Deciding Whether to Buy or Build (Impact Fees)

Impact fees are taxes. They are a new kind of tax that many cash-strapped
cities are assessing on remodeling and new home construction. Depending on
where you live, they can be substantial.  You won't find 'impact fees' in
every city or county.
    
You'll find impact fees used in some cities in South Carolina, California,
Oregon, Florida, Colorado, Arizona and Washington.  Typically the fees are
assessed by cities to pay for new roads, parks, and sewer lines.
    
According to Duncan Associates, a Texas consulting firm that tracks them,
impact fees can add an average of $10,500 to the cost of a new home in cities
where they are imposed.  Of course, many cities have substantially smaller fees.
      
Property rights advocates are against the fees, saying local governments are
just afraid to go to taxpayers to ask for more money.  But proponents say the
taxes are fair because they are targeted at the very people who are causing
an impact on the city services: builders of new houses.

In any case, these fees are rarely assessed on the sale of an existing property
though the fees could raise the price of a property.
       
This is something to consider when pondering whether to build or buy.  You can
easily check to see if a locality assesses impact fees by checking with the city
building permits department.
       
If you have a question you want to ask, email me at info@miltonyates.com.

I will be glad to help.

Blessings to Your Real Estate Investing Successes,

Milton B. Yates
www.miltonyates.com