When a new ‘For Sale’ sign goes up on any number of established streets in the South End, those who have been there for a long time – those who have fought the battles required of living a life in the City – begin to tense up as they hear the suggested sale prices.
Likely, it will go for more than the $3 million or $4 million that properties fetch today.
The tenseness isn’t because of a changing neighborhood or a new wave of new people. Rather, it has everything to do with property taxes, and how much those huge sales will once again drive up tax bills, as sales on one’s street have a great deal to do with the valuation of a home for tax purposes.
“Every time one of my neighbors sells, I’m like ‘Oh my God, how much is this one going to be for?’” said Jim Cullion, a South End resident for 37 years. “It’s fine if you want to sell, but if you’re staying, those sales turn into huge tax bills…My taxes for last year were $30,000, which I thought was absorbatant. This year they went up $6,000. I’m paying $36,000 in property taxes. I didn’t intend on living in a fancy neighborhood. I noticed it going up before, but now it goes up and up every year. My plan was to have my house paid off and live off the rents in my retirement.”
All over the South End, long-time residents and Senior Citizens – sometimes one and the same – are facing the decision about whether or not to pay those high tax bills, to sell their properties and go to a cheaper part of the city, or use the proceeds from the sale to rent. For many, it’s a dramatic departure from the plan they thought they would follow in their older years. But when sales continue to increase into the multi-millions, it causes assessments of existing homes like Cullion’s to also increase; and with major cuts to the City Budget not an option at City Hall, rising assessments mean rising tax bills.
Longtime resident Ken Kruckemeyer said, like many, he uses is Social Security to pay the taxes on his home – which he has owned since the 1967. He said he is fortunate because he is able to dip into savings to pay his expenses, but many don’t have that.
“I think this problem of whether or not to stay because of taxes is true of a lot of people in our South End neighborhood,” he said, noting that his current yearly taxes dwarf what he paid for the home in 1967. “It’s not unique to the South End, but we seem to be at the pinnacle. I guess that’s because the houses are so much more costly. For a lot of people like myself, to pay taxes on the house is about equal to the Social Security check I get. That means all the other costs like utilities and other costs have to come from some other source.”
The dilemma comes down to whether residents can, or want, to continue to pay those huge costs while retired or on limited income. It eventually comes down to an uncomfortable, forced choice many didn’t foresee having to make.
“It’s a real dilemma and something the City needs to address, whether it believes people rooted a long time in a neighborhood should have the opportunity to afford to say there,” he said.
For long-time residents like Ron Johns, that decision was to leave the neighborhood he had been connected to since 1970. Johns moved into his first South End home on Dartmouth Street in 1970, paying $13,000 for it. It needed everything, and he fixed it up little by little, he said, while also enjoying the growing and diverse neighborhood around him. After a life change and a move to the Back Bay for a while, he came back and lived on Waltham Street in a condo. It was where he planned to live out his life among his friends and neighbors that he had known for decades.
“I loved it,” he said. “I would have stayed forever. However, I cashed out.”
Now, Johns lives in Dorchester, and he said he has gotten used to it, but it was not an easy decision.
“It was a very hard decision,” he said. “I didn’t want to leave, but the costs were just too much. I was playing cards and a friend asked if anyone knew someone looking for a place in Dorchester. I said I was. I decided right there. I sold my condo at $10,000 over asking price after only one day…My taxes are at least half what they were and my costs are half. It was hard, but I’m comfortable. I have more square footage than I had in the South End. I have more than what I had in the South End for half the price. You can’t fight that.”
Johns said despite the emotions, at 72, he was in good enough health to be able to use the MBTA and get around easily. He said the real worry for him is the elderly couples and widows in the South End. He said he already knows of three longtime residents that used to live on this block. They have sold, even though they didn’t want to, and used the proceeds to rent apartments in other parts of the city.
“I feel particularly sorry and worried for the older couples and older widows,” he said. “They are retired. If someone sells for $4 million on their street, they’re screwed. If any house is worth $2 million this year on the assessment, then it will be worth $3 million the next year. Getting a $6,000 tax increase on top of an existing $30,000 bill is just impossible. Nobody plans for that.”
At City Hall, the issue is one that is somewhat isolated.
While there are pockets of high-priced properties in the downtown neighborhoods and in Charlestown, most of the rest of the city has much lower values and very low tax bills compared to cities and towns around Boston. It makes it a problem that is hard to attack because it isn’t citywide.
“Property values are doing a lot better than they were 10 to 20 years ago,” said Assessing Commissioner Nick Ariniello. “One thing we can do to try to make the City more affordable for all residents is we have classifications with our tax rate. We can shift the tax burden from residential to commercial properties…That shift does make it a lot more affordable to our residents…The City of Boston is significantly more affordable than other places like Newton, Cambridge, or even Arlington and Somerville. We are a leader in the state in terms of affordability for homeowners.”
He said residents can and should take advantage of all the programs available to veterans, Senior Citizens, and owner-occupants. There are also state “circuit breaker” programs to help with the taxes, and a Senior Work-Off program that the City sponsors for $1,500. Cobbled together, those things can help, but they make only a “small dent” in a $36,000 tax bill.
Age Strong Commissioner Emily Shea said she encourages any Senior Citizen grappling with the issue to contact her office. They can help long-time homeowners come up with a plan to deal with the tax bills. One of those is to defer the taxes until there is a sale.
Like many of the programs, there are income restrictions on that, and one must be 55 as of July 1, 2019. However, the basic premise is that the taxes can be held over with a 4 percent rate until the house is sold. When the home sells, the City keeps whatever the balance might end up being.
“One thing we are committed to in our office is helping to get the word out,” Shea said. “Certainly if people are having trouble making ends meet, there are a number of programs to help…Assessing is fantastic for tax exemptions and deferral programs, but what we can do is help people plan for the larger picture.”
For those in the South End like Cullion, they are stuck in a vortex where they are middle class, house-rich, but retired with limited income. Many programs they don’t qualify for, and few have sympathy because the homes are so valuable on paper. Frequently, Cullion said he and others like him are told they should just sell, but it means abandoning the neighborhood they worked so hard to make a special place – like walking off the stage before the final act.
“I’m very frustrated at this point,” he said. “Nobody is listening to middle class people in this situation. Seniors are not part of the conversation unless they are poor. The South End will now be just rich and poor. We spent a lot of time living in a neighborhood that had serious issues and we helped to clean it up. Right now, I’m looking at other places to live and I’m not happy about it. My friends are here and my family is close by, but I’m 67 and this has to last me until I’m 92 or 95. That won’t happen with these kinds of tax bills.”
Those looking for programs that can help with Assessing are advised to call the TRAC office at City Hall, (617) 635-4287. The Age Strong Commission is also another resource to consult before making big decisions, Shea said.
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