Realtors rally for big tax change
Well-to-do buyers are walking away from real estate deals because recent changes to the tax structure in the South Carolina have caused tax bills to jump sky-high when a piece of property changes hands, according to the South Carolina Association of Realtors. Just when a revived real estate market could help return the Palmetto State’s economy to health, Realtors say the 2006 passage of point-of-sale tax reassessment is strangling their already beleaguered industry.
“We need the real estate industry to help lead us out of this funk – depression, recession, whatever you call it,” said Meybohm Realtors broker Ron Pope. “In reality, what we’ve done in South Carolina is kick the real estate industry square in the stomach when it’s already down.”
Pope chairs the legislative affairs committee for the Aiken Board of Realtors, a group composed of agents and brokers from around the area.
Dozens of Aiken County Realtors plan to join colleagues from around South Carolina Tuesday on the State House steps where they will make their case for the changes to the law in the waning days of the legislative session this week. The Senate is expected to debate a measure this week that would eliminate the point of sale practice.
On the other side of the issue, city and county governments around the state have slashed their budgets as they face the worst economy in decades. Without new properties being developed, they argue the only avenue for growth in the tax base is to tax recently sold properties at their actual value instead of the artificially lower value imposed by a 15 percent cap on value increases for existing homeowners.
South Carolina voters approved both measures – the 15 percent cap in value increases every five years for existing homeowners and the removal of that cap when a sale takes place – in the same 2006 referendum. This week, the Realtors hope the S.C. Senate will take up a measure that would keep the cap in place and extend it to new buyers as well for up to five years. Any subsequent assessment would also be limited by the 15 percent cap, even for recent buyers.
Realtors say the change is necessary to get sales going again. Taxing authorities and opponents say it is having your cake and eating it too by allowing high-end real estate buyers to pay taxes on a lower percentage of the value than those who own more modest properties that have not seen an increase in value.
Pope and Kristyne Blake, association executive for the Aiken Board of Realtors, met with the Aiken Standard Friday to discuss the issue, saying they do realize local government is struggling and that an overhaul of the whole taxation system is probably warranted. However, real estate sales is their primary focus and the reason they’ll be in Columbia on Tuesday and ask senators to pass the proposal before them.
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How will SRS funds power up our economy?
J. David Jameson, president and CEO of the Greater Aiken Chamber of Commerce, joked that when the stimulus money came, he would don a Paul Revere outfit, borrow a horse and ride through Aiken shouting, “The recession is over! The recession is over!”
While he has yet to come through on his colonial contract, Jameson does see the money having direct impact in the very near future.
“I do think that this is a turning point for this community. Every business won’t be affected in the same way, but lots of businesses will be affected,” he said.
Jameson said that although Aiken has not been hammered as brutally as some other parts of the country, the infusion will certainly be beneficial.
“I think that this will be a great cushion to our current economic condition. With a new $1.6 billion being spent here in the next 30 months, some good percentage of it will stick within our community,” he said.
He said that whether the jobs are filled with people currently in Aiken or people moving here, it will have clearly measurable impact.
“It will have impact on this community because it will create new spending,” he said.
Jameson cautioned that the optimism should not be unbridled and that there still needed to be an eye toward fiscal responsibility with business owners willing to take risks, albeit calculated ones.
“I don’t think they can anticipate that this is the start of something that will be here for ever and ever, because that would be incorrect. But it may be that the national economy catches up with where our economy is going to be,” he said.
THE REAL ESTATE MARKET
Kristyne Blake, association executive for the Aiken Board of Realtors, is encouraged by the news of the stimulus funds. Ideally, she said, many of the new jobs would go to people already in Aiken, which could lead to home upgrades. New, long-term positions filled by people moving into the area would also benefit the housing market, while short-term contract labor could benefit rental properties. Blake said the Aiken market has fared better than most since the downturn, with home prices dropping a mere 3.9 percent, compared to the 10 percent drop statewide.
“Aiken did see an increase during the housing boom, of course, but our housing prices have not plummeted,” she said.
She also hoped the news would lead more first-time buyers to start shopping, in particular in light of the new $8,000 federal tax credit available for first time buyers.
“That’s a wonderful program,” she said.
Blake added that the sense of recovery has been building of late, and this latest news only helps.
“In the last couple of months, there is a sense of optimism that it is getting better,” she said. Full Story.
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Habitat completes 73rd Aiken home!
Shameco Butler had cut the ribbon to her new Habitat for Humanity home Last Sunday.
She had formally received the keys to the residence in the Kennedy Kolony area of Aiken and had accepted a Bible as a gift.
It was her turn to speak to a cheering crowd of family, friends and volunteers, but Butler was immediately overcome by tears. She could only express her gratitude to Habitat, the sponsoring Aiken Board of Realtors, the Realtor Habitat Committee chair, Lyvia May, Kay and Joe Buggy and St. Thaddeus Episcopal Church.
A few minutes later, Butler would describe how she had become so worried about the neighborhood where she had once lived with her three young children – Dystiny Lawrence, 9, Dashawna Hicks, 8, and Shawn Hicks, 6. She moved in with family members and dreamed about her own home. She applied for Habitat and was accepted. Full Story.
Front Gate Properties, We’re selling the BEST Real Estate in Aiken, SC.