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Nationally, sales of existing homes slid for most of the year but remained historically strong,
due in part to slightly falling interest rates. The National Association of Realtors forecasts 5
million units for the second time historically with sales to be greater than 5 million. As of
November 2000, sales of existing home resales advances at a 4.4% rate.
Absorption times of new developments in Nassau & Suffolk has been less than 12 months.
One developer reports that on a potential new project in Suffolk, 196+/- units over 600 names
for prospective purchasers has been received with just a sign on the property.
For the Year 2001 the major focus will be on Fed moves and the stock market with lower
interest rates and an improving market, these will be positive signs.
REAL ESTATE TAXES
On Long Island, the school tax is funded by real estate taxes. The school tax has gone up year
by year for almost the last 30 years even though GPD growth and inflation have fallen. For
example, one school district budget rose 9.86% while the CPI was 2.2%. Many other school
districts had double digit increases in the budget. It is an issue that needs to be addressed.
Brookhaven lost the Shoreham Tax case in that the Judge ruled $650 million must be paid out
of taxes not rate increases.
Nassau County is in the process of reassessment with the final assessments to go into effect
in 2003. No interior inspections of those properties will be made. Will taxes go up? No, the
overall amount of taxes won't be affected since that can only occur based upon the proposed
County budget. How the tax burden will be apportioned will be affected by a re-assessment.
It is estimated that 1/3 of the properties will see an increased assessment, 1/3 will see a
decreased assessment and 1/3 of the assessments will be unchanged. When the new
assessments are implemented in 2003, it will make for contentious and litigation oriented
situations. Long Island has one of the highest real property taxes in the nation.
Concerning Nassau's other problems, NAIFA has approved, in theory, a four year plan which
does have real estate tax increases about 3%-5% per year. But this could change.
Another problem is that Nassau has to pay back the school portion of any refund resulting from
a tax certiorari case. This stems from a 1948 legislative act. This issue was not addressed
as part of the reassessment program and will ultimately affect Nassau County down the road.
This legislative act must be repealed but it is politically unpopular.
Suffolk has real estate tax increases slated.
In New York City a different story. In a June 24
th
, 1999 memo from Steven Spinola of the Real
Estate Board of New York points out that NYC assessment practices will change. He says,
" We have received the attached internal Department of Finance memorandum that instructs
