Providence's Finance Committee Votes in Favor of Tax Hike

Even Higher Rate Increase for Small Landlords

On July 14^th, the Providence City Council's Finance Committee voted to increase the property tax rates for residential and commercial property and eliminate the homestead exemption for owners of 1 – 5 non-owner occupied properties, (July 16^th  and July 20^th articles in the Providence Journal).  The full City Council will vote on July 26^th.

Details of the Proposed Increases:

25.5% increase in residential property tax rate: The residential property tax rate would increase from $24.21 per $1,000 of assessed value to $30.38.

Additional 33% rate hike for small landlords:  The Council will vote to repeal a homestead exemption for non-owner occupied rental properties of 1 – 5 units.  If approved, this will result in an additional 33% increase in the property tax rate for owners of these properties. This will mean a grand total of a 58.5% tax increase for some landlords.

17.8% increase in commercial property tax rate:   The commercial property tax rate would  raise the commercial rate from $28.60 per $1,000 of value to $33.70

When will these increases take effect?   Immediately? Retroactively? Property owners will receive revised tax bills in August, (July 16^th Providence Journal). 

Choosing a Smaller House Doesn't Always Mean You are an Empty Nester.

I was interviewed last week by Cheryl Phillips, Real Estate Contributor to GoLocalProv.com on the growing trend in buyers looking for smaller homes, regardless of how many people are living there.

"…Downsizing isn't just for empty nesters anymore. More people, including first time homebuyers, are moving into smaller homes and learning how to live with less. 

Just how much home space do you need? Can you live with fewer possessions? And what do you do with the stuff that takes up too much space?

These questions are important in a time when making a home buying decision is based on needs rather than wants…"

Click here for the rest of the article

RI Foreclosures are Up 55% From a Year Ago and Up 19% From March

One in every 525 households received a foreclosure notice in April, according to RealtyTrac.

The Irvine, Calif.-based real-estate tracking firm said 861 properties in Rhode Island, or one in every 525 homes, received a foreclosure notice last month. The state’s foreclosure rate ranked 19th-highest among the 50 states.

Nationally, RealtyTrac said one in every 387 homes received a notice in April, a drop of 2.4 percent from a year ago and down 9 percent from March 2010.

When you get down to individual state foreclosure statistics, what you really talking about is that state's economy.  We've seen the median price of a home in Rhode Island stabilize and even creep up a bit. We've seen the tax stimulus encourage people to get back into the real estate market. But now that that is over, it's going to be our local Rhode Island economy that provides the true heartbeat for our real estate market.  

While not known for their efforts to help existing homeowners, Rhode Island Housing is a winner of a 2009 Justice Award in the category of Consumer Protection. The awards are given in recognition of an extraordinary commitment to justice exhibited by members of the community.

“We are honored to have the work of our HelpCenter recognized by Attorney General Lynch,” says Richard Godfrey, Executive Director of Rhode Island Housing. “At the onset of this unprecedented housing crisis, other counseling agencies were simply overwhelmed. With our receipt of federal funding, Rhode Island Housing has seen over 5,000 Rhode Islanders walk through the doors of our HelpCenter. Some were victims of predatory lending, others of scams that followed offers to ‘save their homes.’ For others, it was the loss of jobs and the economic crisis that brought on their struggles. Many factors have come together to put Rhode Island homeowners in crisis.”

Adds Godfrey, “Our HelpCenter provides a safe place for advice and education when it comes to protecting both homeowners and tenants from foreclosure, or coping with the loss of a home. Here in Rhode Island, which is currently ranked 11th in the nation for foreclosure activity, distressed homeowners are at particularly high risk of predators.”

“By reaching people at the first sign of trouble, we can offer them more options,” says Godfrey. “To date, our efforts have not only kept many homeowners seeking assistance in their homes, we have prevented many more from falling prey to those offering false promises and steep fees for foreclosure assistance. Our efforts continue to help homeowners in trouble arm themselves with the tools and information they need to protect themselves against fraud, avoid housing trouble, or find a safe solution to their situation that best meets their needs.”

Scituate and Glocester, Rhode Island have made Money magazine’s annual list of the 100 best places to live in the United States.

The magazine’s editors ranked Scituate at 69th and nearby Glocester at 73rd.

The two neighboring Rhode Island towns in the northwestern part of the state have about 10,000 residents each. Both won praise for their good schools, while the state’s above-average unemployment rate was a mark against them.

Of Scituate, the magazine said:

“This former farming community has many homes on large plots of land – perfect for privacy-loving Yankees. Scituate works to maintain its forests and lakes to preserve the rural tranquility. The downtown is quaint, with a small country-style main street.”

As for Glocester, the editors said:

“Many of the historical relics in this town 30 miles from Providence thrive with a modern-day twist. An old stagecoach station has been converted into a popular restaurant, and some rural areas have become gentleman farms.”

North Providence is in bad financial shape.  To make up for deficits, they have approved a tax increase from $22.70 per 1000 to $25.60 per 1000.  This equals a 12.7% increase!  New tax bills are going out at the end of the month. There also may be another supplemental tax increase in January, which has not been approved yet, but more than likely will.  Total tax increase is supposed to be 17%.

Click here for current Rhode Island Municipal Tax Rates.

Barrington police have arrested an East Providence woman they say was stealing prescription drugs and jewelry from real estate open houses she attended.  Police have been looking for someone stealing items at open houses for months, but finally caught up to a suspect last weekend.

Police say 50-year-old Linda Grablink was arrested after a real estate agent confronted her with a bottle of pills in her hand at a home for sale.

Sgt. Josh Birrell says police went to Grablink’s home where they found maps of the area as well as lists of open houses.  Grablink is charged with three counts of larceny under $500 and one count of larceny over $500.

During open houses, it is imperative to put not only jewelry and money in a safe place, but prescription drugs as well.  Do not put them in a dresser drawer!  Use a place that is creative or simply take items with you for the time you are out of the house.

Capital Cove Condo Interior

Johnson & Wales announced that it has signed a three-year agreement with Capitol Cove LLC to lease 96 newly constructed luxury condominiums on Canal Street in Providence for use as student housing complete with granite   counter tops, stainless steel appliances and one of the best views in Providence.

When classes start this fall 300 students will live in upscale condos that had been languishing on the market.

Developer Robert Roth began marketing Capitol Cove condos last fall for $350,000 to $550,000, getting four reservations and no sales.

Students at Johnson & Wales will pay yearly rents of $10,383 for one-bedroom apartments and $9,249 to share a two-bedroom unit — comparable to dorm rates.  Roth said this deal would not come close to recouping the $30 million already invested by him and his bank.

On the downside, these students will miss out on bits of Americana that make the college housing experience a pivotal growing experience for a young man or woman.

Remember fellas, in your fraternity, when  flushing the toilet meant an instant 400 degree shower temperature?  How about that shared dorm bath where flip flops weren’t just a fashion statement, they were the only barrier between you and athletes foot?  And what sorority gal doesn’t fondly recall posting up for position in front of the bathroom mirror like Shaquille O’Neal in a hostile environment.  And just how many electronic devices can we jam into a non GFI water soaked power source?

Above – my sweet paneled room at URI complete with rotary phone.

The project has come under some scrutiny as members of the Providence City Council question whether Capitol Cove violated its tax-stabilization treaty with the city by using the building as a dormitory.