Property Tax Relief For Small Multifamily Property Owners

With unemployment at the highest it has been since the Great Depression, many American families are struggling to pay rent. Last month, a third of all renters failed to pay on time – a number that will likely increase as unemployment continues to rise.

In the Chicago area, evictions and foreclosures are banned during the shelter-in-place order. During this time, mom-and-pop building owners with 10 or fewer units are likely to be hardest hit, along with other small, multifamily properties and low-to-moderate income housing.

For Cook County’s small multifamily building landlords, it is a threat that makes the property tax assessment process even more important. Nearly half of Chicago residents are renters, according to the U.S. Census Bureau. Smaller building landlords face the prospect of a growing number of tenants struggling to pay their rent. For landlords who cater to Chicago area college students, the prospects may be even grimmer if the pandemic interrupts a return to campus in the fall.

Relief Efforts Are in the Works

Cook County Assessor Fritz Kaegi has announced plans to adjust property values based on “significant” changes in market value that can be attributed to the pandemic. And members of the Cook County Board of Review released a statement on May 7 regarding the COVID-19 adjustments, noting that:

 “While the Cook County assessor’s office recently announced its intention to reassess all county properties in light of the impact of the COVID-19 crisis, the reality is that the Board of Review already takes into account factors like vacancy and income generated by the property…”

But the fact remains, the only way to be sure you are not paying too much in property taxes is to appeal your assessment.

Recoup Some Losses with Tax Savings

In Cook County, property owners can request an appeal based on vacancies or changes in revenue for income-producing commercial apartments (class 300). Landlords can also claim vacancies due to natural disasters, such as a pandemic, along with:

• New Construction
• Initial Start-Up Occupancy
• Fire or Floods
• Construction or Completion Delay
• Environmental Remediation, and more

To file an appeal with the assessor’s office, landowners must provide income, expense, and vacancy information via the Real Property Income & Expense (RPIE) form. For owners of small multifamily commercial properties, weighing all appeal options – from lack of uniformity arguments to income and expense arguments – is critical for ensuring a fair assessment.

Understand Your Appeal Options

Regardless of whether your tenants are paying rent, property taxes will be due.

And a consideration of extenuating circumstances does not ensure that your assessment will be accurate.  A blanket adjustment in assessed value is also no guarantee that you are not paying too much since it does not take into account any anomalies in the underlying assessments of individual properties. An appeal is the only way to ensure that the circumstances unique to your property – and its assessment relative to similarly-situated properties – is taken into consideration.

For landlords, property taxes can represent nearly 20% of gross income. As a significant expense, property owners should ensure they aren’t overpaying on an incorrect assessed value.

You Could Be Overpaying Thousands of Dollars

The only way to be 100% confident that you are not paying more in property taxes than you should is to appeal your assessment.

At Kensington, we have deep expertise in identifying the most compelling arguments for your appeal. With zero up-front fees, the process is risk-free, and we only charge a small percentage of the first-year savings recouped if the appeal is successful.

Our commercial property tax appeal service has a strong history of successful appeals. We have helped over 12,000 residential and commercial property owners save millions of dollars in property taxes by successfully reducing their assessments.

Give us a call or click on the link below to learn more.

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