Community Development Charges, Property Taxes & Abatements on New Homes

Community Development Charges, Property Taxes & Abatements on New Homes

Community Development Charges may be assessed by developers of new subdivisions to pay for roads and infrastructure. These charges are added to your property tax bill or can be paid directly to the local development authority. Property taxes on the other hand are much lower on new builds than on existing homes. In so-called Community Reinvestment Areas you may not have to pay any property taxes for year.

Community Development Charges

Many new suburban communities impose a Community Development Charge to pay for infrastructure and roads. It is based on the assessed value of your home. (Note: the assessed value is 35% of the market value.)

In Jerome Village this charge is 0.95% of the assessed value. The cost for a $350,000 home would be $1,163.75 in 2017. Click here for details.

Lower Property Taxes on New Builds

Property taxes are paid in the arrears. The property tax bill due on June 20th, 2017 (in Franklin County) pays for the second half of 2016.

When you move into a new house your first tax bill will only account for the value of your lot. The county treasurer will adjust your property taxes once the value of your home has been established. You will likely see a substantial increase in your tax bill in your second year.

As your property taxes come due 6 to 12 months later, buyers get a tax credit when they buy a house. This credit covers the time the seller lived in the house (till closing), but property taxes were not due, yet.

Some builders pre-pay property taxes on new construction and may not give you the credit at closing. Instead, you have to request a refund from the builder.

Property Tax Abatements

If you move to an area with a valid tax abatement, you may not have to pay property taxes for up to 15 years. Some new condos in the Short North and Downtown Columbus are still tax abated. You could save thousands of dollars, if you buy in these areas.

The City of Dublin created its own Community Reinvestment Area in the Bridge Street District. A City Ordinance from 2015 states that new development can be 100% abated from property taxes for 15 years. According to this memo new condos developed along North High Street may qualify for a tax abatement.

Call me at (614) 975-9650 before you visit a model home or talk to a builder’s rep. I can guide you through the process, help you decide where to build and which features to select for maximum resale value.

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About the Author

Susanne has helped more than 500 home buyers or sellers in the past 3 years. She is consistently ranked among the top 1% of all real estate agents in Central Ohio. Connect with her on Google+ or call or text her at (614) 975-9650.

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