Tax Abatement Details
The City of Cleveland has offered some developers of new residential condos and lofts the ability to not pay property taxes for up to 15 years.
When searching for a Cleveland condo or loft you must pay attention to what ones have a tax
abatement. You could have the opportunity to avoid paying any property tax (you would still pay for land in any situation but this is very minimal). Some of the tax abatements have already started to run out their 15 years and it is important to ask or research this before you buy. It significantly increases your buying power! We have listed some of the projects with partial abatements (not full but partially run out and/or not 100%) and others that are full (100% Tax Abatement but may not be for 15 years). Each condo will have its own situation that must be understood in order to make a good decision.
Cleveland Crain's Article:
Cleveland's abatements a plus
By JAY MILLER
3:54 pm, February 27, 2007
Though it’s a program that reduces taxes for property owners, the city of Cleveland’s 20-year-old residential tax abatement program eventually will generate new property tax revenue for the city and the county, according to a study released by Cleveland State University.
Mark S. Rosentraub, dean of CSU’s Maxine Goodman Levin College of Urban Affairs, told Cleveland City Council this morning that the increased tax revenue can be attributed to the city’s tax abatement policy largely because 60% of Cleveland home buyers chose the city due to the availability of the abatement.
The Cleveland State study says the city, the Cleveland Municipal School District and Cuyahoga County will receive $53.8 million in new property taxes between 2007 and 2020 from properties that have already been built but that would not have gone up without tax abatement.
That figure is based on responses to a survey of 400 recent Cleveland home buyers. CSU found that 60% of the respondents said they would not have purchased homes in the city were it not for tax abatement.
“The city was attractive because it allows (the homebuyers) to get more house for the money,” Mr. Rosentraub said.
While the homes themselves do not immediately increase tax revenue because they are abated, the study found that the homes’ land value, which is not abated, is increasing, as is the values of nearby properties that do not have tax abatement. Residents also pay payroll taxes to the city.
The city of Cleveland offers 100% tax abatement for 15 years for any new or rehabbed housing in the city. City Council must decide this year whether to continue the existing policy, eliminate tax abatement altogether or modify it.