Posted by & filed under Buying.

using up your savingsUsing Up Your Savings

Using up your savings to buy anything is never a good idea.  Buying a car, a flat screen TV or a house should never empty your savings account.  Let’s see why this happens so often and how to avoid it.

How Much Do You Need To Buy A House

Don’t you just hate it when people answer with “It depends.”  What does that mean?  Why don’t they just give you an answer?  Because it really does depend on your personal circumstances.  There are, however, some absolutes.

Banks require that you prepay your homeowner insurance 1 year in advance and escrow 3 month’s of mortgage payments.  Let’s say your mortgage payment is $2,500 and insurance is $1,200.  This totals $8,700.  Title search and insurance is around $2,000 on a $350,000 house.  Add $750 for a survey and $1,500 for legal expenses.   Down payments can be 3.5% with a FHA mortgage or $12,250 on that house.  There are also bank fees and inspection costs.  You are soon close to $30,000.

I bet a lot of you were never told this when you got “pre-approved”.  It’s not your fault.  Marketing gurus teach you to look in the wrong direction.  Read about Mr Happy Banker and you’ll understand why. 

Can you see why so many people have nothing left in savings after buying a house?  Because no one tells them what it really costs.  Mr using up your savingsHappy Banker doesn’t.  Websites don’t.  My experience is that if they give you any estimate of costs, it’s less than reality.  When you really find out how much it costs to buy a house, you use up every penny you have.  You might even have to ask a family member for help.

The only solution is to sit down with an ethical banker from an excellent bank.  It’s the only way to protect yourself.

Money Management and Starbucks

One day my niece Alyssa calls me up.  Aunt Barbara, I need help!  I’m in trouble!  This is a great kid who’s a senior in high school so I’m thinking it can’t be too bad.  What’s the problem?  My father is going to KILL me!  Why Alyssa?  Because I used up too much gas driving around and I don’t have enough money to buy more.  Ok, where are you?  Starbucks.  How nice.  Are you with your friends?  Yes, we come here all the time.  What are you having?  A sandwich and a caramel macchiato.  Hmmm….I have a solution for you.  Really Aunt Barbara?  Yes, it’s only 25 feet away.  It’s called McDonalds.  You can get a cup of coffee there for $1. Get the point?

Money management makes you a saver.  Of course I helped out my niece but only 1 time. She did learn.  IF she went to McDonald’s for coffee rather than paying around $7 for a mocha whatever, she’d have $6 in her wallet.  Multiply that by 3.  That’s $18.  Multiply that by 45 weeks (figuring most not all weeks) for $810 in savings.  Now multiply that by 5 years for $4,050.  This gives you an extra $4,100 to put down on a house.

saving for a down paymentSaving for a house or anything else requires some financial discipline. 

The ONLY way this really happens is with a written goal, a written plan.  It’s all those small things that add up to a lot.  Here’s something else.

Cook.  No kidding.  Cook.  Buying takeout is expensive.  When you’re home on a weekend, say Sunday night, do some cooking and then freeze it.  Make a ton of meat sauce. Use freezer bags to freeze  dinner sized portions.  You don’t need to be a gourmet cook.  Buy nice bottled sauce, brown ground meat that you add some spices to, throw it together and you’re done.  All you have to do one night is boil pasta while you defrost the sauce.  Add in a salad and it’s a great meal.  30 minutes for less than $5.  Order that in and it’s $25-30 for 2 of you.  Cooking 2 meals each week and not ordering in will save you $40 per week.  $40 x 52 weeks = $2,080 per year x 5 years = $10,400.

By not eating out 2 nights each week, eliminating expensive high calorie coffee 3 times most weeks you get $15,000 in 5 years.  It’s easy.  Put what you would have spent in a savings account every week.  This is what money management is all about.  Using up your savings for expensive coffee and ordering food is ridiculous.  It’s not hard with a written goal and plan.

The Danger of Using Up Your Savings

Things happen in life.  The furnace breaks one winter.  You might be out of work for a while.  Unexpected medical bills happen.  You owe more taxes than you thought.  Life has it’s unhappy surprises. Without at least 3 months of expenses in a savings account, you’re in trouble.  There is no cushion.

What do you do?  Some people put it on the credit card.  Big mistake because now you’re in debt.  Some people use their retirement financial planningfunds.  HUGE mistake.  Hardly anyone puts it back.  Others use their line of credit on their house.  This is yet another mistake.  By the way, I don’t care what you read or who tells you to do this, never ever borrow on your retirement funds to buy a house.

Buy a home right.  Don’t use up your savings but do have at least 3 month’s worth of expenses in the bank.  Don’t put yourself in a perilous position.  Be financially careful so you’re not worried every month.  Use the services of a great banker.  Need one?  I know several.  Take good care of yourself.

 

Posted by & filed under Buying, Uncategorized.

home buyer mistakes

Introduction

First time home buyer mistakes can be deadly.  While home buyers today do a lot of research on the web, they are still vulnerable.  Because of this, I’ve written a series of 10 articles.  One for each issue.  Today we begin with the #1 – Getting pre qualified.

A List of First Time Home Buyer Mistakes

First time home buyer mistakes to avoid are the following:

  1. Getting pre qualified
  2. Using up your savings
  3. Mortgage shopping by rates
  4. Not checking your credit report
  5. Hiring an attorney based on cost
  6. Not researching the neighborhood
  7. Not checking daily rush hour traffic
  8. Choosing a home inspector last minute
  9. Thinking all real estate agents are the same
  10. Buying the Money Pit because you’re too emotional

Let’s look at these first time home buyer mistakes in depth now starting with #1.

first time home buyer mistakesGetting Pre Qualified

You can define anything any way you want. Mortgage companies take advantage of this.  I call this a Mr Happy Banker experience.

Mr Happy Banker does not ask for all the documents that Mr Professional Banker does.  He’s easy and  does what you want.  You’ve found the right banker.  He gives you a pre-approval right away without the hassle.

There is one problem – you don’t have a pre-approval.  Mr. Happy Banker really gave you a totally meaningless pre-qualification.  He just calls it a pre-approval because that’s how he defines the word.

A true pre-approval is a preliminarily underwritten loan approval.  You have to sign an application for the loan, gather up your last 2 years of tax statements, bank/financial statements for the past few months, pay stubs, employment verification, etc.  This is a royal pain in the neck.  It takes time and effort.  It’s also not immediate.  Getting a true pre-approval can take 24-48 hours.

Mr Happy Banker does things differently.  He doesn’t ask for much if anything at all.  He rockets over a pre-approval sometimes in 15 minutes.  This is so much easier!  Nothing is verified as it is with Mr Professional Banker.  As a result pre-qualifications are not more than a good educated guess.  BUT Mr Happy Banker calls this a pre-approval.

So why is this a problem for you?  Because you don’t know what you can afford or the true costs.  You will make an offer on a house without knowing what it will really cost you.

I do not honor offers on my listings with meaningless pre-qualifications.  No good listing agent will.  How can you get the house you want if a listing agent tells the owner they can’t verify your financial ability?  Avoid this first time home buyer mistake by avoiding Mr. Happy Banker.  This section of my website tells you exactly what to do.

Posted by & filed under Uncategorized.

bergen county real estateBergen County Real Estate – 1st Quarter 2018

We are through the 1st quarter of the year so it’s time to look at how Bergen County real estate is doing.  We are doing very well indeed.  Looking at Bergen County as a whole, there should be no surprise to see sales are down.  This is due to a lack of homes for sale and not demand.  This has been a constant theme; I see no reason why things will change this year.

Closings are down 6% while demand continues to grow.  You can see this in the fewer days on market – 75.4 this year from 83 last year.  Prices did go up by 2%.  Median prices are down by 4% which makes sense because 1st time home buyers are coming into the market at a very strong pace.  This is a major reason why price appreciation is projected to continue.  These folks fuel the real estate market.

Consider Under Contract performance too.  This is the most current view because 1st quarter closed sales really come from then end of last year.  So what does this tell us?  We see again the impact of low inventory because we’re down 2% while prices are up 4%.  This proves that demand is strong but we just don’t have enough houses to sell.

Why We Are Important

Bergen County real estate is watched closely because it’s important on several levels.  We are New Jersey’s most populous county with bergen county real estate948,706 residents according to the US Census Bureau.  This is 10.5% of the entire population of New Jersey.  As a result, our size alone makes us important. Location is important too because we are next to Manhattan – only 1 mile across the Hudson River.  While being close to NYC is significant, our economy is very diverse and not all of us commute there for work.

We remain, however, one of the premiere NYC metro locations.  Our schools have a well deserved reputation for excellence,our population is highly diverse and we are one of the most affluent counties in the United States.  Because of our size, proximity to Manhattan and everything we offer, Bergen County is an important location in the US as well as in New Jersey.

The Bottom Line

The Bergen County real estate market enters 2018 positively.  Demand is strong while inventory is low.  First time buyers are out in force because homeownership matters greatly and people have confidence in the future.  While interest rates have risen they are still low at around 4.5% for most buyers.

If you are selling your home 2018 is another great year.  There are things you need to get the best price.  You’ll find this and other help on my website.  Just click here

If you are buying a home this is a challenging but not impossible market.  To do the best for yourself you need the right guidance and strategy.  It’s essential to be fully prepared.  Go to my buyer advice  for the help and guidance you need.

Posted by & filed under Uncategorized.

How to get a great mortgage rate.The Best Place to Start

How to get a great mortgage rate involves several different aspects of your life.  While all of them are important some are more so than others.  The best place to start is to find a great banker.  I’ve said it before and I’ll say it again – I love the internet but nothing replaces a great mortgage professional.

A great banker will do more than quote you a rate and give you a monthly payment figure.  He or she will have you come in to their office so you can sit down in privacy and go over your needs, your plans, your finances.  You will learn the mortgage process, what you need to do and which mortgage product is best for you.

Debt to Income

Your debt to income ratio is a huge piece of the mortgage puzzle.  This is a critical factor in qualifying for a mortgage and it should be.  No one should get a mortgage loan they can’t afford.  Your debt to income ratio determines this.  It determines your mortgage rate too.  As a result, you want your debt amount to be as low as possible.

Let’s look at how much you owe on credit cards.  That’s debt.  Here’s where you need the help of a great banker who can advise you on what to do.  Believe it or not, paying off a credit card is not necessarily the best idea.

Student loans are a common source of debt.  So are car leases as well as car loans.  The bottom line is to remove as much debt as you can strategically.  You establish the best strategy with your banker.  Lowering your debt to income ratio is how to get a great mortgage rate.

Savings

You need a certain amount of cash to pay for a down payment, your home inspections and your closing costs.  You should also have at least 3 months (6 is preferable) How to get a great mortgage rate.worth of your monthly expenses in a savings account.  I know it’s impossible to figure your closing expenses precisely initially.  However, you can get an extremely accurate picture from your banker.

Let’s be honest.  Saving money isn’t easy.  Most of us barely make it through the month.  You would really be surprised at how well you’ll do if you have a written plan.  I don’t know what goes on in the human brain.  But, write down a plan and it usually happens. So create a savings plan for yourself today.

Spending

Don’t buy or lease anything.  No kidding at all on this.  Getting ready for a mortgage is no time to go shopping.  This directly impacts your debt to income ratio and possibly how much money you have in a bank account.  You want to build up your cash reserves as much as possible so put off getting a new car, buying a washing machine etc.

Like a savings plan, putting off spending is often a happy revelation for people.  Beyond just saving what you would have spent, you enhance your financial profile.  Whenever you lease a car, get a credit card to save 10% that day etc. your credit is pulled.  This is a credit inquiry and every credit inquiry lowers your credit score.  Too many credit inquiries in a short period of time – even within 12 months – raises a red flag to banks.

Check Your Credit Report

how to get a great mortgage rateYour credit report is something you need to check to protect yourself.  Mistakes are made.  The FTC found in 2015 that 25% of all credit reports had errors.  If you do a Google search you’ll find numerous articles saying 1 out of 5 credit reports have errors and there are many with serious errors.

It takes time to dispute a mistake and get it rectified.  Months of time are required to fix things and see your FICO score go up.  So check your credit report way before you seek a mortgage.

You can see now that how to get a great mortgage rate involves many things.  It should also how to get a great mortgage rateinvolve the help of a great mortgage banker.  Finding such a person to help and guide you is essential.  When you’re ready to start shopping for a house, you’ll identify the type of loan that’s best for you with your banker.  Getting prepared early on makes sure you’re in the best possible position.

Enrico “Rick” Casatelli is a great banker.  He’s my mortgage advisor at the office and I consider his help invaluable.  Give Rick a call at 201-569-7888, Extension 8802, at the office or email him at ECasatelli@weichertfinancial.com

Posted by & filed under Buying.

west orange townhousesWhy This Is Important For You

West Orange townhouses are a bargain compared to Bergen County prices.  While I am a Bergen County real estate agent, I made it a point to know about other  locations too. As a result, I can get you a much better purchase because I can show you more options.  West Orange townhouses are about half what they would cost in Bergen County.  When I have buyers who don’t need the Bergen County location, I bring them there.

Here’s another example:  Lincoln Park NJ.  In Lincoln Park you will find the Hovnanian Society Hill townhouses just like you will in Mahwah.  Because Lincoln Park is further from Manhattan, they are less expensive.  They also have more amenities such as a 9 hole golf course.  If you don’t need to be in Bergen County this could be much better for you.

The Villas at Crown View

Crown View is a gated community staffed by a guard 24/7.  There is an outdoor pool, tennis courts, playground, exercise room west orange townhousesand jogging/walking paths along a lake.  These are stand alone townhouses.  That’s right – not connected to another.  As a result, it’s like buying your own house.  Crown View is also pet friendly.  You can have as many cats or dogs or whatever as you wish.

There are several townhouse styles with the smallest being at 1,884 sq ft and the largest at 2,307 sq ft for the 1st and 2nd floors.  They all have very large 2 car attached garages and are 3 bedrooms with 2.5 baths.  The floor plans are like a colonial home.  You’ll find a living room, dining room, kitchen, powder room and family room on the 1st floor.  The 2nd floor has a Master Suite with 2 walk in closets and large full bath.  There are also 2 other bedrooms, a laundry closet and an open loft area.

These units have have nice basements that can be finished with decent ceiling heights.  If you finish the basement your living space comes to nearly 3,000 sq ft for the smaller units.

Some of the larger units have deep yards that back onto the lake side of the street.  Those can sell for just over $500,000.  Many recent sales for the average sized units have been in the low to mid 400’s.

west orange townhousesMaintenance fees are moderate at $410 per month.  This includes all the amenities, snow removal (including your front steps and walk) and exterior lawn/plantings.  Property taxes, however, are higher than what you’ll find in Bergen County.  I’d say that property taxes will cost you about $275 more per month than a similar sized townhouse in Bergen County.  However the sales price will be roughly half.

Let’s figure this on a mortgage.  If a similar Bergen County townhouse will cost at least $750-800,000 that’s about $1,500 more per month.  This is why it’s such a deal.  You save at least $1,225 per month or $240,000 in mortgage dollars.

Convenient Location

Crown View is literally across the street from Eagle Rock Nature Preserve.  It’s a 5 minute drive to shopping malls where you’ll find everything you need from a CVS to Whole Foods.  West Orange has free jitney service to a short train commute to Penn Station.  There is also an express commuting bus to NYC that stops by the front gate.  Newark Liberty Airport is 25 minutes away by car.  Want to shop till you drop?  The upscale Short Hills Mall is 20 minutes away.  The Lincoln Tunnel to NYC is 35 minutes away.

West Orange Townhouses

I love Bergen County but sometimes it’s important and better for my clients to show them opportunities elsewhere.  Cwest orange townhouseslick this link to take a look at my listing at 1091 Smith Manor Road.  This Crown View townhouse has a fireplace in the Master Bedroom and a built in wet bar in the family room.  It wasn’t updated but I’m sure you’ll agree it’s very pretty.

There are other gated townhouse communities nearby.  Consider them.  The value is terrific and the location is ideal.  West Orange townhouses are a great deal for many consumers.  If you’d like to see some of these townhomes, just get in touch with me.

Posted by & filed under Renting.

tenant screeningWhy Tenant Screening Is Important

Tenant screening is the critical component of a positive rental experience for landlords.  Both experienced and new landlords make mistakes with this every day.

The result is a negative experience that can often end up in court.  If you own an investment property you must screen potential tenants carefully.  Consider this – you are allowing a stranger to use your property.  You want that property cared for appropriately as much as you want rent checks on time.

You also want to be fair to prospective tenants.  While every landlord has legitimate concerns about a tenant, it’s also important to be clear about your expectations and requirements.

Renting in Bergen County

This can sound very self serving but it makes no sense whatsoever to not hire a Realtor if you’re a residential landlord.  Why?  Because in Bergen County tenants pay the broker fee.  As a result, landlords can list a residential property for rent, have the broker do all of the work and it costs them nothing.

So I ask you, why wouldn’t you hire a real estate agent to list your property for rent?  It makes no sense to me at all.  But it’s your choice.  You can still do it on your own.  However, whether you use an agent or not, all NJ State and Federal laws and regulations still apply.

New Jersey limits rental security to no more than 1.5 month’s rent.  The most a landlord can ask for a security deposit, for example, on a $1000 per month rental is $1,500.  I am often asked about pet security.  That’s fine as long as the total security amount does not exceed 1.5 month’s rent.

Security deposits are subject to strict NJ regulations and must be deposited in a separate bank account for this purpose by the landlord.  Tenants must receive that security back (with applicable interest) within 30 days of the lease expiration assuming no damage to the property has occurred.

Your Listing For Rent

Mistakes start with your listing.  This sets the tone and your expectations.  What you want and don’t want should be clearly spelled out so there tenant screeningare no mistakes.  This is in many ways your initial tenant screening.  Allow me to explain:

Do you or don’t you allow smoking?  Do you or don’t you allow pets? What about renter’s insurance?  What about utilities?  If you have a 2 family that’s a top and bottom, do you want the 2nd floor folks to have area rugs on wood floors so the tenant below has a quiet environment?  What about parking?  Where and how many spaces?  Is on street overnight parking allowed?

Here’s an example to consider:  A tenant has 4 cars.  The listing specifies 2 outdoor parking spaces.  The tenant moves in and is ticketed every night because the town doesn’t allow overnight street parking for the other 2 cars.  Nothing was in the listing to tell a tenant that there’s no overnight street parking.

Be specific in the listing about things and you’ll avoid trouble for both you and prospective tenants.  The example above would not end well for both tenant and landlord.

By the way, if your so called professional agent tells you they can’t possibly get a tenant with all of this in the listing, fire the agent and find a professional who knows what to do.

Background Screening Is a Must

tenant screeningMost landlords get a basic credit report and a filled out tenant application form.  This is never good enough.  Require a background check too because that tells you if they’ve had bankruptcies, a criminal record, are classified as a sexual predator etc.  Do your due diligence.

While a completed tenant application form is nice to have, it’s just a piece of paper if no one calls to verify what’s on it.  Make sure your agent does that.  Your agent should report back to you that he/she has verified things like employment and previous landlord experience.

I always tell people what I know is true – nothing in life is guaranteed or perfect.  However, setting your expectations and parameters clearly in your listing and doing your due diligence gives you the best opportunity to get a great tenant.  Proper tenant screening involves more than you might think but it is the road to a great tenant.

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home stagingHome Staging Starts With Front Doors

Home staging starts with front doors.  Homeowners think about the interior when they stage a home for sale.  While interiors are important so are exteriors.  How a home presents at the first view is critical.  This sets the tone of a buyer’s expectations.  Think about it.  Would you be enthusiastic about a home that’s drab on the outside?  We call this curb appeal and it can make you or break you.

Why It Works

Let’s say you are out looking at homes on a Sunday.  You’re going from open house to open house and it’s getting close to 4 pm when most end.  You drive up to a home, look at it from the car and go on to the next because it has no appeal.  There is nothing about it that makes you want to go inside when the time is tight.  You’ll do this when there’s plenty of time to look too.  Buyers will often say to their agent “Let’s pass on this one.” if the exterior isn’t appealing.

This happens a lot; more often than you’d think.  I know because I am constantly either showing homes or looking at them.  Seller’s believe they should wait until May to put their homes on the market.  Why?  Because flowers are blooming, the grass is green and the trees have their leaves back.  It looks better outside so they wait.

Waiting Till May Is Often A Mistake

home staging

Waiting till May is often a mistake because people who want to move in July are already in contract on a home.  Buyers know that they must move into their new home by early to mid August if they have children.  Moving later means that their children might not start school on time.  It can take 2 weeks to get children registered for school and some aren’t open the last week in August.

Back this up 45 days.  That’s how long the process takes after you’re through Attorney Review.  Attorney Review can take 7-10 days.  So now we’re closing in on 2 months time.  That takes you back to early June.  Buyers need to have their offer accepted by early June to be sure they move in by mid August.

It takes a while to look for a home and find it.  If you want to move in July, you are looking in February and March with offers made in April.  Waiting until May puts your home on the market at the tail end of the market.  There are still way more closings in July than in August so waiting till May is almost always a mistake.  Staging a home doesn’t have to wait.

 

How To Win

home staging

Stage your exterior so you catch most of the buyers.  Don’t wait till May.  Home staging starts at the front door.  You’ll be amazed at what a coat of fresh paint can do.  Polishing door knobs does wonders too.  Plant winter cabbage to add color and warmth then get your home on the market in early to mid March.  Don’t miss your opportunity to be seen by the majority of spring home buyers.

This is a win win.  You’re giving buyers another home to look at while you’re open to the greatest number of them.  What could be better?  The bottom line is that curb appeal counts tremendously.  You can have great curb appeal any time of year if you know what to do.  Need help?  Just call me at 201-741-8490.

Posted by & filed under Buying, Selling.

Berbergen county homesgen County Homes For Sale

Bergen County homes for sale is something I track as well as Bergen County closings.  It’s important to look at both as well as homes going under contract.   Timing is important too.

House sales for the first quarter of any year tell us more about the year before than anything else.  While everyone wants to know what’s sold, sales then come from contracts written months ago last year.  We want sold homes to show us this year’s real estate trends.  They can’t until we get to mid year.

March 1st had 1,993 homes for sale in the New Jersey MLS.  You’d expect a normal year to have at least 2,500 if not more.  2018 seems to be repeating 2017 because the number of active listings since January 1st is quite similar.  2018 has 3,170 while 2017 had 3,102 for a 2% increase.

It’s only been over the past 2 weeks that homes have begun to come on the market at a good rate.  This year has truly started slowly.  Projections showed that we’d start quietly and they were right.  Inventory is slowly building as the pace of homes coming on the market is accelerating.  The bottom line appears to be that 2018 is another year of low inventory but slightly better than 2017.

Bergen County County Homes Under Contract

While looking at sales now makes no sense it does make sense to look at under contract figures.  If you’ve been reading my blog articles then you know why.

Under contract homes show the strength and pace of the market.  The status of a home changes to under contract once Attorney Review is completed.  Although UC home sales can fall apart, they’re not volatile enough to be irrelevant.  They are current too.  Think about it.

A home usually is reported as under contract 2-3 weeks after an offer is accepted.  Sales are reported 2-3 months later.  I analyze sales by looking back to see when they went under contract.  Sometimes it’s so far back that it’s too old to be statistically significant.

992 homes went under contract last year while we have 1,043 this year for a 5% increase.  Look at how this plays out.  We have over double the number of homes under contract than are coming on the market.  This tells us a lot.  Demand is up and buyers are taking action.  They are getting off the fence.

The Bottom Line

The question is Why?  The answer is because of rate hikes, prices going up and the tax reform bill.  Jeff Otteau said that as we get closer to April people will better understand that the tax reform is a win for everyone.  Even people who can’t write off as much will win because tax reform is revitalizing the economy and bringing jobs back to the US.

Please understand that this was not a political statement.  It was his unbiased analysis of the tax reform bill.  He felt that the public has bbergen county homeseen misinformed by the media and the Administration’s opposition because they don’t understand it or have other agendas.  Because of this buyers would be wary early on and the market would stall in the early part of the year.  Read my January article on this written after I attended his tax seminar.

The bottom line for 2018 is that we are coming out of an expected stall in the market and are on our way to a more robust real estate market.  Bergen County homes are going to have another good year while inventory remains a challenge for home buyers.

You can search the inventory directly from the MLS through my website to see what’s out there.  If you have any questions, want to chat or make an appointment, just call or text me at 201-741-8490.  Comments are welcome too!

Posted by & filed under Buying, Homeowner Tips.

tax appealHow To Do A Tax Appeal

It’s tax appeal season.  How to do a tax appeal is what this article is about so let’s begin.

Every year from January 1st through March 31st Bergen County property owners can file an appeal of their property tax assessment.  You can only appeal the assessment; you can’t appeal the property tax.

Property taxes are calculated by multiplying the assessment by the tax rate.  It’s the assessment that a tax assessor gives a home which really counts.  Tax rates change every year.  Assessments stay the same for several years.

Understanding Assessments

Assessments change on a home for usually 3 reasons:

  1. A town wide re-assessment
  2. Improvements
  3. Tax appeal

When tax assessments get out of whack with market values, a town will do a revaluation of all property.  This is expensive so it doesn’t happen often.  Improvements raise assessments because the house is worth more with, for example, a new kitchen.  Successful tax appeals lower assessments.  As a result, an owner’s path to lower property taxes is by successfully appealing their home’s assessment.

Tax assessors try to make everyone’s tax burden fair when they assess a home.  They look at what homes are selling for and know the market well.  Towns hire companies to do town wide revaluations.  Assessors try to get inside every home but not all owners cooperate.  This can backfire because you can be over assessed.  Remember that if an assessor does not get inside assumptions are made that can hurt you.

The Rule of Thumb

The rule of thumb is you must prove that your current assessment should be reduced by 15% or more.  The burden of proof is on you; not on the tax assessor.  You need at least 3 but no more than 5 comparable sales which closed before October 1st of the prior year.  Appeals are filed with the Bergen County Board of Taxation in Hackensack.

The Bergen County Board of Taxation will mail you the required petition of appeal form.  You can complete it and mail it in or deliver it directly to their Hackensack location.  Email and faxing isn’t allowed.  You must also give your local tax assessor a copy.  Here’s a tip:  Cal them at 201-336-6300 if their site is overwhelmed and not responding.

Comparable sales should be near your property, have similar lot and structure size, age, style and condition.  It’s also a good idea to take pictures of your property and comparables used.  It’s essential that you know every property intimately well so you can present a detailed presentation and a suggested new value based on the evidence you cite.

While not impossible to do yourself, this is an involved process done at a public hearing.  Everything you need to know is on the Bergen County Board of Taxation website  You can also hire an attorney who specializes in tax appeals.

It’s tax appeal season and it ends on April 1st.  Do your hotax appealmework.  You must be able to prove that your assessed value should be 85% or less than it is now.  Good luck!

NOTE:   I wrote this article 3 years ago.  I’ve received several calls lately on tax appeals so it seemed right to update and re-publish it.

Posted by & filed under Buying, Selling.

a crown view townhouseA Crown View Townhouse

A Crown View townhouse is back on the market.  I just re-listed 1091 Smith Manor Blvd at Crown View in West Orange NJ.  This is a 3 bedroom 2.5 bath stand alone townhome with some nice custom touches.

The kitchen has a center island, the family room has a built in wet bar, the Master Bedroom has a gas fireplace and the 3rd bedroom closet has been turned into a home office carroll.

The Crown View Community

Crown View is a very unique condominium complex.  There is both an 8 story condo apartment building (179 units) and individual stand alone luxury townhomes (100 units).  It cradles a lake with walking/jogging trails alongside as well as having tennis courts and an outdoor pool.  There is a decidedly warm community feeling and the complex is pet friendly.  Access is by a 24/7 Concierge at it’s gated entry for this upscale condominium.

There’s a bit of history here too because it’s built on part of what was the Orange Quarry where bluestone was mined. a crown view townhouse The townhomes here are all stand alone so it’s really like having your own house with concierge services.  Exterior maintenance takes care of all grounds and snow removal includes shoveling your front steps and walk.

West Orange Values

Bergen County residents will be surprised to find that this townhouse is half or less of what it would cost there.  Property taxes are higher but that doesn’t make up for the cost difference.  I used to travel to West Orange in the 80’s and 90’s watching all of the condominium development that was going on then.  When I have buyers who want a townhouse but can’t afford northern New Jersey pricing, I take them for a ride here.

Taxes are higher in Essex County but prices are lower.  Because of this, values are better.  I sold this townhouse to the present owner while we were looking in Bergen County.  Explaining that their money would go further, we checked out the many developments off of Prospect Avenue.  There are several and some are gated communities like this one.  They were amazed at the difference.

The cost of a similar townhome in Bergen County at the time was nearly double.  Mortgage costs would have been $300,000 more or around $1,500 per month.  Taxes came to $300 more per month in West Orange.  This was a no brainer.

a crown view townhouseMoving On

My buyers worked in Madison and Rochelle Park.  Highway systems in New Jersey are so great that the commute to work for both was good.  As a result, they opted to buy at Crown View.   I am allowed to disclose that the only reason they are leaving is because one of them is now working in Philadelphia.  That’s not an easy commute.

Because of this a Crown View townhouse is back on the market.  Pricing is at $419,000.  Call me at 201-741-8490 if you’d like to take a look.  This is a great complex and a terrific townhome.  I love living in Bergen County because it has so much to offer.  It is sometimes better for you elsewhere.  I know how to guide you to where it’s best for you.  Get in touch with me when you’re ready.