After these few days of discussion on goals of global corporate land grab with no property taxation and city/state debt tied to development and property all bound to the bond market-----deals of which required all city tax revenues be directed to these global corporate campus bond deals---no matter how many times they tell you this is not true----
IT IS TRUE BECAUSE THEY USE BROAD LANGUAGE IN WHAT TAXES WILL BE USED TO SUPPORT THESE BONDS AND OUR INDIVIDUAL HOMEOWNERS/SMALL BUSINESS OWNERS ARE INCLUDED.
This was the question asked by all election forums in Baltimore tied to Wall STreet Baltimore Development. They are PRETENDING property tax for homeowners CAN BE REDUCED and citizens are only answering these questions. No one was saying ACCEPT CINDY WALSH-----that property taxes in Baltimore cannot go down because of these bond deals; taxes will go up.
I WILL SAY TOWARDS THE END OF THE DEMOCRATIC PRIMARY----VENTURE CAPITALIST WARNOCK AND A FEW OTHERS---AFTER CINDY WALSH DESCRIBING ALL THIS DURING ELECTION FORUMS---STOPPED SAYING BALTIMORE HOMEOWNER PROPERTY TAXES COULD BE REDUCED.
Wall Street players like Stokes, Pugh, Dixon, Mosby, Embry kept PRETENDING they would reduce property taxes when all of the above voted for Wall STreet BAltimore Development bond policies.
What makes all this public policy discussion capture even worse is when our LAW SCHOOLS host these forums and discussions KNOWING the illegality behind all these Wall Street deals. Here we have our UNIVERSITY OF BALTIMORE LAW SCHOOL FORUM which of course created a tiered primary election venue having these establishment candidates in a major forum.
Maryland Policy Forum > Forum >
The Baltimore City Property Tax: How much should it be cut?
TThe Baltimore City Property Tax: How much should it be cut?Debate summary
Almost everyone agrees that Baltimore City’s property tax rate – roughly twice that of any other jurisdiction in Maryland— is an obstacle to the city’s renewal and its efforts to attract new residents and create greater economic opportunity. What few can agree on, however, is how much the city needs to cut its tax rate to be competitive, how to achieve such cuts, and where they should be targeted. Current public policy offers tax breaks for developers to promote building. Critics say breaks should be extended to all residents. Still others say targeted rate cuts for families or newcomers or requiring nonprofits, who don’t pay property taxes, to start would encourage more people and businesses to move to the city. At the Maryland Policy Forum, we think the way to find the best public policy solution to Baltimore City’s tax problem is through vigorous debate. And we know a thriving Baltimore City benefits everyone in the state in terms of higher tax revenue and lower subsidies. Don’t miss the free debate central to the city and state’s future. Sponsorships still available – please contact The Maryland Public Policy Institute at (240) 686-3510. This event is being live streamed, please tune in! Co-sponsors:
Andrew A. Green
Opinion editor, The Baltimore SunAndrew A. Green, the opinion editor, was the city/state editor before coming to the editorial board, and prior to that he covered the State House and Baltimore County government. He writes about state and local government, social issues and elections.
InfoThu, Sep 24, 2015 | 6:15 pm - Reception, 7 pm - ProgramThe John and Frances Angelos Law Center - University of Baltimore1401 N. Charles Street, Baltimore, MD 21201
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Director, McMullen Scholars Program, Calvert Hall College High School Matthew D. GallagherConfirmed
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As with every state and city government agency that has been dismantled and defunded just so services go bad and corruption could soar----now the solution we are hearing----JUST GET RID OF PROPERTY TAXES ON HOMEOWNERS IF SERVICES ARE GOING TO BE BAD. That is indeed what happens when only the global 1% and their 2% can afford to own real estate----and we all become renters or live in global corporate housing.
One Response to “The Baltimore City Property Tax: How much should it be cut?”
Robert Paulsen says:
September 25, 2015 at 4:07 pm
I dont know the numbers, but: As much as possible.
Think of the issue in terms of buying a product. Citizens are paying an exorbitant tax rate for the city (and state) for the simple reason that they own property. I am not OK with this, but even if I was: The schools are terrible, the government is incompetent, the police are corrupt. The services that we are paying for don’t work. So even if one was a fan of higher taxes, we’re not getting our money’s worth by a long shot! What are we buying with our taxes? A broken system. If city services are going to be this bad, then you may as well eliminate the tax entirely.
The word TARGETED should cause all citizens to WAKE UP as now Wall Street global pols knowing property tax rates are going to soar have the job of bringing new families buying homes into BAltimore to pay those higher taxes but first these pols need to PRETEND certain groups of homeowners will be protected. This article shows a breakdown in these TARGETED lower property tax rates which are a few cents on the dollar---TOKEN. Rental and business property not included and property assessments done several years ago found ASSESSING HOME PROPERTY WAY TOO HIGH have of course been corrected SELECTIVELY as well. So, a modest drop came with those able to get a re-assessment of property value while those deliberately out of the loop----those surrounding communities about to become global corporate campuses are still getting soaked in property taxes.
Most homeowners in Baltimore City center are INTELLIGENT citizens who are informed enough to know PROGRESSIVE POSING. While they get token property tax cuts NOW their homes will be the only ones left standing to collect property taxes within this next decade.
Yes, the selective reduction in property assessments and property taxes hit black homeowners hardest because they are the ones living in surrounding communities being made global corporate campuses.
REMEMBER THE PHRASE REPEATED WITH FAR-RIGHT CORPORATE FASCISM----FIRST THEY CAME FOR----THEN THEY CAME FOR-----AND THEN THEY CAME FOR ME.
Already we see factions forming----the new homeowners fighting for that property tax break-----those homeowners receiving new assessments of property taxes lowering their rates a little silent about those not receiving this-----and we see factions across race and class....WHICH IS THE GOAL OF 1% WALL STREET GLOBAL CORPORATIONS. TAX UNIFORMITY IS IN THE US CONSTITUTION AND THE MARYLAND CONSTITUTION AND DOES NOT ALLOW LAWS THAT WEAKEN THIS EQUAL PROTECTION. These selective taxation laws are illegal.
City passes latest property tax break
Spending panel cuts tax rate to $2.13
June 04, 2014|By Yvonne Wenger, The Baltimore Sun
Property taxes for Baltimore homeowners will drop again under Mayor Stephanie Rawlings-Blake's plan to gradually lower the city's rate to bring it more in line with the rest of the state.
The city's spending panel agreed Wednesday to lower the rate to $2.13 per $100 of assessed value — still double the levy of surrounding counties, but down 14 cents in the past two years. The reduction is part of the mayor's plan to knock 20 cents off the tax for homeowners by 2020.
The tax break, approved without discussion by the Board of Estimates, will lower the property tax bill for an average home by $174. The bill for a $145,500 house will drop from $3,269 to $3,095 in the fiscal year that begins July 1.
"Residents have been clear that they want to see action taken to reduce property taxes without a reduction to city services, and we're listening," Rawlings-Blake said after the meeting. "And more importantly, we're taking action that will lay the groundwork for growth in Baltimore."
The tax break is part of the Targeted Homeowners' Tax Credit. The rate for rental properties and businesses will remain $2.25 per $100 of assessed value.
Baltimore's rate remains the highest in the state, but some economists say the mayor is taking a reasoned approach that makes the city's rate more competitive without cutting services, such as public safety initiatives, after-school programs and trash pickup.
Anirban Basu of Sage Policy Group, an economic and policy consulting firm, said the action brings the city's rate "closer to being reasonable."
"The only way to deal with Baltimore's uncompetitive tax rate is to chip away at it in a way that allows for a combination of a balanced budget and taxpayer relief," Basu said.
The board reviewed another of the mayor's ideas to keep city residents and attract new ones by encouraging the development of apartment buildings. That proposal, which still needs City Council approval, would give a tax credit for 10 years to developers who build or renovate apartments throughout the city.
Intended to spur apartment construction and renovation citywide, the credit would give developers an 80 percent break on taxes due for any value added to the property by the project. The percentage would gradually decrease after five years.
A similar program has been available to developers who build and improve apartments downtown.
Together, the tax breaks could help keep members of the millennial generation — the children of the baby boomers — living in Baltimore as they get married, have children, pay down student loans and look for houses to raise their families, Basu said.
The millennials show a propensity to live in urban areas, but as they grow older, Baltimore must find a way to entice them to stay, he said.
"The mayor has begun to unleash a process that I think is very productive," Basu said. "There has to be a concerted effort to drive down these tax rates."
By 2020, Rawlings-Blake's plan will translate into a $291 savings on an average home property tax bill.
The mayor said she sees providing the tax breaks as "a critical component" of her goal to increase the city's population by 10,000 families.
"I understand in order to grow a city, you have to do many things. You have to attract new residents, but you also have to give the residents who are here more reasons to stay," Rawlings-Blake said.
Providing the property tax break will cost the city $20.2 million, which is built into the mayor's $2.5 billion budget that doesn't cut city services for the first time since 2008.
Critics note that while the city is cutting taxes, city water and sewer rates are rising by 42 percent over three years. Bills for a typical customer, including homes and businesses, jumped by nearly $100 this year, and are projected to climb by a total of $250 by July 2015. The water rate increases raise the typical bill from $690 in fiscal 2013 to $784 in fiscal 2014 to $944 in fiscal 2016.
The mayor has said the water rate increases are necessary to repair the city's "crumbling" infrastructure.
Rawlings-Blake has made sweeping changes to the city's overall financial picture. More money has been banked in Baltimore's rainy-day account and a series of changes, such as requiring city workers to contribute more to their pensions, is helping to shore up the long-term structural deficit.
The shortfall is down about $300 million from the $750 million that was projected a few years ago.
The city also is working to implement another tax break approved this year by the General Assembly that will be available to homeowners who move from one house in Baltimore to another in the city. The Resident Retention Credit is capped at $3 million, and will be granted on a first-come, first-served basis.
The city is expected to begin taking applications for the tax credit on Oct. 1. That application and others will eventually be available online, officials said.
"The mayor has begun to unleash a process that I think is very productive," Basu said. "There has to be a concerted effort to drive down these tax rates."
Here we have our local ECONOMIC VOICE in all that involves Wall Street and development and indeed he is a Wall Street Baltimore Development stooge. Basu is almost the only voice in our WYPR Johns Hopkins public media---our Baltimore Sun commentator-----in all public policy panels discussing economic issues and HE WILL NEVER MENTION ALL THESE WALL STREET FRAUDS AND GOALS OF THE FED/WALL STREET ATTACKS ON THE 99% AND PUBLIC WEALTH.
It is painful to listen to these media personalities all knowing where these global neo-liberal economics lead without ever educating WE THE PEOPLE. So, BASU thinks there should be a concerted effort to bring down homeowner taxes but he never mentions how that won't happen---he supports all these Wall Street global corporate campuses, TIFs, bond deals----as does all other BAltimore media personalities allowed media voice.
We discussed the following in detail back in 2012 but with new friends let's look again. Moody's is the Wall Street rating corporation behind the assessment of AAA ratings to toxic subprime mortgage loans central to the massive subprime mortgage fraud. No legal action was taken against these firms so they are still out there giving FRAUDULENT RATINGS---THIS TIME IN THE BOND MARKET.
This is the scam on the 99%-----since the Mayor of Baltimore declared a few years ago Baltimore was on the edge of bankruptcy with all the fraud, corporate subsidy, and misappropriation of our revenue-----we KNOW BALTIMORE IS NOT AN A RATING FOR BONDS. Wall Street says-----no problem we will just PRETEND these bonds are A rated by attaching clauses that say------Baltimore City assures all its tax revenue in paying down this bond debt. THAT ASSURANCE is what 'allowed' Moody's to rate these bonds A.
Of course Baltimore will never meet all this bond debt and other Wall Street debt in this coming economic crash and will default----creating the movement of real estate to private investors. Regarding this discussion on taxation what that default will do as well is throw what are now called A rated bonds down to JUKE BONDS. Know what happens when bonds fall below B ratings? Our pols and Wall Street know------the fees and fines on those bonds rise. So, Baltimore and Maryland Assembly pols with O'Malley and Hogan have set the stage for not only rising taxation on Baltimore citizens regarding the 30 year tie to bonds----not only in the inflation and rise in FED interest rates coming from the economic crash-----but also from being lowered to junk bond status from an A rating when Baltimore was junk bond status BEFORE THESE BONDS WERE APPROVED.
Moody's assigns Aa3 to Maryland's Baltimore City Schools Construction Bonds Series 2016A; outlook stable
Global Credit Research - 22 Dec 2015New York, December 22, 2015 --
Issue: Construction and Revitalization Program Revenue Bonds Series 2016A; Rating: Aa3; Sale Amount: $320,000,000; Expected Sale Date: 01/20/2016; Rating Description: Lease Rental: Appropriation
Summary Rating Rationale
Moody's Investors Service has assigned a Aa3 rating to Maryland Stadium Authority, Baltimore City Public Schools Construction and Revitalization Program Revenue Bonds Series 2016A. The rating reflects the State of Maryland's Aaa rating, the subject-to-appropriation nature of a substantial portion of the revenues funding the deposits that secure the bonds, the high essentiality of the funded projects, and ample coverage of the proportionate share of debt service by the Baltimore City (Aa2 stable) income tax backstop for the city's contribution. The rating also reflects the lack of strong bondholder protections that allow for potential impairment by legislative actions and the significant portion of revenue contributed by an allocation of state lottery proceeds, which, while offering very strong coverage, are volatile and risky over the 30-year horizon of the bonds
The outlook for the bonds is stable based on the stable outlook of the state.
Factors that Could Lead to an Upgrade
Statutory non-impairment covenant
State backstop to lottery revenues
Factors that Could Lead to a Downgrade
Significant reductions in state education aid to Baltimore City Board of School Commissioners (Aa1 stable)
Significant reductions in state lottery and/or Baltimore City income tax revenues
Additional prior claims on lottery proceeds
Legislative actions that impair bondholders, such as causing school aid that currently supports the bonds to be redirected to other purposes
The bonds are a limited obligation of the Maryland Stadium Authority (MSA) payable solely from deposits in a financing fund, described below. The bonds are not a debt, liability or pledge of the faith and credit or taxing power of the State of Maryland, the City of Baltimore, the MSA, the Lottery Agency or any other governmental unit.
The MSA, the Baltimore City Board of School Commissioners, the City of Baltimore and the Interagency Committee on School Construction have signed a memorandum of understanding (MOU) laying out the roles and responsibilities of each party. The bonds are issued by the Maryland Stadium Authority (MSA), which will have certain oversight and management responsibilities for the construction projects.
The bonds are secured by statutorily-required deposits of a minimum of $60 million per year into an MSA-controlled financing fund. Of this amount, $30 million is from funds appropriated by the General Assembly and deposited directly into a financing fund held by the Comptroller and controlled by the MSA. Principal and interest payments are due November 1 and May 1. The deposits are as follows:
Lottery proceeds ($20 million) - The Comptroller is required to deposit, or cause to be deposited, funds from the State Lottery Fund on a semi-annual basis in fiscal years in which bonds are outstanding. The lottery funds do not require appropriation and are subject to a prior claim of $20 million per year for the Maryland Stadium Facilities Fund.
Baltimore City school aid ($20 million) - A portion of state education aid due to the Baltimore City school board is transferred by the Comptroller to the financing fund. State education aid is subject to appropriation by the General Assembly. The Comptroller is required to deposit equal installments of school aid on a bi-monthly basis.
City of Baltimore education aid funds for retiree health costs for the BCSB ($10m). State education funds leveraged by payments by Baltimore to the BCSB and currently used by the BCSB for capital expenditures under a previous agreement between the state, Baltimore City and the BCSB. The funds are now required to be deposited by the Comptroller from state education aid into the financing fund, on a bi-monthly basis.
City of Baltimore bottle tax, table game proceeds and casino rent (minimum deposit of $10 million). Revenue from three sources to be deposited on a semi-annual basis on November 1 and May 1. The Act sets out a minimum deposit schedule of $8 million in fiscal 2014 and 2015, and then $10 million annually in two $5 million deposits until the bonds are no longer outstanding. These deposits are backed up by certain reserves held in a separate facilities fund described below, and a state intercept of undistributed Baltimore City income tax collections.
Deposits the financing fund are pledged to the trustee. The financing fund receives deposits from parties; pays debt service and reasonable bond-related and administrative charges. The balance of the financing fund, which has been receiving deposits since 2014, was approximately $19 million as of December 17 2015.
Sources of Deposits
School aid is appropriated by the General Assembly to the state's school aid fund and distributed to local governments based primarily on state school aid formulas. No further appropriation is required to enable the Comptroller to make the necessary transfers to the financing fund. The BCBSC received about $900 million in state school aid in fiscal 2015, net of teacher retirement costs. As of June 30, the school board had about $160 million in debt outstanding, with capacity to issue an additional $184 million based on its debt policy.
The Lottery Agency generates ticket sales of roughly $1.7 billion per year. Proceeds after prizes, administration, and certain claims are transferred to the state general fund. and equaled about $500 million in fiscal 2014. The $20 million required deposit to the financing fund by the lottery agency occurs prior to distribution to the state and after a $20 million transfer to the Maryland Stadium Facilities Fund to support debt service for sports stadiums and certain distributions to veteran's groups. Coverage of the transfer amount after prior claims is about 25x, based on a fiscal 2015 transfer to the state of about $500 million.
The sources of Baltimore City's required deposits are a beverage container tax, table game proceeds from the Horseshoe Casino, and participation rent payments from the same casino. The container tax was implemented in 2010 at a $0.02 levy on distributors per beverage container, and raised to $0.05 per container in 2013. Tax receipts from the tax were about $10.4 million in fiscal 2015. The table game proceeds are not available until the issuance of video lottery operating license for a new MGM Casino, which is under construction and expected to open in the second half of 2016. Baltimore City's allocation of these proceeds will be 5% of Horseshoe Casino proceeds, of which half will be deposited into the financing fund. The third source of revenues is a requirement that the city deposit 10% of participation rent it receives from the Horseshoe Casino. The city's payment is projected to total about $900,000 in fiscal year 2016, deposited semiannually. City beverage tax receipts and participation rent deposits are subject to appropriation by the Baltimore City Council.
Two Mechanisms Backstop Baltimore City Deposits
To mitigate risk from future volatility or unfavorable trends in Baltimore City payments, the Act establishes a facilities fund to receive excess deposits, if any, from Baltimore City and other amounts in the financing fund not needed for debt service and debt service reserves subject to the discretion of the MSA. If excess funds are transferred from the financing to the facilities fund, the MSA may retain up to $2.5 million per year, up to a cap of $20 million, as a reserve against any future shortfalls in deposits from the city. Excess deposits above the $2.5 million annual maximum may be used to pay design and construction costs, operations and maintenance and other expenses. The facilities fund, including any reserve, is not pledged to the bonds. However, MSA shall use the reserve in the facilities fund to cure deficiencies in deposits by Baltimore Cityand may use any amounts in the facilities fund to pay debt service on the bonds. An executive committee established by the MOU may increase the cap on reserves based on five-year forecasts of the beverage container taxes, table game proceeds and casino rental payments.
If there is a deficiency in Baltimore City payments that reserves are insufficient to cover, the MSA is required to direct the Comptroller within 10 business days of a missed deposit to withhold an equal amount of Baltimore income tax revenue, which the state collects, and credit it to the financing fund by the following June 15 or December 15, well in advance of debt service due dates. Baltimore's income tax receipts were $284 million in fiscal 2014. The city's income tax rate is 3.2%, the maximum allowed by law.
Lack of Rate Covenants or Nonimpairment
Clause Mitigated by Project Essentiality
The security for the bonds consists of a pledge of financing fund deposits and not the revenue sources themselves. There are no rate covenants governing the Baltimore City revenues and state school aid is subject to legislative appropriation. The governing statute does not contain non-impairment language. The $20 million school aid deposit for fiscal 2016 was canceled by the legislature to cover other needs of the Baltimore City school board. However, there were no bonds outstanding when this action occurred. The risks are mitigated by the essentiality of the renovation of Baltimore's schools, demonstrated by the participation of multiple parties in creating the redevelopment program. Furthermore, the lack of rate covenant for Baltimore's contributions is mitigated by the interception of its income tax revenues which provide more than ample coverage of its required contributions.
Use of Proceeds
The proceeds of the bonds will be used to renovate and replace facilities of the Baltimore City Public School System.
The Maryland Stadium Authority was created by an act of the legislature in 1987 to finance and oversee construction of Camden Yards and has since been responsible for financing and oversight of construction of various sports and civic projects.
Maryland is the 19th largest state by population, at 5.98 million. Its state gross domestic product is 15th largest. The state has above-average wealth, with per capita personal income equal to 119.5% of the US level. The state has the 5th lowest poverty rate among states.
The principal methodology used in this rating was The Fundamentals of Credit Analysis for Lease-Backed Municipal Obligations published in December 2011. The additional methodologies used were US Public Finance Special Tax Methodology published in January 2014 and State Aid Intercept Programs and Financings: Pre and Post Default published in July 2013. Please see the Credit Policy page on www.moodys.com for a copy of these methodologies.
For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the rating action on the support provider and in relation to each particular rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.
Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.
Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.
Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.
Marcia Van Wagner
Moody's Investors Service, Inc.
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We have discussed over a few decades the attack on home-ownership by the working and middle-class families. From long-term unemployment to VEOLA ENVIRONMENT and its $600 water bills, to allowing Wall Street to bid on homeowner property debt of very little amounts. All of this is orchestrated to clear the city center and surrounding communities in this march to MASTER PLAN. City center has felt protected from early uses of selected tax rates but has felt the super-sized property tax rate. If city center development has a goal of housing the global 1% and their 2% ----then we will see property taxes rise and rise in Baltimore city center. What will landlords do-----raise rent rates as is already happening making apartment tenant ability to pay ever harder.
THIS IS A LOSE-LOSE FOR BOTH RENTERS AND HOMEOWNERS OVER TIME.
As we discussed----if global corporate campuses are paying no taxes and all development is geared to those global campuses---then there will be all kinds of taxation, fees, and fines especially surrounding home-ownership. So, home inspections costs of all kinds are rising------late filing fees on property reports required by the city go up and up----and as we see here property owners dealing with a city never addressing its water and sewage pipeline are now being pressed to pay all infrastructure upgrade costs.
All of this has two goals---first, to remove working and middle-class from home-ownership making way for the incoming rich. As well, it creates the conditions for forcing the large real estate grab needed in handing off to global investment firms. Global developers want large land mass and forcing people out of their homes to do that. Again, every expense coming to a rental property will be passed on to the renters until they cannot find anyone willing to pay those rental prices.
THIS IS WHERE THE NEED FOR GLOBAL RICH COMES INTO US FOREIGN ECONOMIC ZONES.
This is what all that bond debt in Baltimore is meant to do------continually place pressure on city homeowners for higher and higher taxes, fees, and fines. There will be very few home-owner winners living in Baltimore now.
Homeowner questions huge jump in home insurance premium
An unusual increase highlights methods for premium calculation
January 31, 2013|By Steve Kilar, The Baltimore Sun
In the six months that have passed since Margaret Fulcher received her most recent homeowners insurance policy, she has moved on from being shocked to simply incensed.
The premium to fully insure her Baltimore rowhouse increased fourfold last year — to a sum she can ill afford and one that she thinks does not accurately represent the cost of replacing her home.
"This is a case of homeowners insurance underwater," said Fulcher, comparing her premium to a mortgage that is worth more than the home to which it is attached.
Although Fulcher's skyrocketing increase — from $861 to $3,383 — is an extreme, premiums throughout Maryland have been increasing in recent years. It's a result of more payouts and higher building costs, experts say. And many homeowners might want to begin setting aside money to pay home insurance bills, which show no sign of leveling off.
"How many more people are they doing this to?" asks Fulcher, 60, who gets by on disability income after suffering several strokes in her 40s.
Fulcher's insurance story begins with the August 2011 earthquake. Part of her roof pulled away from the wall, causing a severe leak. She had the leak fixed, to the tune of $2,000 out of pocket (her policy didn't cover earthquake damage), but a claims agent came out and inspected her home.
After that inspection, she received a letter. Her three-story brick house near Little Italy and the Perkins Homes would cost more than $563,000 to rebuild if totally destroyed, the letter said.
Before that, her home's replacement value was $167,000. Her insurer, Travelers, declined to comment on her case, citing privacy issues.
"This is not a half-million dollars' worth of house," Fulcher said. "Whatever it would be replaced with would not cost half a million, you can bet on that."
'No expensive stuff'
She bought the house, at East Baltimore and North Caroline streets, from the city more than 30 years ago. It's big, about 3,400 square feet, but it's not fancy. The main kitchen area, on the first floor, still has harvest gold-colored appliances. The bathrooms are not bedecked in granite or marble. There is no heat in the stairwell.
"There is no expensive stuff in here," Fulcher said. "All I did was put down carpet because it was all tile. ... I have done nothing to it."
Built in 1920, according to tax records, the house's street level was designed as a storefront, as were the rest of the buildings on her block, which has long been on the cusp of gentrification. The state values the home for property tax purposes at less than $350,000, and Fulcher says that comparable homes in her neighborhood are selling for well under $300,000.
She refused to shell out the new premium, but it was paid by her mortgage company, so now she owes the money to her lender. A review of the policy by the Maryland Insurance Administration determined that nothing was amiss, and now Fulcher is awaiting a hearing on the administration's decision.
In the meantime, she called two other insurance companies, she said, but was quoted similar rates. She feels stuck with the new, expensive policy, she said.
"I don't need a half-million dollars' worth of insurance," Fulcher said.
Homeowners insurance rates have gone up moderately in the past few years, according to the state insurance administration. The average rate for the most common type of policy in Maryland went up less than $100 between 2005 and 2010, according to administration records. In 2005, the average homeowner paid $696; in 2010, the average was $784.
Replacement cost — the factor that increased so drastically on Fulcher's house — is only one component insurance companies use to calculate rates, according to the administration.
The replacement figure does not encompass the value of the land on which the home is built but is intended to cover the expense, minus any deductible, to return the home to the way it was before the loss occurred. It is not supposed to take into account the market value of the home.
Prior claims, the manner of construction, a home's age and the adequacy of municipal fire protection are other considerations insurance companies use to calculate rates, according to the insurance administration.
Plus, there are variables about the policy itself that can influence the premium, including the amount of coverage required by a mortgage lender and the deductible, the administration said.
At State Farm, a major insurer of homes in Maryland, rates are "based on each state's claims experience," said Anna Bryant, a regional spokeswoman for the company. "We take into account claims during previous years as well as projected losses, expenses and premiums," she said.
Increasing claims amounts are driving the rise in premiums, said David L. Corum, vice president of the Insurance Research Council, a nonprofit supported by property and casualty insurance companies and their associations.
If we know that development plans over decades in Maryland knew the Federal government has been requiring a response to sewage and other environmental degradation---AS IT SHOULD HAVE----we know Maryland and Baltimore citizens have paid twice over in water bills, property taxes, all kinds of public trusts----the revenue that could have addressed these Federal requirements AND addressed the fact that BIG AG was draining our state aquifers and ground water creating bad conditions for our well-water home-owners. ALL THIS WAS HAPPENING DECADES AGO.
If the goal is to move rural citizens into US cities deemed International Economic Zones---then you allow all these issues to build---and then fail to be able to afford infrastructure upgrades. Indeed, the building of density in Baltimore has many unhappy rural dwellers being moved into the city.
The RAIN TAX is an example of how tax policy is being geared to making only the affluent ----and then the rich ---able to own property. It was simply another layer being added to property assessment.
NO, THE RAIN TAX IS NOT LEFT-LEANING. REAL LEFT-LEANING POLS WOULD HAVE ADDRESSED THIS WITH REVENUE PAID BY CITIZENS OVER DECADES and not misappropriated all that revenue to building global corporations and markets.
When a pol comes to office shouting with outrage over taxation---as with Larry Hogan ----removing this one or two taxes while leaving all of the other MOVING FORWARD to global corporate campuses and ONE WORLD International Economic Zones---they are CONSERVATIVE POSING on taxes because these taxes, fees, and fines will have to be assessed. This is why Republican Erhlich kept raising taxes, fees, and fines never educating against policies he was pushing that caused this.
Community Associations & Maryland's New Stormwater Fees
May 1, 2013
Highlight: Maryland has new local stormwater fees that will be implemented in certain counties beginning July 1, 2013.
Counties and property owners affected: All real property, including those owned by community associations, located in Anne Arundel, Baltimore, Carroll, Charles, Frederick, Harford, Howard, Montgomery, and Prince George’s counties and Baltimore City. The only properties within those ten jurisdictions exempted by state law from paying the fee are those owned by the state, counties, municipalities and volunteer fire departments.
Purpose: The purpose of the law is to establish the local means and dedicated funding source to implement local stormwater management plans and upgrade and restore stormwater management facilities, streams and creeks in the most heavily-developed areas of Maryland.
Background: In December 2010, the U.S. Environmental Protection Agency issued the Chesapeake Bay Total Maximum Daily Load (“TMDL”), effectively establishing a “pollution diet” for nitrogen, phosphorus and sediment discharges to surface waters that the six Bay watershed states and the District of Columbia must meet by 2025. In order for Maryland to meet its pollution diet, the state's plans call for improvements to stormwater management practices contributing about 17% of nitrogen reductions and about 45% of the phosphorus reductions necessary to meet the TMDL goals. Current estimates of the cost to implement these stormwater improvements are approximately $7.4 billion statewide through 2025. Failure of a state to meet its pollution diet may result in the federal government withholding federal funding for state water management programs, the withdrawal of state authority to manage and issue all water discharge permits, and potentially significant fines.
The Law: On May 2, 2012, Governor O’Malley signed into law House Bill 987. In short, the law requires those jurisdictions within Maryland that are subject to a Municipal Separate Storm Sewer System (“MS4”) Phase I permit to establish a local Watershed Protection and Restoration Program, including a local stormwater fee to fund its operations, by July 1, 2013. A last-minute push to postpone the implementation of the stormwater fees to July 2015 stalled in the Maryland House of Delegates on the final day of the 2013 General Assembly session.
How the fees are calculated: While the state law provides a general broad outline of what is required in each Program, it leaves the structure and operational details up to each individual jurisdiction, including exactly how they may generate the necessary funds. Jurisdictions are authorized to charge property owners flat rate fees, graduated amounts based on the amount of impervious surfaces or any other approach they prefer. The law does require that the local jurisdictions give some credit to property owners for measures that reduce the quantity or improve the quality of stormwater discharged from their property, and that the fees are adjusted for owners experiencing substantial economic hardship.
Where the Counties are now:
Each jurisdiction is engaged in the process of determining how to respond to the State’s mandate and structure its own Program. A one-page comparative spreadsheet of each jurisdiction’s current status may be found here.
What Community Associations should do: Depending on its location, each community association should, at a minimum, consider the impact of these fees on its membership and/or on its own budget and determine if steps should be taken to obtain credits.
Please note this is a rapidly-evolving matter in each county and Baltimore City. Sources used in compiling this summary may not necessarily reflect the most up-to-date information, so please consult your attorney. We are monitoring these issues closely and are prepared to answer questions and assist each community upon request.
Anne Arundel County
Bill No. 2-13 establishing the County’s Program and fee structure was passed by the County Council on April 15, 2013. However, the County Executive vetoed the bill on April 25th. On May 1st, the County Council overrode that veto, allowing the bill to become law. It is currently anticipated there may be some follow-up effort by the County Council in the coming weeks to amend fees charged to businesses and potentially consider a phasing-in of charges for residential property owners.
The bill charges an annual flat fee for residential properties of $34, $85 or $170 per dwelling unit based on the property’s zoning classification. A fee of $85 per 2,800 square feet of impervious area will be charged annually for any multifamily residential and non-residential (i.e., commercial, industrial, agricultural, etc.) properties, with the following exceptions and modifications:
- The fee charged to multifamily residential properties that are condominiums will be divided by the number of dwelling units on the property and that amount billed separately to each condominium dwelling unit owner.
- If non-residential property is owned by a homeowners association (“HOA”), the total stormwater fee for all properties owned by that same HOA cannot exceed the number of property tax accounts for property owners within the boundaries of the HOA multiplied by a fee of $34.
- Multifamily residential and non-residential properties charged more than $500 per year will be charged 60% of the calculated fee in Fiscal Year 2014 and 100% of the calculated fee in each Fiscal Year thereafter.
- The stormwater fee charged to non-residential properties will be capped at 35% of the property’s base real property tax bill.
- Nonresidential property owned by a religious group or organization will be charged a flat $1 fee, regardless of the amount of impervious surface on the property.
Bill 20-13 was passed by the County Council on April 15, 2013. It establishes the general framework for the County’s Program, the fees for Fiscal Year 2014 and directs that a separate Executive Order will annually establish fees charged under the Program after Fiscal Year 2014. Future annual Executive Orders will set each year’s fees unless those fees are objected to by a majority of the County Council.
The bill specifies that the fee charged to residential properties beginning July 1, 2013, will generally be $21, $32 or $39 per year. Residential, condominium or cooperative ownership properties (but not apartment complexes) will be charged $29 per dwelling unit. A non-residential, parcel owned by a condominium association or HOA will be treated as non-residential, non-institutional land and charged $69 annually per every 2,000 square feet of impervious surfaces.
Institutional, non-residential property (i.e., private schools, churches, etc.) will be charged $36 annually per every 2,000 square feet of impervious surfaces. Other commercial and industrial property, including apartment complexes, will be charged $69 per every 2,000 square feet of impervious surface.
Credits generated by recognized best management practices (“BMPs”) may not reduce the fee charged by more than 26% of the initial calculated rate. The fee will appear as a line item on each property’s annual tax bill.
At this time, no bill has been introduced by the Board of County Commissioners to implement the Program. The Board has charged the County’s Environmental Advisory Council (“EAC”), an established citizen stakeholder group, to study the available options and to make recommendations to the Board of County Commissioners for legislation to implement a Program and associated fee structure. The EAC has been meeting and is scheduled to meet twice a month between now and June, with the intent of allowing the County to implement its program by July 1, 2013.
Bill 2013-09 was introduced before the County Commission on April 16, 2013. It establishes the general framework for the County’s Program and directs that the fees charged shall be established by the County Commissioners each year as part of its annual budget process.
While the fees proposed for this upcoming year have not yet been formally proposed, information suggests that the proposed annual residential fees will be approximately $11, $16 or $32 based on the dwelling type. In addition, a rate of approximately $32 per every 3,255 square feet of impervious surface is anticipated for non-residential property.
It is anticipated that condominium properties will be charged approximately $11 per dwelling unit. As introduced, the bill is unclear as to how it will treat non-residential common area property owned by a condominium association or HOA.
Frederick County is currently preparing a draft ordinance to adopt the required Program that will be introduced to the Board of County Commissioners in the coming weeks. A Division of Community Development staff presentation was made to the Commissioners on March 7, 2013, during which various proposals were presented to establish a funding system similar to those introduced in other counties. In response, the Board of County Commissioners directed its staff to develop a plan charging a flat rate of cent ($0.01) per parcel. County staff anticipate the bill will be introduced by May 11, 2013, and that a public hearing will be held May 30th.
It is unclear how the County anticipates fully funding work that may be required for its stormwater management program and whether or not a different fee structure may eventually be approved by the County Commissioners. It should be noted the Frederick County legislative delegation was the only one to introduce bills during the 2013 General Assembly session that would have specifically exempted Frederick County from the House Bill 987 mandate. However, this legislation did not make it out of the respective chamber committees.
Note that the City of Frederick has a pre-existing fee program dedicated to stormwater management so properties within the City limits will not be subject to the County Program once implemented.
Bill No. 13-12 was passed by the County Council on April 16, 2013, and approved by the County Executive on April 23, 2013. The bill proposes to charge an annual flat fee of $125 for any property with a residential use (except for apartment buildings) or agricultural use. A fee of $7 per 500 square feet of impervious area will be charged annually for any property with a business, commercial or industrial use, including apartment buildings, mobile home parks and separate common area parcels owned by condominium associations or HOAs. However, nonprofit owners of these properties will be charged a flat fee of $125.
Critically, the bill also limited the fees charged by the County to each property owner to 10% of the fees otherwise calculated as being due. A separate Resolution, No. 12-13, was passed on April 16th to establish a Task Force that will meet to review and make recommendations to the County Council on the programs structure and fee schedule beyond Fiscal Year 2014.
Credits of up to 100% of the initial stormwater fee calculated for a property may be applied based on the use of BMPs. Regulations will be developed by the County to implement the credit program.
The fee will appear as a line item on the property’s annual tax bill. The fee will not apply to properties in Aberdeen, Bel Air, Havre de Grace or any other incorporated town or city as they are not subject to the County’s MS4 permit.
Bill No. CB8-2013, establishing the County’s stormwater program and Resolution CR21-2013, establishing the program’s fees, were approved by the County Council on March 28, 2013.
The bill and resolution established an annual fee of $15 per 500 square feet of impervious area to be charged to every improved residential, commercial and industrial property in the County. There are no flat fees established for residential properties as are common in other jurisdictions. Common areas owned by condominium associations, HOAs or other type of common ownership will be charged in the same manner. These common area stormwater fees would either be billed directly to the condominium association or manager of the property or, if no such association or property manager exists, equally divided among the number of owners within the association and added to their individual bills.
The County program will apply a 50% reduction to the impervious area assessed for a property subject to a Site Development Plan that was filed with the County on or after January 1, 2003. A credit for the use of various specific stormwater treatment practices on properties will be available for properties not eligible for this automatic reduction, up to a maximum of 50% of the fee otherwise applicable. In addition, one-time reimbursements are available for investments in certain stormwater management practices implemented on properties where stormwater is not treated to the current State standards.
The fee will appear as a line item on the property’s annual tax bill.
Bill 34-12, expanding and amending the County’s existing stormwater management fee program, was approved by the County Council on April 17, 2013. The bill, together with Executive Regulation 17-12AM approved by the Council on April 30th, establishes the Program’s structure, procedures and implements a new fee program. The final rates charged under the Program will be set by Council action in mid-May and revisited yearly thereafter. For 2013-2014, annual single-family residential rates are expected to range from approximately $29 to $264. Multifamily, commercial and industrial properties will be charged annually based upon a rate of approximately $88 per 2,406 square feet of impervious area on the property. The bill provides that one-third of the fees otherwise calculated will be charged in the first year, two-thirds charged in the second year and the full amount charged in the third year.
Residential property developed as a condominium will be charged approximately $88 per 2,406 square feet of impervious surface, with the fee divided equally among and billed to each of the unit owners. Non-residential property owned by a condominium association or HOA is charged the same rate. In addition, privately-owned roads that are subject to public use and qualify for state highway funds are subject to these same fees. However, these roads may be able to qualify for grants to offset up to 100% of the stormwater fees they would otherwise be charged.
The proposed Executive Regulation will also include a “tiered” cap for property owned by non-profit organizations. These three tiers, based on the actual amount of impervious surface on a property, will cap the amount the property owner may be charged. Credits of up to 60% of the otherwise calculated fee are available for properties subject to the most-current environmental site design stormwater standards; 50% for those that utilize less-advanced stormwater BMPs.
Montgomery County's fees will not apply in the Cities of Rockville or Takoma Park as they have their own existing stormwater programs. The City of Gaithersburg has elected to have the County’s existing program apply within its boundaries. The fee will appear as a line item on each property’s annual tax bill.
Prince George’s County
Prince George’s County already charges a stormwater utility fee that may satisfy certain requirements of House Bill 987. However, the County and local municipalities that will otherwise be subject to House Bill 987’s requirements have engaged in discussions to determine if and how the County program should be adopted by those local municipalities. County staff are currently evaluating how the existing program should be structured, what fees should be charged, and system of credits and hardship exemptions. This final program will require legislative approval from the County Council prior to enactment by July 1, 2013.
Bill No. 12-0155 was introduced to the City Council on November 19, 2012, and remains pending before the City Council. Multiple public hearings and work sessions have been held throughout the process to discuss potential amendments to the legislation, and are currently scheduled to continue through at least May 14th. It is anticipated the fee structure currently proposed for certain property types and owners will be amended by the City Council.
The annual fee would be invoiced to property owners in equal quarterly increments on the property’s water bill or, if no such water service is provided, on a separate bill to the property owner. As introduced, the bill proposes to charge an annualized flat fee of $48, $72 or $144 for single-family residential properties based on the amount of impervious surfaces they contain. An annualized fee of $72 per 1,050 square feet of impervious area would be charged for other properties in the City. These non-residential rates are the highest of any of the ten jurisdictions when compared on an equivalent basis.
With parcels utilized by separate commercial businesses or for multifamily residential purposes, the stormwater fee will be charged to the parcel’s “master water meter” account when available. If no such master meter is available, the fees will be divided equally among those meters assigned to that parcel. For shared common areas established as a separate parcel and serving condominiums or HOAs, the fees for that common area parcel will be assigned to the master water meter associated with that common area parcel whenever possible. If there are multiple water meters associated with that shared common area parcel, the fee for that common area parcel will be divided equally among the metered billing accounts unless the common area property owner directs otherwise.
In addition, draft regulations to implement the City’s program were provided for stakeholder and public review on April 1st. The draft regulations provide that credits may be applied in amounts not to exceed 45% of the initial calculated fee. While standard stormwater best management practices apply to account for credits generation, Baltimore City is unique in allowing residential property owners to participate in events such as stream cleanups, tree plantings and de-paving events in order to reduce the fees they are charged.
When the goal of global International Economic Zone policies are to have all foreign economic zones with the same global corporate policies, government structures, and societal structures with Trans Pacific Trade Pact and global corporate tax laws reduced to a very simple-----THERE IS NO CORPORATE TAX FOR THIS AND THAT----while the tax code looks like this article below geared to WE THE PEOPLE trying to keep our houses-----we have global, far-right 1% Wall Street players writing our tax policy. This is ridiculous in a city claiming to want to build home-ownership creating stress by allowing unemployment to grow above 50% and it will reach 80% by the end of the decade as this economic crash brings all local economies to a halt. Global corporations will be hiring more and more from the global labor pool so home-ownership by US citizens---citizens in Baltimore will disappear.
IN THE WORLD OF ONE WORLD EXTREME WEALTH AND POWER ONLY THE RICH CAN OWN PROPERTY-----THAT IS WHAT OUR FOUNDING FATHERS CAME TO AMERICA TO ESCAPE AND OUR US CONSTITUTION FORBIDS EXTREME WEALTH AND EXTREME POWER.
This is a really long article but please glance through to see the time and effort to craft tax policy against WE THE PEOPLE.
Tax (Lien Certificate) Sale 2016
Frequently Asked Questions
Updated March 15, 2016
A Tax Lien Certificate Sale is a public sale of lien interests on properties. The sale is used as a method to collect delinquent real estate taxes and/or other unpaid municipal fees and charges owed to the City of Baltimore all of which are liens against the real property address. The Mayor and City Council of Baltimore generally holds this sale once each year in May. The winning bidder does not purchase the deed to the property, but purchases a Tax Lien Certificate. In order to acquire the deed, the law requires the purchaser to file a Complaint in the Circuit Court for Baltimore City to foreclose the right of redemption. The foreclosure procedure includes obtaining a decree from the Circuit Court for Baltimore City, preparing a deed, paying all liens that have accrued from the date of the Tax Lien Certificate Sale, and recording the deed in the Land Records of Baltimore City.
- Who is responsible to pay taxes?
- When do real estate property taxes become delinquent?
- Will there be additional interest or penalty?
- Are delinquent taxes advertised?
- What is a Tax Lien Certificate?
- Is my property scheduled for a Tax Lien Certificate Sale?
- Why wasn’t I notified of the Tax Lien Certificate Sale? Can I get copies of what was sent?
- The notice states that you are going to sell my property. What does that mean?
- What delinquent charges qualify a property for a Tax Lien Certificate Sale?
- What can I do to keep my property from going into a Tax Lien Certificate Sale?
- Can I stop the property from going into a Tax Lien Certificate Sale by paying half of the bill?
- Once my property goes to a Tax Lien Certificate Sale, will I still own it?
- How do I redeem my property after the Tax Lien Certificate Sale?
- Are there any other expenses in addition to the cost of the lien for which I will be responsible?
- What is the bidding process?
- Do I have to register as a bidder if I wish to bid on the purchase of tax lien certificates in the City’s Tax Lien Certificate Sale or Assignment Sale?
- What do I do if I forget my password?
- When are my bids due?
- What is a Batch?
- What equipment or software do I need to be able to participate?
- Is there a tutorial for the use of the Internet Tax Sale System?
- What is a High Bid Premium and how is it calculated?
- How often is the web site updated to reflect the current lien values?
- How are bidders required to make payment to the City for Tax Lien Certificates awarded as a result of the Tax Liens Certificate Sale?
- What is an ACH Debit?
- Is the $100.00 registration fee subtracted from the amount of liens due?
- What type of document is issued at the Tax Lien Certificate Sale?
- What if there are no bids?
- Can the Tax Lien Certificate be assigned over-the-counter directly from the City? Can I get a list of these liens? Can I assign them after the sale?
- What are the Risks with Tax Lien Certificate Sales?
- What is an assignment? What is the difference between assignment and Redemption?
- How are Tax Lien Certificates redeemed?
- If my Tax Lien Certificate expires before I can file foreclosure on the property, do I get my money back?
- What are the procedures for filing a foreclosure and how long does this process take? Will the City of Baltimore handle the foreclosure process for a fee? If so, what is the fee?
- Subsequent to redemption of the Tax Lien Certificate, how does the Tax Lien Certificate Holder receive the money?
- What if the Property is not redeemed?
- What is the life of a Tax Lien Certificate?
- When can the homeowner redeem his/her property out of the Tax Lien Certificate Sale?
- How can I get a current list of Tax Delinquencies? Can I be placed on your mailing list for future mailings? Is there a charge for this list?
- How can I get a copy of the statutes regarding the Tax Lien Certificate Sale in your jurisdiction?
- Can a Tax Lien Certificate be voided?
1. Who is responsible to pay taxes? top
Property owners. Every owner of record of real property must pay real estate property taxes on that property. Real estate property taxes on rental properties are the responsibility of the property owner. If there is a mortgage on the property, it is the responsibility of the property owner to send or deliver the real estate property tax bill to the bank, building association or other lending institution. Some, but not all, mortgage companies pay the real estate property tax bills. Only when, as a condition of the loan, an escrow account is established does the mortgage company pay the real estate property tax bill. Real estate property taxes are due and payable every year even if there is no mortgage due on the property.
2. When do real estate property taxes become delinquent? top
Real estate property taxes are due and payable on July 1st and become delinquent October 1st each year. Under the Annual Payment Schedule, real estate property taxes become delinquent as of October 1st. Under the Semiannual Payment Schedule, the first installment becomes delinquent as of October 1st, while the second installment becomes delinquent as of January 1st. Failure to receive a real estate property tax bill will not relieve the owner of the requirement to pay the taxes or subsequent penalties imposed as of October 1st or January 1st should the taxes become delinquent.
3. Will there be additional interest or penalty? top
Yes. Penalty and interest will be assessed on all delinquent real estate property taxes at the rate of 1% interest per month or fraction thereof on the State portion of the bill and 2% per month (1% interest and 1% penalty) or fraction thereof on the City portion of the bill until the bill is paid in full.
4. Are delinquent taxes advertised? top
Yes. At least thirty (30) days before any property is 1st advertised for sale, the Collector must mail a Final Bill and Legal Notice to the property owners of record. An alphabetical list of all properties with delinquent real estate property taxes or other municipal liens is published at least 2 times, once per week, in alternate weeks, in newspapers of general circulation. The list is also posted on the City’s website four weeks prior to the Tax Lien Certificate Sale. The advertisement specifies the website, date and time that the on-line sale will be conducted and gives instructions on how to access the Baltimore City’s website. The advertisement also notifies the public that some of the properties may be subject to a special Bulk Sale held later in the year. Advertising fees are added to the delinquent liens included in the advertisement.
5. What is a Tax Lien Certificate? top
A Tax Lien Certificate is a negotiable instrument sold by the City at the Tax Lien Certificate Sale. The Tax Lien Certificate is evidence that the Tax Lien Certificate Holder has purchased an enforceable lien against the real property at 18% per annum redemption interest. The minimum bid necessary to purchase a Tax Lien Certificate is listed beside each delinquent parcel in the advertisement and includes gross tax, penalties and interest including any applicable costs pertaining to the Tax Lien Certificate Sale.
6. Is my property scheduled for a Tax Lien Certificate Sale? top
To find out if a property is scheduled for a Tax Lien Certificate Sale, please contact the Tax Sale Office at 410-396-3987 and select option #1, or go to the website BidBaltimore.com.
7. Why wasn’t I notified of the Tax Lien Certificate Sale? Can I get copies of what was sent? top
A Final Bill and Legal Notice is mailed in February to all property owners of record, to the address provided by the property owner and contained in the Baltimore City Real Estate Property records. The property is advertised in at least two newspapers of general circulation and also advertised on the Baltimore City website. A copy of the Final Bill and Legal Notice can be provided to the homeowner by contacting the Tax Sale Office at 410-396-3987 and selecting option #1. In addition, you can also find the list of properties currently scheduled for tax sale at BidBaltimore.com, beginning on March 16, 2016.
8. The notice states that you are going to sell my property. What does that mean? top
The statement refers to the unpaid real estate property taxes and/or other unpaid municipal fees and charges owed to the City of Baltimore, all of which are liens against the real property address. Participants in the Tax Lien Certificate Sale can bid and purchase the Tax Lien Certificate, which means they actually pay the outstanding bills to Baltimore City on behalf of the property owner. The Tax Lien Certificate Holder does not purchase the deed to the property, and cannot acquire the deed unless the Circuit Court for Baltimore City grants a Right to Foreclose the Right of Redemption (of the homeowner). The foreclosure procedure includes obtaining a decree from the Circuit Court for Baltimore City, preparing a deed, paying all liens that have accrued from the date of the Tax Lien Certificate Sale, and recording the deed in the Land Records for Baltimore City.
9. What delinquent charges qualify a property for a Tax Lien Certificate Sale? top
A property shall be scheduled for a Tax Lien Certificate Sale for any municipal liens with a combined value totaling $250.00 or more for non-owner-occupied properties and $750.00 or more for owner-occupied residential properties. These liens include but are not limited to Real Estate Taxes, Special Benefits Assessments, Alley and Footway Paving Bills, Streetscape, Minor Privilege, Multi-Family Dwelling, Clean and Board, Water, Environmental Control, and Residential Registration charges and fees. However, unpaid Water bills must be delinquent at least three quarters and have a balance of at least $350.00 for non-owner-occupied properties and at least $750.00 for owner-occupied residential properties to qualify for tax sale. Also, a property cannot be scheduled for tax sale if an Alley Paving lien is the only delinquent bill. However, the property owner will receive a Final Bill and Legal Notice indicating possible legal action. Environmental Control Board citations can go into tax sale by themselves if the total balance of all citations issued on a property after October of 2014 was $1,000.00 or more and all the appeals have been exhausted.
10. What can I do to keep my property from going into a Tax Lien Certificate Sale? top
Paying all outstanding delinquent charges and any applicable costs at any time on or before April 29, 2016, can stop the Tax Lien Certificate Sale process.
11. Can I stop property from going into a Tax Lien Certificate Sale by paying half of the bill? top
No. Under the law partial payments cannot forestall a property from the Tax Lien Certificate Sale. All outstanding delinquent charges and any applicable costs must be paid to stop the Tax Lien Certificate Sale process. The only exception in this regard is for Footway Paving bill when an approved payment agreement is in place.
12. Once my property goes to a Tax Lien Certificate Sale, will I still own it? top
The property owner maintains ownership of the property and has the right to redeem until the Circuit Court judge signs a Decree to Forecloses the Right of Redemption (of the homeowner).
13. How do I redeem my property after the Tax Lien Certificate Sale? top
The City’s redemption procedure is governed by and in conformance with the Annotated Code of Maryland, Tax Property Article section 14-828(3). A Tax Lien Certificate Holder has no right to possession of the property until a deed is acquired. Pursuant to the Annotated Code of Maryland, Tax-Property Article section 14-828, when the property is redeemed, the person redeeming shall pay to the Collector the following:
- The total amount of the liens paid at the Tax Lien Certificate Sale including 18% per annum redemption interest.
- All current taxes together with any interest and penalties on those taxes and
- Any actual expenses or legal fees allowed pursuant to Tax-Property section 14-843.
Yes. There is 18% per annum redemption interest applied to the lien amount when redeeming the property. If the property is certified by the Mayor and City Council as requiring substantial repairs, the tax sale purchaser may after 60 days from the date of the sale file a complaint to foreclose the rights of redemption. Immediately after the sale, the owner may be responsible for additional cost including the cost of the substantial repair certificate, attorney's fees, title search and other expenses. If the owner of the property or a party with an interest in the property has not redeemed within 4 months from the date of the Tax Lien Certificate Sale on non-owner-occupied properties, the Tax Lien Certificate Holder is entitled to attorney’s and title search fees and certified mail and postage costs as provided by law. The Tax Sale Certificate Holder is entitled to the same fees and costs 7 months from the date of the Tax Lien Certificate Sale on owner-occupied residential properties. If the property has not been redeemed within 6 months from the date of the Tax Lien Certificate Sale, the Tax Lien Certificate Holder may file a Complaint to Foreclose the Right of Redemption on non-owner-occupied properties. On owner-occupied residential properties, the Tax Lien Certificate Holder may file a Complaint to Foreclose the Right of Redemption if not redeemed within 9 months from the date of the Tax Lien Certificate Sale. The foreclosure procedure includes obtaining a decree from the Circuit Court for Baltimore City, preparing a deed, paying all liens that have accrued from the date of the Tax Lien Certificate Sale, and recording the deed in the Land Records for Baltimore City. In conformance with the Annotated Code of Maryland, Tax Property Article section 14-843, the Tax Lien Certificate Holder is entitled to only the fees and costs incurred and include the following:
- Applicable fees and costs if the property is certified as in need of substantial repairs -
- Costs of substantial repair certificate,
- Reasonable attorney’s fees not to exceed $500.00,
- Title search fees not to exceed $250.00, and
- Certified mailing and postage costs.
- Four months after the tax sale on non-owner-occupied properties and seven months after the tax sale on owner-occupied residential properties -
- Costs of recording certificate of sale,
- Reasonable attorney’s fees not to exceed 500.00,
- Title search fees not to exceed $250.00, and
- Certified mailing and postage costs.
- Six months after the tax sale on non-owner-occupied residential properties and nine months after the tax sale on owner-occupied residential properties if a foreclosure proceeding was filed in the Circuit Court -
- Reasonable attorney’s fees of $1,300.00 if an affidavit of compliance has not been filed and $1,500.00 if it has been filed,
- Reasonable attorney’s fees not to exceed $1,200.00 for opening an estate,
- Additional attorney’s fees if approved by the Court, and
- Title search fees, service of process fees, publication fees, posting fees, postage and certified mail fees, and other fees if approved by the Court.
Bidding starts with the lien amount due at the time of the Tax Lien Certificate Sale. The lien amount is the sum of delinquent amounts owed to the City of Baltimore plus expenses incurred in making the sale. The Tax Lien Certificate Sale lien is awarded to the bidder who submits the highest Bid Amount, that is, the amount they would be required to pay to the property owner as part of a foreclosure proceeding. All properties sold at the Tax Lien Certificate Sale may be subject to a High Bid Premium.
16. Do I have to register as a bidder if I wish to bid in the City’s Tax Lien Certificate Sale or Assignment Sale? top
Yes. Bidder Registration is required to make the sale of tax lien certificates proceed in an orderly and expeditious manner, and to provide the City with better record keeping ability. Registration begins on March 16, 2016, and must be completed online at BidBaltimore.com. All bidders must pay a $100.00 non-refundable registration fee in order to participate in the tax sale. Registration is not complete until the applicant receives a bidder number. No one will be permitted to register after registration ends at the close of business on May 6, 2016.
17. What do I do if I forget my password? top
Please be careful to remember your password, as it is the key to your access to the BidBaltimore.com web site. If, however, you forget your password, it may be recovered easily by clicking on the "Forgot your password?" link on the BidBaltimore.com home page. When you provide your matching personal information, a new temporary password will be sent to your registered email address. This password will need to be changed after your next login.
18. When are my bids due? top
Bids can be entered and saved on the BidBaltimore.com web site at any time following the first publication of the Advertising List on March 16, 2016; however, bidders will not be able to submit bids until May 13, 2016. The advertised list will be divided into 8 batches, which will close hourly beginning at 9:00 a.m. Eastern Time on May 16, 2016. Bids can be withdrawn or altered at any point up to the closing of the Batch on the day of the sale. The advertised list will be available for review on the web site beginning March 16, 2016.
19. What is a Batch? top
A Batch is a subgroup of the Advertised List that serves as a means of organizing tax certificates for the purpose of facilitating bid submission. Batches are offered and the bids entered as of that time accepted on each hour between 9:00 a.m. and 4:00 p.m. on the date of the Tax Lien Certificate Sale (May 16, 2016). Each Tax Lien Certificate in each Batch is offered independently of every other Tax Lien Certificate. The Tax Lien Certificates are arranged in sequential order.
20. What equipment or software do I need to be able to participate? top
A bidder must have a computer with Internet access and a web browser (recommended: Internet Explorer 7.0 or higher or Mozilla FireFox 2.0 or higher).
21. Is there a tutorial for the use of the Internet Tax Sale System? top
Bidders are encouraged to participate in the Auction Demo and Trial Auction on the BidBaltimore.com website prior to bidding.
- Auction Demo - Please log in and click the Auction Demo link under Auction Site Training Tools. The instructions are designed to lead users through the auction process.
- Trial Auction - Please log in and click the Trial Auction link under Auction Site Training Tools. The Trial Auction is a simulation of a real auction, in which bidders practice bidding and, subsequently, viewing auction results.
The Tax Lien Certificate Sale auction will be held using the High Bid Premium method as provided for in the Annotated Code of Maryland, Tax Property Article section 14-817(b)(2) tease. The High Bid Premium is calculated on the amount of the Bid Amount that exceeds the threshold: either 40% of the property’s Assessed Value or the property’s Lien Value (whichever is greater). In Baltimore City the high-bid premium shall be 20% of the amount by which the highest bid exceeds the greater of a.) the lien amount; or b.) 40% of the property’s full cash value (note the full cash value is the assessed value). The High Bid Premium is to be paid on the date of the sale along with all taxes and other municipal liens, interest and penalties, and all costs incurred in the Tax Lien Certificate Sale. In accordance with State law no interest is paid to the Tax Lien Certificate Holder on the High Bid Premium. The Collector will refund the High Bid Premium, without interest, to the holder of the Tax Lien Certificate on redemption of the property or to the Plaintiff in an action to foreclose the right of redemption on delivery of the deed for the property for which the Tax Lien Certificate was issued. The High Bid Premium is not refunded until or unless the property is redeemed or the deed is delivered subsequent to an action to foreclose the right of redemption. Here is an example:
Assessed Value of the Property: $10,000.00
40% of Assessed Value is: $4,000.00
Lien Amount is: $200.00
Bid Amount of: $6,000.00
The Bid Amount Exceeds 40% of the Assessed Value by: $2,000.00
The High Bid Premium: $400.00 (20% x $2,000.00 = $400.00)
Total Amount Due at Sale: $ 600.00 (High Bid Premium plus Lien amount)
The balance of the bid price is the amount of the bid ($6,000.00) less the amount paid at the sale ($600.00) or $5,400.00. The balance of the bid price is the amount that is subsequently paid to the property owner for the property once the deed is processed and all subsequent charges have been paid.
In the above example, the property is valued at $10,000.00. A High Bid Premium of 20% is applied to the amount by which the bid exceeds 40% of the Assessed Value. Bids start at the lien amount ($200.00) and proceed upwards. The amount by which the bid exceeds 40% of the Assessed Value in the above example is $2,000.00 and this amount is subject to the High Bid Premium of 20%. For determining High Bid Premiums on BidBaltimore.com, if the Assessed Value listed is zero dollars, the High Bid Premium will be calculated based on the greater of the Lien Amount or 40% of the Full Cash Value listed in the Property Details. If both the Assessed Value and Full Cash Value listed are zero dollars, the High bid Premium will be calculated using the Lien Amount.
23. How often is the web site updated to reflect the current lien values? top
The data on the BidBaltimore.com web site, including the assessed values, lien values, status (whether open or paid), etc., will be updated on the following dates:
- March 16, 2016
- March 30, 2016
- April 13, 2016
- April 27, 2016
- May 2, 2016
- May 9, 2016
- May 12, 2016
24. How are bidders required to make payment to the City for Tax Lien Certificates awarded as a result of the Tax Liens Certificate Sale? top
The only acceptable method of payment is ACH Debit. Bidders will enter their bank account information on the BidBaltimore.com web site prior to the auction. Once the auction is completed, bidders will be debited for the total amount of their winning bids, including any applicable High Bid Premiums. No other form of payment will be accepted.
25. What is an ACH Debit? top
An ACH debit is an electronic funds transfer from your bank account, initiated by the Tax Collector with your prior authorization. For more information on ACH, please visit the NACHA, the Electronic Payments Association at www.nacha.org. Funds must be drawn from a US financial institution. Some types of money market, brokerage, and/or trust accounts cannot accept ACH debits. Please check with your financial institution prior to initiating payment on the web site.
26. Is the $100.00 registration fee subtracted from the amount of liens due? top
No. The registration fee is non-refundable and is not subtracted from the amount of the liens.
27. What type of document is issued at the Tax Lien Certificate Sale? top
The Tax Lien Certificate is issued 6 months after the Tax Lien Certificate Sale, if the property has not been redeemed.
28. What if there are no bids? top
If there are no bids for a property, the Tax Lien Certificate is held by the Mayor and City Council. These Tax Sale Certificates are available for assignment at a scheduled assignment sale, which will be held on Thursday, May 19, 2016. The certificates can be assigned for the amount of the lien. After the initial Assignment Sale, the City held Tax Sale Certificates are available for assignment and can be assigned for the amount of the lien plus 18% per annum redemption interest to the date of purchase.
29. Can the Tax Lien Certificate be assigned over-the-counter directly from the City? Can I get a list of these liens? Can I assign them after the sale? top
Subsequent to the Tax Lien Certificate Sale and Tax Lien Certificate Assignment Sale, Tax Lien Certificates are assigned on a first come-first served basis and can be assigned over-the-counter directly from the City. They may also be assigned by mail. All certificates are freely assignable.
30. What are the Risks with Tax Lien Certificate Sales? top
The purchase of a Tax Lien Certificate is a risky investment. Investors are strongly advised to investigate the property they intend to purchase and know exactly what they are buying before bidding at the Tax Lien Certificate Sale. The Collector gives no guarantees and makes no representations regarding property title or the nature of the interest in the property that is listed. The Collector gives no guarantees and makes no representations regarding prompt redemption or return of the lien amount, high bid premium etc. Some risks include:
- Investment Capital is frozen: The money invested in the Tax Lien Certificate is unavailable for use. From the date of the Tax Lien Certificate Sale until the property is redeemed or until foreclosure is finalized, there is no access to the money invested. Emergency funds should never be used as investment capital, as the funds will be “frozen” for a time.
- The property owner may file bankruptcy. In the event the property owner files for protection under the bankruptcy law, the certificate holder is prevented from enforcing the lien until the bankruptcy is released. The bankruptcy court can lower the interest rate and order payments to be made over a period of time.
31. What is an assignment? What is the difference between assignment and Redemption? top
An assignment is when an individual or firm has the Tax Lien Certificate transferred to him or her from a previous Tax Lien Certificate Holder for his or her own personal gain with no interest or benefit to the property owner. Tax Lien Certificate Redemption is a payment received from the homeowner, mortgager, or Title Company or other party who is in privity with the homeowner such as the mortgagor or title company for the entity who holds a valid contract of purchase for the said property or the holder of a recorded instrument such as a judgment etc. The effect of redemption by one of those parties listed above is to shift the liability for the municipal liens from the Tax Lien Certificate Holder to the redeeming party. The property owner then becomes responsible to pay the liens, expenses and redemption interest to the party who has redeemed on behalf of the property owner and the interest of the Tax Lien Certificate Holder is extinguished, and the Tax Lien Certificate becomes void.
32. How are Tax Lien Certificates redeemed? top
The City’s redemption procedure is governed by and in conformance with the Annotated Code of Maryland, Tax Property Article section 14-828(3). ATTENTION: Current law as applied by the Baltimore City Collector requires the Tax Lien Certificate Holder to collect from the redeeming party the amount of actual legal expenses or fees. The redeeming party still must pay the City of Baltimore directly for all liens plus interest and any applicable subsequent taxes. A Tax Lien Certificate Holder has no right to possession of the property until a deed is acquired. Pursuant to Annotated Code of Maryland Property Tax-Property section14-828, when the property is redeemed, the person redeeming shall pay to the Collector the following:
- The total amount of the liens paid at the Tax Lien Certificate Sale including 18% per annum redemption interest.
- All current taxes together with any interest and penalties on those taxes.
- Any actual expenses or fees allowed pursuant to the Annotated Code of Maryland Tax-Property section 14-843
The City has established the following business rules, governing certain aspects of the Tax Sale and ancillary processes. These rules are consistent with the authority granted to the City under the Annotated Code of Maryland Tax-Property Article section 14-817(4) to set the terms of the Tax Sale.
- Timely Notification by Tax Lien Certificate Holder of Legal and Other Expenses:
- Tax Lien Certificate Holders are required to provide the City with a means of notification, either an e-mail address or facsimile telephone number, where they can be reached to facilitate redemption the Tax Lien Certificate. The address of record must be kept current, with the City receiving timely notification from the Tax Lien Certificate Holder of any change in the manner by which they are to be notified. This information should be initially provided by completing the bidder registration screen on the BidBaltimore.com web site. Any subsequent changes to this information shall be provided to the City as a request to change the Tax Lien Certificate Holder notification address. For e-mail, the request should be sent as an e-mail request to Tammy.Hollie@baltimorecity.gov, or for facsimile notification by faxing the request to the Baltimore City Tax Sale Office at 410-837-6994.
- The Tax Sale Office will not assess or collect any fees before or after the filing of a complaint to foreclose the rights of redemption. The Tax Lien Certificate Holder must collect any fees and provide a legal fee release to the Tax Sale Office. The release must include the amount of attorney’s fees, the amount of the title search fees, and any other costs must be submitted on legal letterhead stationery. All correspondence in this regard shall be sent to the Tax Sale staff by e-mail or at the following address:
200 Holliday Street, Room 1
Baltimore, Maryland 21202
If the Tax Lien Certificate Holder fails to respond to the City’s contact in a timely and/or satisfactory manner, the City may, at its sole discretion, elect to complete the redemption on behalf of the party in interest without the inclusion of legal and other allowable fees incurred by the Tax Lien Certificate Holder.
After the City provides notice of redemption to the Tax Lien Certificate Holder, any additional action taken or additional fees or expenses incurred by the Tax Lien Certificate Holder shall be at its own expense.
The redeeming party still must pay the City of Baltimore directly for all liens plus interest and any applicable subsequent taxes.
- Upon filing a complaint to foreclose the rights of redemption, additional fees may be applicable six months for non-owner-occupied properties and nine months for owner-occupied residential properties from the date of tax sale or sooner if there is a substantial repair order.
- The City defines “owner-occupied residential property” as a property which is coded as “H” by the Maryland State Department of Assessments and Taxation (“SDAT”) on January 1st of the year before the date of the tax sale. That coded designation will be published online by the City and shall remain associated with the property for all purposes related to that tax sale, including notices, foreclosure filing dates, dates for adding fees and costs, and redemptions. After online publishing, it shall remain unchanged for all purposes for that tax sale, regardless of errors or subsequent changes in the coding by SDAT.
33. If my Tax Lien Certificate expires before I file foreclosure, do I get my money back? top
No. If the Tax Lien Certificate Holder/Assignee has not filed foreclosure within two years from the date of the Tax Lien Sale Certificate, or within ninety (90) days on Bulk Sale Certificates, the Tax Lien Certificate Holder forfeits their investment and no refund is issued.
34. What are the procedures for filing a foreclosure and how long does this process take? Will the City of Baltimore handle the foreclosure process for a fee? If so, what is the fee? top
The Foreclosure procedure is through the Baltimore City Circuit Court and includes obtaining a decree from the Circuit Court for Baltimore City, preparing a deed, and paying all liens that have accrued from the date of the Tax Lien Certificate Sale. The City of Baltimore cannot assist in the foreclosure process. You may want to seek the advice of an attorney.
35. After redemption of the Tax Lien Certificate, how does the Tax Lien Certificate Holder receive the money? top
When the property is redeemed prior to the issuing of the Tax Sale Certificate, the Tax Lien Certificate holder will automatically receive a refund check from the City of Baltimore for the lien amount, and all applicable interest and costs. If the Tax Lien Certificate has been issued to the Tax Lien Certificate Holder, the Certificate must be returned to the City before the refund is issued.
36. What if the Property is not redeemed? top
Under the terms of the Tax Lien Certificate Sale, if the property is not redeemed within six months from the date of the Tax Lien Certificate Sale, the Tax Lien Certificate Holder may file a Complaint to Foreclose the Right of Redemption, take title to the property, and may be entitled to recover additional expenses. Foreclosure procedure includes obtaining a decree from the Circuit Court for Baltimore City, preparing a deed, paying all liens that have accrued from the date of the Tax Lien Certificate Sale, and recording the deed in the Land Records for Baltimore City. Once the foreclosure has occurred, the Tax Lien Certificate Holder is also required to pay to the City the Balance of Purchase (the difference between the amount of the liens and the amount of the bid).
37. What is the life of a Tax Lien Certificate? top
A Tax Lien Certificate has a two-year life span and is void two years from the date of the Certificate unless a Complaint to Foreclose the Right of Redemption is filed in the Circuit Court for Baltimore City, prior to the normal expiration of the Tax Lien Certificate.
38. When can the homeowner redeem his/her property out of the Tax Lien Certificate Sale? top
Tax Lien Certificate Sale redemption can begin as early as May 26, 2016, and continue until such time that a Circuit Court judge signs a decree foreclosing the right of redemption.
39. How can I get a current list of Tax Delinquencies? Can I be placed on your mailing list? Is there a charge for this list? top
A list of delinquent properties will be available March 16, 2016, and can be downloaded prior to the Tax Lien Certificate Sale from the website BidBaltimore.com. The City does not maintain a mailing list.
40. How can I get a copy of the statutes regarding the Tax Lien Certificate Sale? top
The Tax Lien Certificate Sale statutes are in the Maryland Tax-Property Article and are available online at http://mlis.state.md.us/asp/web_statutes.asp. The sections for Tax Lien Certificate Sales are 14-808 through 14-854 inclusive. You can also contact the City’s Legislative Reference at 410-396-4731.
41. Can a Tax Lien Certificate be voided? top
Yes. Occasionally it may be necessary for the Collector to void a Tax Sale Certificate after award. In that event, neither the owner nor the City will pay interest, legal fees, costs, or any other charges to the Tax Lien Certificate Holder.
The same subprime mortgage frauds from last decade are going strong with this coming economic crash and those mortgage deals being used to lure young adults to buying homes in our US cities deemed International Economic Zones are tied to this mess. Where some citizens are being made to look like housing winners----wait until the end of next decade to see the goal----only the global rich will be allowed to own real estate.
THAT IS WHAT THE 1% WALL STREET LIBERTARIAN EXTREME WEALTH AND POWER CROWD ALWAYS DO.
This is why we know the 5% to the 1% being bought as Wall Street players with all kinds of real estate handoffs----will be thrown under this real estate-owning bus.
If we know this is the goal of 1% Wall Street pols we know when they are posing progressive or conservative on taxation.
The elderly are of course only keeping their homes often because of REVERSE MORTGAGES which are being attached to GLOBAL INSURANCE corporations that will be claiming bankruptcy in this coming economic collapse---of course they are all tied to the subprimed bond markets. This will force seniors out of homes earlier than these policies say.
Only the rich and elderly will own homes within a decade, think tank warns
Nine in ten under 35s on modest incomes could be frozen out of home ownership by 2025, analysis by Resolution Foundation finds
Property prices are now out of reach for most young people
By Camilla Turner
10:15AM GMT 13 Feb 2016
Nine in ten under 35s on modest incomes could be frozen out of home ownership within a decade, a thinktank has warned.
The 16-35 age group could become permanent renters as property ownership increasingly becomes restricted to wealthy and older households, according to a new analysis by Resolution Foundation.
Over 45s now account for three-quarters of all homeowners, while those aged 65 plus make up one-third of homeowners, up from less than one-quarter in 1998 - an increase of 43 per cent.
Meanwhile those aged 16-34 account for just 10 per cent of homeowners, down from 19 per cent in 1998, a 49 per cent reduction.
Matt Whittaker, chief economist at the Resolution Foundation, said the findings highlight how much the housing landscape for young, working people on modest incomes has changed.
“At the turn of the century, just over half of this group owned their own place; today it’s one-quarter,” he said.
“If that pace of decline continues, we can expect home ownership to be available to fewer than one-in-ten by the end of the next decade.”
The Resolution Foundation’s analysis, which will be published early next week in a report titled Living Standards 2016, shows that home ownership among under-35s from modest income working households has plummeted, from 57 per cent in 1998 to just 25 per cent.
Meanwhile, levels of private renting have more than doubled, from 22 per cent to 53 per cent.
“If we want to see an increase in working families being able to afford to buy, it is essential that the housing shortage is tackled by the Government"
Matt Whittaker, Resolution Foundation's chief economist
In London, the proportion of younger modest income working households owning their own home more than halved over the last decade, falling to just 13 per cent.
If home ownership were to continue to decline at the same rate in the capital for this group, by 2025 it would drop below one-in-20.
Nationally, homeownership has been falling slowly since the start of the century – following a steady increase from the 1950s onwards – and stands at around 63 per cent today.
Mr Whittaker said: “With the average modest income household having to spend 22 years to raise the money needed for a typical first time buyer deposit – up from just 3 years in the mid-1990s – it’s no surprise that owning is increasingly a pipe dream for many.
“If we want to see an increase in working families being able to afford to buy, it is essential that the housing shortage is tackled by the Government. Schemes such as Help to Buy can only ever help a minority – often providing a leg-up to those who would eventually climb onto the housing ladder anyway.
"More than half of those benefiting from Help to Buy to date have household incomes in excess of £40,000. It is hard to imagine any way out of the home ownership crisis facing those on low to middle incomes that doesn’t involve significantly boosting house building.”
A Department for Communities & Local Government spokesman said that the analysis was "outdated" and used data from 2013/4.
“We want to ensure that anyone who works hard and aspires to own their own home has the opportunity to do so and in the last year alone we have already seen a 25 per cent increase in the number of new homes built," he said.
“Our initiatives like Help to Buy have helped nearly 270,000 people to buy a home of their own since 2010 and we are delivering 200,000 new starter homes, which will offer a 20% discount to first-time buyers.
“This is part of the biggest, boldest and most ambitious plan for housing in a generation which we are backing by doubling the housing budget.”