What are the benefits of owning a tax-abated property? – Jessica Rasmussen
On this episode of The Closing Table, we sat down with Jessica Rasmussen!
To watch the full episode, check it out on YouTube below. In the meantime, here’s a summary of the conversation…
Here’s what you missed from Jessica Rasmussen…
The conversation began with a word association icebreaker on escrow, short sale, warranty deed, and more. Jessica is not only a real estate professional but also a person with a rich personal life. Beyond her career, she is deeply rooted in her family and enjoys spending quality time with them. After moving to Hudson a few years ago, she and her family left behind a small yard and gained an expansive plot of land, spanning almost an acre. This new setting allows her to be close to her immediate family, who also reside in the area, and she cherishes the moments spent with her nieces and nephews. In addition to her love for family, Jessica has a passion for various domestic activities such as baking, cooking, gardening, and creating a comfortable home environment. Her homebody nature reflects her affinity for the coziness of her personal space.
Geographically, Hudson is a picturesque town conveniently located within a 30-minute drive from both Cleveland and Akron. This prime location offers residents easy access to the amenities and opportunities of two vibrant cities. Economically, the market in Hudson is facing a notable challenge—insufficient inventory. Jessica informs us that there is a high demand from eager buyers, patiently waiting for the right properties to become available. In terms of market statistics, the average time it takes for a property to be sold in Hudson is around 36 days. The average square footage price is approximately $2,500, reflecting the value of homes in the area. Furthermore, the average sale price hovers around $475,000, indicating a healthy market overall. However, the limited inventory is a notable factor affecting the current real estate landscape in Hudson.
Dogs are often regarded as cherished members of the family, and their unique needs can significantly influence the process of buying a new home. Understanding and accommodating these requirements is an essential aspect of Jessica’s approach when assisting clients with pets. When working with clients who have dogs, particularly larger breeds that require more space, Jessica takes into account the necessity for bigger yards and fenced-in areas. Some homes already come equipped with invisible fence systems, which are highly desirable for pet owners. However, there are limitations associated with certain dog breeds due to city ordinances designating them as “dangerous.” It is crucial to ensure that the chosen property welcomes and accommodates beloved pets to avoid any potential conflicts.
Jessica has encountered various challenges related to finding pet-friendly properties. For instance, she has had clients interested in livestock, but some neighborhoods have restrictions prohibiting such animals. Additionally, zoning regulations play a role in determining what is permitted on a property. For example, if someone wants to have a horse, the property must have a minimum of 2 acres. These zoning rules are in place to maintain the well-being of the neighborhood.
In the home-buying process, it is customary for lenders to order property appraisals. However, in certain situations, a hybrid appraisal may be requested by the lender. A hybrid appraisal involves sending an appraiser in training or a real estate agent to the property instead of the main appraiser. They take photos, measurements, and gather all the necessary data to be provided to the head appraiser for the final report. Jessica personally dislikes this approach, as she believes that valuing a property requires firsthand observation. There are numerous variables and unique characteristics associated with homes that may be missed by a non-appraiser. She also shared a personal story in which an appraiser saved her and her husband from making a significant mistake when purchasing their first home.
When discussing a specific townhouse listing, Kevin mentioned that the property Jessica has a tax abatement in place until 2028. Jessica explains that a tax abated property is part of a residential tax abatement program in which the increase in real estate property tax is entirely eliminated. These programs are typically implemented to attract development to areas that require revitalization. In the case of Cleveland, they have successfully utilized tax abatement programs to bring more development to their west side communities. Builders who participate in these programs are required to construct homes that meet green home standards, ensuring that the property is environmentally friendly with features such as certified furnaces and energy-efficient lighting. Once the city approves the home, the buyer of the tax abated property only needs to pay taxes on the land where the property is situated. It’s important to note that tax abatements are not permanent and typically expire after 15 years.
Of course, owning a tax abated property comes with both pros and cons. In the case of Cleveland, the program initially brought new life and development to the neighborhoods. However, it also led to the displacement of long-time residents, as newcomers purchased high-value townhouses and paid significantly lower taxes compared to the existing homeowners. This created an unfair burden on the original residents. As property values and prices increased due to the influx of developments, so did the taxes for existing homeowners. To address this issue, Cleveland has introduced a more equitable approach to tax abatement. They have implemented caps, starting at around $350, and no longer provide a straight 15-year abatement. Instead, the abatement period is capped at 5 or 10 years, depending on the property’s value. Furthermore, efforts are being redirected towards other areas of Cleveland that are in greater need of development, ensuring a more balanced distribution of benefits.
The conversation wraps up with Kevin asking Jessica about what kind of project she would want to work on if given unlimited resources and time. Jessica expresses her interest in developing a remarkable cluster home community catered to retirees, with a specific focus on the baby boomer generation. Being in a highly suburban environment and having baby boomers as parents who are now retired, she recognizes the need for innovative and appealing housing options for this demographic.
Check out Jessica Rasmussen:
Facebook: https://www.facebook.com/jessica.rasmussen.realtor
Instagram: https://www.instagram.com/p/CeZDjc2r4AW/
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