I bought a new condo in January; and now the OWNER is asking me to pay HIM property taxes...?

Question

The owner said that the city hasn't assessed our individual units yet, so he paid the taxes on the entire building and now wants us to pay him back. We don't even know how he came up with the amount! He sent us a letter (that might as well have been written on a napkin) that wasn't even signed saying that we have two weeks to make full payment or we can pay it over the next five months... what should I do?

Answer 1

Condos have to go thru a committee in the municipal government to apportion the property tax of the building to each owner (part - owner of the entire condo). This process can take some time but the property taxes for the property come due when they are due. So the builder is forced to pay them and collect them back from the owners of the condo.

Look at your purchase agreement with the builder and you will see it under a sub-heading called ADJUSTMENTS.

Answer 2

Is it the owner or the developer ?  If it's the developer check your sales contract carefully and see if there were any mention about the taxes to come later.  A lot of times the city will asses the owner of the building if/while it's developed.  

If the original sales contract does not have anything about this you may be able to skip it this year.  But, if the developer does in fact have a tax bill for the entire building then you should get a copy of it and work out with the Condo association what the actual amounts per unit s/b.   Make sure you include all the units (even unsold/undeveloped areas) as those areas the developer should pay for.

If he refuses to give you a copy of the tax bill, tell him you are not pay a penny until you have the copy and copies of how he calculated the distribution.  

There are a lot of developers who will try to pass on the whole buildings taxes on only the sold units to help his cash flow and profits.

Answer 3

This sounds strange to me.

Every time I have bought a house, our lawyer has taken care of checking the tax roll.  On our final purchase contracts, there has been adjustments for any taxes paid in advance.

If my condo was $200,000, and the owner had paid taxes in advance totalling $1000, then I actually owed him $201k in order to complete the transaction.  

If he's sending you a letter that does not detail the amounts in a professional manner, I think I would take a copy of the letter to the municipality.  I'm willing to guess that he owed back taxes, and is trying to trick youo into paying them.

Answer 4

Owner?  You mean the developer?

If the sale was handled through a title company and/or lawyer, all the taxes due should have been apportioned and collected during the sale.  Check your title papers.  

In California, the assessor will set the value of the property as of the date of sale (Proposition 13 - based on the sale price) and the buyer will have to pay taxes from the date of sale to the end of the government's fiscal year.  The developer may have been assessed for any condos not sold during the year and is trying to pass the bill to others (you).  In any case, the developer cannot require you to pay any taxes for which he is responsible without a court order.  Better get together with the other buyers and get a lawyer to cut him off at the knees.

Answer 5

i would demand to see the papers stating that he paid the taxes and to see what you amount would be, IF he paid them is devide the number by how many units are in the building...that should be the amount.

Answer 6

you are obligated to pay proprty tax once the land tittile is transfer to you...and this should be done through your lawyer and the developer lawyer...

Answer 7

All you need to do is contact the Lawyer or Notary who handled your Purchase.   He/She will tell you exactly what you need to do, and if you have already taken care of your share on your Statement of Adjustments.

Don't worry about any of this.  The person who handled the sale will tell you simply and easily whether you are responsible for it or not.

Answer 8

It doesn't sound unreasonable that you would have to pay something for property taxes. I wouldn't be pleased, though, if I was paying taxes for a part of the building that I didn't have the right to reside in.

If you have questions about the amount payable, get the owner to justify the amount he's asking you to pay. Even if the entire building was occupied, certain units should have different tax values, based on the view, size of the unit, etc. Not all units should be equal, in other words.

If you're not satisfied with the amount that's being asked of you, you may need to get your lawyer involved.