how many more units need to sell before developer exits the board?

46 units left to sell.

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The developer has one only seat left out of the 5 total seat on the board. The developer has already lost the control of the board.

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Yes, but the developer will have that seat and certain rights until all units are sold.

does anyone know what the current jersey city tax rate is? (what percentage should i be using to multiply my purchase price to get to taxes per year?)




The actual Real estate taxes generally turn out to be about $2.00 per $100 of sale price. Though the formula is based not based on sale price actual taxes appear to be 2% of sale price.


46 units left to sell.

As of June 15th looks like 4 1bed units and 2 pent house units left to sell by builder

> As of June 15th looks like 4 1bed units and 2 pent house units left to sell by builder

Last I heard they were sold out, the sales office is gone...

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The tax abatement directive is not a city driven one it is a state driven one. This is uniform through out the state. The relevant code is NJSA 40A-20 and other related directives which have become law.

The tax abatement period can be up to 30 years and begins on the substantial completion of the project. Generally the builder completes few floors at a time and occupancy is staggered. The township does not deem a unit as complete in terms of construction until an occupancy certificate is obtained. This certificate is obtained on the day of closing. So the tax abatement period begins when the first occupant moves in.

Sorry for the long narrative, but the only way to explain this is define the logic behind it and what laws guide the abatement schedule.

# 11 says
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# 11 your second statement is partially not right. It is based on the latest true arms length sale. It is governed by a state law NJSA 40A:20-3(b). However, if the recent sale price results in a lower tax than the existing tax. The existing tax stays put. But as you say one can opt out of the PILOT.

Taking into consideration that the property taxes in Jersey City are 7.1837% of the assessed value it may not work out for many. The assessment in Jersey City tends to be 20-22% of resent sale price.

#11 wrote

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#11 This is a bit more complicated than the simple formula above.

The Pilot has three tax components - a) the city component which is a negotiated item between the city and builder , b) the county component which is fixed by the county for all such programs at 5% of the city component and c) a 2% administrative charge levied by the city.

The city component is based on the annual gross revenue of a unit. Annual gross revenue is mortgage plus interest plus maintenance. The mortgage and interest is calculated on the selling price of the property and not on the actual mortgage. The selling price is the latest selling price. So on a resale the current selling price prevails and not what the original owner paid. The mortgage rate is the current mortgage rate.

The city component is 10% of gross revenue for years 1-5, 12% years 6-10 and 16% for years 11-30. However, if this results in a lower PILOT at a future sale the highest PILOT amount that existed prior to this sale prevails.

Now with lower mortgage rates even higher prices in some cases result in lower PILOT amount. But the city will not reduce it.

Here is an example: Current PILOT $ 8, 600 per year.

Recent sale $ 1,300,000
Current mortgage rate 3.75%
Current maintenance = $ 800 per month
Mortgage=$ 6,020 per month (city calculates on the selling price not actual mortgage)

Annual Gross revenue is (800+6020)*12=$ 81,840
City PILOT component= 10% of $ 81,840= $ 8, 140
County PILOT component= 5% of $ 8,140= $ 409.20
Administrative component= 2% of $ 8,140= $ 162.80

Total PILOT = $ 8,712.00 annually. Since this is higher than the current PILOT of $ 8, 600 this becomes the new PILOT.
Some members of credit unions can obtain mortgages at 3.25% and their new PILOT $ 8,290, but they would still have to pay $ 8, 600.

"The city component is 10% of gross revenue for years 1-5, 12% for years 6-10 and 16% for years 11-30. However, if this results in a lower PILOT at a future sale the highest PILOT amount that existed prior to this sale prevails."

The percentages in the statement above that I have made in # 39 above may have been further reduced on a subsequent appeal.