the book. The suburbs begin to look more inviting……