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V.I. Real Estate Market Continues Subdued Recovery  

 

Alana33
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STTsailor
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September 13, 2016 1:34 pm  

<>

What is Real estate comission?
I thought stamp tax is a fee collected at the time of transaction. How could there be a discrepancy?


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Gator's Mom
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September 13, 2016 2:42 pm  

<>

What is Real estate comission?
I thought stamp tax is a fee collected at the time of transaction. How could there be a discrepancy?

A real estate commission is a group of people appointed by the governor to oversee the real estate business in the VI.

This time not a fee - deep breath.


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Alana33
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September 13, 2016 4:02 pm  

The problem with the stamp tax fees occurs when the property sells for less than the appraised value on the the property tax bill. They charge the tax on higher amount, not the actual sale amount.

"The problem is that these days the assessed value can be considerably higher than the market value. She said she recently sold a property for $410,000, but the stamp tax was applied to the assessed value, $795,000."

That's an unwanted and unexpected surprise and burden for the seller (and the buyer if they've agreed, contractually, to split and/or pay stamp tax costs).


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Gator's Mom
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September 13, 2016 4:36 pm  

The problem with the stamp tax fees occurs when the property sells for less than the appraised value on the the property tax bill. They charge the tax on higher amount, not the actual sale amount.

"The problem is that these days the assessed value can be considerably higher than the market value. She said she recently sold a property for $410,000, but the stamp tax was applied to the assessed value, $795,000."

That's an unwanted and unexpected surprise and burden for the seller (and the buyer if they've agreed, contractually, to split and/or pay stamp tax costs).

You can find the VI appraisal value online prior to the sale and factor that in to the transaction negotiation. Doesn't need to be a surprise.


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islandjoan
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September 13, 2016 4:46 pm  

Where do you find the VI appraisal value online?

You can find the VI appraisal value online prior to the sale and factor that in to the transaction negotiation. Doesn't need to be a surprise.


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Gator's Mom
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September 13, 2016 4:56 pm  

Where do you find the VI appraisal value online?

You can find the VI appraisal value online prior to the sale and factor that in to the transaction negotiation. Doesn't need to be a surprise.

https://propertytax.vi.gov/Lookup/ParcelLookup.aspx


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STTsailor
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September 13, 2016 5:29 pm  

I have never dealt with RE where county tax appraised value was HIGHER than market value. If that is the case then one could petition to lower the taxable value.


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Alana33
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September 13, 2016 5:54 pm  

The appraised value is right on your property tax bill.

What's been happening is they now go with the higher value for the stamp tax duty. If you sell your home/property for more than the value listed on your property tax bill, you pay the percentage on that higher amount. However, if your home sells for less than the appraised value on your bill, you pay that higher percentage according to what is listed on property tax bill, regardless of sale price.

It used to be that one only paid the duty on the actual amount the home or property sold for.

You do have the right to request a revaluation but it has to be requested and finalized, prior to the sale or closing or you now pay the higher amount. Not fair, IMO.


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IslandHops
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September 13, 2016 6:35 pm  

It is not uncommon in recent years for the sales price to be below the assessed value. You can petition the property tax division however it is unlikely that the assessed amount will be reduced regardless of the sales price.


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Alana33
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September 13, 2016 7:27 pm  

Actually, before the last round of revaluations by the Tax Accessor's Office were done, it was rare that the assessed value on the property tax bills were a factor because they were generally lower than what the government assessed the property for and as mentioned, earlier, you just paid the tax based on sale price, regardless.

The tax assessor's office has their own new formula created for them by a stateside company. They do not use any local RE comps nor local realtor input. Some of the assessments I've seen are way out of line for what a property can actually be sold for.

I've successfully petitioned a few times in the past for a revaluation which has lowered my property tax bills.

Bottom line is they shouldn't be charging people a tax based on an imaginary amount but just what a property sells for.


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Exit Zero
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islandjoan
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September 14, 2016 2:03 pm  

You can find your own appraised value on your property tax bill, and you can find the last appraised value of other properties on the link provided by Gator's Mom.

However, to find the CURRENT appraised value of a property you want to buy, is not so easy.

The lt. governor's website shows the last appraised value, but sometimes that appraisal value is several years old. It is usually not the current appraised value.

Because appraisal values constantly change based on comparable sales, and only realtors have access to this information.


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Alana33
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September 14, 2016 4:16 pm  

True but when you are purchasing a property with financing through a bank, they order an appraisal to be done for which you pay.
If you're paying cash, it's wise to order your own appraisal and have a home inspection.

Realtor's comps can only tell you so much.


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islandjoan
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September 14, 2016 4:43 pm  

Alana, that is true, I paid for an appraisal when I purchased a condo.

From what I understand, appraisers usually use comps as one of the main criteria for determining their appraisal.


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Alana33
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September 14, 2016 5:21 pm  

Yes, they use comps on recently sold, similar properties but there's much more to the appraisal than just the comps tho the comps are important.
There are very few appraisers (STT, anyway) so there's a very high probability that your assigned or chosen appraiser has previously appraised the comps he/she will be using on subject property and may have previously appraised the subject property in the past.


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STTsailor
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September 14, 2016 7:14 pm  

Unfortunately apresals are fairly bogus here as the pool of comps is very small. Also apresers always want to know the sale price and arrive at the number within 1% of the contracted price.

This leads me to belive the buyer and seller know best. Don't they?


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Alana33
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September 14, 2016 8:50 pm  

Not true.
Not always.
Deals have gone sideways due to an appraisal coming in below the selling price. Been there


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caribstx
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September 15, 2016 11:29 am  

Appraisers determine the value that the bank who holds the mortgage wants it to be. When my Scotia balloon mortgage expired during the STX post-Hovensa downturn, I was amazed that the appraisal put my home's value much higher that when I bought it. When I mentioned this to the mortgage officer, she just winked.


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