You know what they say, what’s old is new again. Buying a property in a historic district is probably a unique investment you could ever make. You own a relic of history and allow tenants to have a one-of-a-kind rental experience too. That being said, however, buying a property in a historic district can present its own set of challenges that you would not face by buying a traditional property. It could definitely be worth it in the end of the day if things are properly executed.
Older homes usually come with better quality construction. This is not just a nostalgic fantasy – they’re better-built because in the past, higher grades of lumber were easier to come by, and labor was relatively cheap. Builders could afford to spend more time on craftsmanship that can’t easily be replicated in today’s houses.
Historic districts or neighborhoods are likely to boast lovely old trees and other mature landscaping. The aesthetics of older neighborhoods inspire many home buyers to seek them out.
Historic homes may be eligible for substantial breaks on property taxes, or even credits for preservation or renovation projects. Historic homes in designated historic districts are subject to rules in order to maintain the neighborhood’s historical character and significance — which means you won’t have to look at an acid-green eyesore because your next door neighbor got a good deal on some hideous paint.
Homes in designated historic districts appreciate more – in some cases, much more – than similar homes not located in such districts, according to independent studies of local historic districts in New Jersey, Texas, Indiana, Georgia, Colorado, Maryland, North and South Carolina, Kentucky and Virginia.
On average, according to the studies, values of historic properties increased by 26 percent more than for homes without the “historic” designation. So whenever there are historic homes for sale you should consider investing in them. In addition, historic neighborhoods were found to be more stable, with both homeowners and renters choosing to stay longer than their counterparts in non-historical areas. The bottom line is that if your heart is set on a historic home, your head should not have a problem with it.
The designs and architecture of historical properties are simply breathtaking. Some designs have existed for decades, or even centuries! The era a property is built in will dictate many of its features. Some will have cool features, like stained glass windows, colored bricks, and pocket doors that will make the property stand out. Historical and well-maintained houses and properties are known for their ever-growing valuation throughout the years and decades. And this, for the simple reason art lovers is mostly interested in architectural details, paintings, and adornments specific to different decades and centuries. This is enough of a reason for some tenants to rent. Historical properties are always important to art lovers and architectures for architectural details, paintings, and adornments specific to different decades and centuries. Some people like to enjoy a week on the beach, while others would rather hang out in a Victorian house.
Maintaining a property in a historic district takes a lot of responsibility. To encourage investors in buying an investment property in these districts, government at the local, state, and even federal levels have put in place certain tax benefits and credits. You could also qualify for easements. An easement is an agreement between the owner of a historical property and a preservation group whereby the owner’s income tax, property tax, or estate tax is reduced. Another great thing about easements, they last forever. You could be eligible for different kinds of benefits too, be sure to check with your local and state government. So, you get to preserve the great history and earn tax benefits at the same time! What more could you ask for?
The value of a historical property in a historical district is much more than that of a typical property. They tend to be 26% higher, on average, to homes that are not historic. The return on investment in historical properties is also higher in historical homes. Many studies of historic districts in Texas, Maryland, North Carolina, South Carolina, among others, attest to this.
Many tenants in historic districts tend to stay long-term. This is great for you since it reduces vacancies. But still, if traditional renting is not your thing, you could always rent your historic property. As previously mentioned, visitors love to stay or even tour historic properties.