The Roanoker - September / October 2018 - 65

For these programs, the Office of Real
Estate Valuation for the City will be a key
player. They are responsible for appraising
properties at 100 percent of their market

For further information on these
and other incentive programs the
City offers, follow this path to the
relevant information.







Go to RoanokeVa.Gov.
Hover over Government.
Under Departments P-Z, select
Real Estate Valuation.
In the drop-down list on the left,
select Tax Relief and Incentive
Programs.
There are links to each program
discussed in this article, plus
more that are offered, which will
all contain detailed guidelines,
relevant links and applications.

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value each year, which is then used to
calculate the annual real estate tax bill.
Their appraisals are also used to calculate
the tax breaks offered for these renovation
incentives. W hen you apply for one of
these programs, (which includes a $50
application fee), the city will come out
and do an on-site inspection to determine
the value of a property before renovations.
Then they will come out again when you
are done to determine the value of the
property after the renovations. Of course,
all renovations need to done to meet
current city code.
I f yo u m e e t t h e g u i d e l i n e s o f t h e
incentive program, you get partial tax
relief by only paying real estate taxes on the
unimproved value, before renovations of
the property for a period of time. (Usually
five or 10 years depending on the areas
targeted for the incentives.)
Basic eligibility details for residential
properties include single family dwellings,
duplexes, multifamil y dwel lings and
townhouses. The structure must be at
least 40 years old, the assessed value must

be increased by at least 40 percent by the
renovations, and it must remain suitable for
residential use.
Let 's put some example numbers on
that. Buy an old house that needs work for
$50,000. Put $20,000 into it fixing it up.
End up with a house worth at least $70,000,
(or hopefully more) and you would qualify
for the tax break. You only pay real estate
taxes on $50,000 because you increased the
value by at least 40 percent. ($50,000 x 1.4 =
$70,000). If it is to be a rental, the tax break
can be added back into the cash flows, or if
it is to be sold, the tax break is transferable,
adding to the appeal for a buyer. There are
a few more details in regard to historic
properties and very low value properties
where it is better to demolish and start over.
For commercial properties, the program
operates the same way, with the eligibility
numbers being a bit different. The structure
needs to be at least 25 years old, and the
value needs to be increased by at least
60 percent. This might apply nicely to
neighborhood storefronts with a residential
apartment added upstairs. I

SEPTEMBER/OCTOBER 2018

65
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The Roanoker - September / October 2018

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