By Staff
LANSING – Low-income families who purchase a home from a non-profit housing program such as Habitat for Humanity would be considered the original owner of the property under legislation introduced by Sen. Ron Jelinek.
This designation would prevent assessors from applying the "pop-up" factor and increasing the property taxes when the families take control of the house.
"Most of the families who purchase homes through Habitat for Humanity are on limited incomes and cannot face the burden of having a property tax payment that is too high for them to afford living in the house," said Jelinek, R-Three Oaks. "This will help low-income families get off to a new start in a new home."
Michigan law states that property taxes are assessed at the current market value upon transfer of ownership of a home, commonly called the "pop-up" tax. While most assessors consider a low-income family buying a Habitat-built home to be the original owners, a few agencies are considering them the second-owners (the Habitat program being considered the first) and raising the taxes before they've even moved in.
This assessment method severely impairs a family's ability to afford the new house. SB 80 has been referred to the Senate Committee on Finance.