I had the opportunity to list my first "historic property" last year. Not being my expertise, I had a lot to learn. A phone call to my local Historic Preservation Department got me started. Wow, what an eye opener. For years, I had heard to stay away from these properties for a whole myriad of reasons. Most consumers as well as agents are scared away from the word GO. There is probably some small amount of merit there, but not much.

In the area where I live (Bend, Oregon), the historic district is held in high regard. A good portion of what is done here ensures the compliance and integrity of these neighborhoods. We can't have a freshly built condo in the middle of a row of 1940 homes, can we? So, as my journey began...I became acutely familiar with the vaious restrictions in place and the reasons why. For developers, investors  and "flippers", it may seem to be a lot of hoop-jumping. In fact, for anyone taking on the restorative process involved in these homes, it can definitely be a struggle. Working within historic district requirements can be difficult, but the challenge is not without reward. 

Outside of the obvious financial gains of these highly sought after properties, there are some other goodies that many brokers are not aware of. All states have a State Historic Preservation Office and this is your best bet for finding out what's available. In Oregon for instance, we have three programs that can make this process more desirable. The Preserving Oregon, Heritage and Certified Local Government Grants are all administered through the Heritage Programs Division. You can find more information on these programs at http://www.oregon.gov/OPRD/HCD/grants.shtml. 

Oregon also offers the "Historic Property Tax Incentive" outlined below  from the Oregon State Historic Preservation Office:

Historic Property Tax Incentives

SPECIAL ASSESSMENT

Financial incentives are important tools in encouraging the preservation of historic buildings. Oregon's Special Assessment of Historic Property Program, established in 1975, was the nation's first state-level historic preservation tax incentive.  It "freezes" a property's assessed value for 15 years.  It is most effective when the "freeze" starts before substantial rehabilitation work is undertaken that would otherwise increase the assessed value considerably.
 
Basic program requirements are as follows:

• The building must be on the National Register of Historic Places, either individually or as a contributing building in a historic district.
• A preservation plan must be prepared that outlines substantial rehab work the building will undergo during the 15-year period.
• There is an application fee equal to 1/3 of 1%  (0.0033) of the real market value.
• A four-hour public open house is required annually.
• An approved plaque must be installed on the building.
• State Historic Preservation Office (SHPO) approval is needed for exterior and interior work of any substance.

To receive the maximum benefit, your application must be submitted (even in draft form) BEFORE any rehabilitation is undertaken.  This helps assure that the "frozen" assessed value is the PRE-rehabilitation value.Additional program requirements are spelled out in the Fact Sheet and Handbook below.

WOW- Well that sure makes the process more appealing, doesn't it?

Offered in all states is the Federal Tax Credit Program. The Federal Tax Credit program is for income-producing buildings only (commercial and residential rental). It saves the property owner 20 percent of the cost of rehabilitation through a federal income tax credit. Nice perk. There are also programs to help fund the acquistion of these properties through the U.S. Department of Agriculture's Rural Housing Service and the FHA.

All in all, there is much to be said for preserving the historic districts of our beloved cities. It does requires some extra effort and in my case, a few dozen ibuprofen. However, the joy brought to a city of simple beginnings through acts of remembrance such as this is invaluable. They are a wonderful tribute to history and in my opinion, a necessary component. We have not only the power, but also a responsibility to keep our cities from getting swallowed up by development. I hope you will join me in doing you part to preserve what got us all here. For more information on your area, please reference the National Register of Historic Places at www.nationalregisterofhistoricplaces.com.