JadedJC wrote:
PILOTS are based on the selling price of the condo when it first changes hands between developer and the initial owner. The reason you see big variations within the same building is that many buildings were completed right at the height of the real-estate bubble around 2007--08. The units that were first sold during this period will have higher PILOTS because they were pretty much sold at the peak of the market. When the market tanked after 2008, the developers in these buildings still had unsold inventory that they subsequently marked down in price - hence these units will have lower PILOTS. The PILOTS do not reset with a resale of the property.

dtjcview wrote:

Also, the implied tax rate against implied current market value would be:

7.184 * 0.3272 = 2.35%

Yvonne wrote:
I suggest you get a copy of the agreement. I have attended many council meetings and have witnessed many abatement agreements. You would be surprised how different some agreements are. Some are base on construction cost other agreements are based on sales price. Then other agreements have bump up costs and others agreements do not.

dtjcview wrote:
Useful detail on the process under:

http://www.state.nj.us/treasury/taxat ... /referencematerials.shtml

Strictly speaking, PILOTS and abatements are different things. The PILOT is paid by a developer instead of paying property taxes, abatements are a reduced assessed value, that typically are applied for up to 5 years after an improvement to an existing property. One big different is the PILOT is paid to the City only, whereas an abated property pays taxes to both City and County. PILOTS don't contribute to school funding for example - a huge local issue.

As far as having different assessment on similar condos, its probably not an exact science. The assessment is probably done when the master deed on a new or converted condo property is filed with the County, and not necessarily at the time of purchase/sale. If the assessments differ between similar condos, it might be related to how and when the developer filed the deed, or converted it's use from a rented apartment subject to a PILOT, to a condo subject to regular property tax.

Bottom line, the assessment isn't directly related to the purchase/sale price, though may be incidentally related as a result of timing.

From what I understand, Abated properties do not pay real estate taxes. They make PILOTS Payments In Lieu of Taxes. These are typically based on the selling price, at least mine was, but I suppose could be based on assessed value, and paying a percentage of tax. I think that some of the older buildings may have been done in this fashion.