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Two-Hatchet 03-19-2012 09:06 PM

How can I purposely lower the value of a new construction build?
Here's the background to my unusual question - I bought some rural wooded property a number of years back and as I'm approaching retirement this is where I'll be spending my golden years. Over the last 5 years I've been slowly clearing the property and I've pulled out a small mountain of very colorful fieldstones.

Now that I'm preparing to build a house, and do it as cheaply as I can because with retirement my income is going to drop and I want to minimize all of my expenses, including taxes plus home maintenance, I've talked to local building officials about my plans. HUGE surprise for me. The fact that I'm intending to clad the home with stone means that I'm going to be building with a very expensive material, according to the Marshall and Swift database , which I dug up for FREE on my own property, and accordingly the value of my construction will increase as will my annual property taxes.

Here I am setting out to use free material and I'm going to have to pay more for a permit and then forever after with property taxes. This does not sit well with me.

My intent is to now use this asinine policy to my benefit, hence my question, how can I purposely set out to lower the declared and assessed value of my home during the construction phase in such a way that I can easily undo all the low value features at my leisure, for I never again intend to grant a government bureaucrat the power to tell me what I can build within my own home. There is no bank financing involved, so I have free reign to do as I please.

My first thought was to simply reject having any cabinets in the home. Declare that I'm setting out to achieve "rustic shack minimalism" as the design aesthetic and that requires rough hewn planks for countertops. After this though I'm running into a blank wall for ideas. Will a subfloor pass as a flooring surface? What else can I do? There is quite a range in home valuation between the skeleton of a home and the finished high end product seen in some homes, so for tax and assessment purposes, where is that value difference found? I'm assuming finishes are the principal component. Is that correct?

oh'mike 03-19-2012 09:29 PM

Find out what criteria the assessors use---skylights are taxed--fireplaces--chimneys ---concrete drive ways----see what rings the register--

jaydevries 03-19-2012 09:34 PM

just suggestions but how about leaving closets out except one so it makes it a 1 bedroom , also only finish one bathroom and make the rest for future use. i have seen a million dollar home with just one floor done to save on taxes in Colorado

cleveman 03-19-2012 09:44 PM

Put it on wheels and license it.

Two-Hatchet 03-19-2012 09:44 PM


Originally Posted by jaydevries (Post 881096)
just suggestions but how about leaving closets out except one so it makes it a 1 bedroom , also only finish one bathroom and make the rest for future use. i have seen a million dollar home with just one floor done to save on taxes in Colorado

How about a sink and toilet in one bathroom and then just a tub in another bathroom. Kind of a Japanese bath aesthetic. How attractive are homes with a separate tub room?

Hardway 03-19-2012 11:20 PM

Nice try thou, it won't work. We tried to beat the taxes by building in expensive. It just won't work they will burn ya anany way ya go. The taxes go up every year. Was at one time if you built a berm house, or under ground. Not sure if that will fly any more. Tax the working man and the retired. We have a kitchen sink, outdoor shower and an outhouse. The outhouse is taxed as an out building.

Tom Struble 03-19-2012 11:29 PM

you want it you gotta pay:(

Bondo 03-20-2012 05:22 AM


Declare that I'm setting out to achieve "rustic shack minimalism" as the design
Ayuh,.... Put in Just a woodstove, 'n No Hvac....

gregzoll 03-20-2012 07:07 AM

Haul in a bunch of junk cars.

joed 03-20-2012 07:36 AM

Do not finish the second floor. Do not install the staircase to the second floor. It is only and attic. Do not finish the basement.

KarlJay 03-20-2012 07:51 AM

I'm in the other position, I'm trying to get my value up in order to sell high and get out. I asked for a loan years ago on my paid off house.

I noticed a few things:
Bedrooms are MUCH more valuable than regular rooms, so I lost the washroom and dining room. in favor of 2 new bedrooms.

Sq Footage is the multiplier, so I'd set it up so that you have 'non living' space that can be used as living space or usable space. Example is a porche or area that can be used as a deck later, or something that can be covered and used later.

Example: a 'U' shaped house with an open area in the center area, then later cover with a pergula or some other kinda of cover. Usable space, not taxed as 'living' space.

Don't have central HVAC, use wood stove(s) or space heaters.

Go with 1 larger room rather than 3 rooms, make the rooms so that you can divide them later. I'm going with two side by side rooms with 1 single wall between. I don't need 3 rooms, I'll finish the wall before it goes on the market.

Example: 1 200 sq ft room is worth less that 2 100 sq ft rooms...

I don't know the definition of 1/2 bath, but make 1 and 1/2 bath, but the 1/2 bath is large enough for a full bath later.

Design the layout so that you can make changes that can't be detected from the outside or are non-structural. Design into the plumbing, taps for changes / add-ons. Have the roof extend over the porch as far as you can, then later make the porche a 3 season porche.

I'm not sure about your laws, but around here (California with Prop 13) we've had a BUNCH of old houses where everything was removed except the frame, it was redesigned completely, using only the original outside frame. This I understand made that taxes remain the same, but the house looked and functioned as new.

Find out exactly what requires a permit in your area. Can you reside the house with those stones without a permit?

Find out what actually triggers a re-assessment. Example, can you put up cheap roofing and then re-roof over that without a re-assessment? Are re-assessments timed, or triggered, do they go inside the home?

framer52 03-20-2012 08:11 AM

What state do you live in?

Assessment qualifications are state specific.

hyunelan2 03-20-2012 08:57 AM

I have some distant relatives that bought property in one of those "hilly states" that fight the tax man in the following way. I guess it's pretty common 'down there' to park a mobile home on the property, and then build on a ton of additions to it. Since they are all part of the mobile home (even though they stand on their own), none of them count as a permanent structure and the taxes don't go up. Somewhere along the line I would expect that loophole to be closed, but it's so prevalent it will probably be a pretty big fight.

Hardway 03-20-2012 10:11 AM


Originally Posted by Bondo (Post 881239)
Ayuh,.... Put in Just a woodstove, 'n No Hvac....

nice try, we had just a woodstove and the taxes were still high.

Two-Hatchet 03-20-2012 05:34 PM

Thanks everyone, your suggestions are very helpful and they've helped me overcome my own lack of imagination. I just checked with local officials and found out that so long as the attic has no stairs leading up to it it is considered non-living space and it not taxed annually and it is not taxed in the permit process. Also, the use of a wood stove as the sole heating unit is permitted and it significantly lowers the assessed value of the home for property tax purposes in that in the real estate market homes with only wood heating suffer a valuation penalty.

It shouldn't be too difficult for me to have the house designed as I want it and then overlay a "rustic minimalist" design which strips out all the high value features and submit that for the approval process. After being granted a certificate of occupancy, I'll continue the work to bring the house up to my standards.

As to the room issue, I still need to do more investigating on that for the assessment officials couldn't spare any more time on my questions.

The rock facing question does require a permit because the building inspector has to verify that the construction is done properly, which means that I can't add this feature after the fact for it would be immediately visible from public spaces like the road, aerial photos and satellite photos.

I do like the junk cars idea - that's quite original - but I'll have to pass on it :) for even though this is a fight of principle for me I think that the headache attached to that tactic might be too much for me to bear.

The mobile home idea is something I never would have thought of. I need to mull that over a bit.

Please keep the ideas coming.

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