To get the most from your investment, don’t just make sure your home is registered historic. Finding out as much as you can about your house’s history would boost its value and put your precious possession into the right hands, attracting a buyer who might be passionate about preserving the historical nature of the home.
Residential properties with rich pasts have great appeal to potential purchasers, who could benefit from tax incentives.
New Orleans has an abundance of historic neighborhoods and homes to choose from. From Uptown to the French Quarter, the city lives and breathes history. You can own a beautiful, centuries-old property in any number of architectural styles, from a classic Creole shotgun in the Bywater to an interesting camelback in the Irish Channel to the resplendent Garden District mansion.
In fact, New Orleans boasts 18 historic districts, so the chances of owning a historic house here are higher than in most U.S. cities. But what if you’re not buying but selling a historic New Orleans home? Besides being aware of your rights and your responsibilities to the government, to your potential homebuyer, and to history, there are a few considerations that would help you sell your historic property to the best buyer, yielding the highest price, and using the most efficient process.
Add History to Your Home’s Value
There are many factors that determine a home’s value — its size, style, condition, location — the list goes on. But if you’re selling a historic home, its past is an added value. However, for a home to be considered historic (and qualify for tax breaks) it must meet specific standards. Just the fact that it was built years ago is not enough. If the home is not in a recognized historic district, or is not recognized by the National Register of Historic Places or the National Trust for Historic Preservation, it may not be considered historic.
The Historic District Landmarks Commission, which enforces regulations concerning the preservation of historic properties and neighborhoods in New Orleans, is an essential resource. The agency will ensure your property’s compliance with historic district regulations, depending on whether the property is in a full-control or partial-control historic district. These regulations could cover new construction, exterior and interior renovations, and more.
You can also take advantage of the free pre-sale inspections the commission offers to real estate agents, sellers, and buyers. Not only will an inspection ensure you’re compliant, but it might help you determine the house’s true value.
Know the History (and Share With Potential Homebuyers)
To get the most from your investment, don’t just make sure it’s a registered historic home. Finding out as much as you can about your house’s history would boost its value and put your precious possession into the right hands, attracting a buyer who might be passionate about preserving the historical nature of the home. New Orleans has a wealth of resources when it comes to historic preservation, and your options aren’t limited to a DIY online search (although if you know where to look it might be enough these days, as quite a few local archives have been digitized).
Your best bet would be to start with tracing the chain of title (ownership history) and proceeding with finding out as much as possible about the historical significance of your home, including any tidbits about previous owners, architectural style, or local lore. Here are our recommended starting points:
- Historic District Landmarks Commission
- Vieux Carre Commission
- The Historic New Orleans Collection and its treasure trove of an archive at the Williams Research Center
- Notarial Archives
- Civil District Court’s Registrar of Conveyances Office (where the records date to 1827!)
- Civil District Court
- Orleans Parish Assessor’s Office
- New Orleans Public Library’s Louisiana Division and its real estate transfers data service, Deedfax.
Show It Off
With the history and character embedded in its very bones, a historic home could be easier to stage and market than your average modern house. Chances are the potential buyer has done his or her homework, is well-informed, and is attracted to the same features that made you appreciate the property in the first place. The story of the house should sell itself, but it’s worth it to emphasize its best points in both in-person showings and virtual tours (or however you choose to market your home online).
Proceed With Caution on Repairs
If you own historic property in New Orleans, you already must be compliant with the local preservation guidelines. But if you’re tempted to make any repairs, upgrades, or restorations before you sell, revisiting the restrictions is advisable, as is hiring expert professionals and preservationists to assist you.
In other words, proceed with caution and don’t sidestep any rules, even if it concerns a seemingly innocuous paint job, or installing a modern appliance. Historic houses in New Orleans come with specific sets of regulations and their own needs and challenges. The best way to keep expectations realistic and up to code is to do your homework and listen to the professionals. If you do decide to make any repairs or upgrades, hiring a contractor experienced in dealing with historic properties in Louisiana might be a wise move.
Understand Available Tax Incentives for New Orleans Buyers
Being well-versed in the federal and state tax incentives for historic preservation available to potential buyers can also expedite the sale. While tax rules can be complicated (for instance, some incentives include owner-occupied homes while others apply only to investment properties), it’s worthwhile to be aware of the potential financial rewards and share those with the potential buyers.
Historic preservation of properties is encouraged on both state and federal level, with tax incentives ranging from credits and deductions to decreased estate and property taxes.
The federal Historic Preservation Tax Incentives program offers tax credits equal to either 10% or 20% of qualifying renovation costs for investment properties only (one or the other, but not both):
- The National Park Service must approve the property as certified historic or in a historic district to qualify for the 20% tax credit, via the state historic preservation office. Renovation expenses must total at least $5,000, and your home must be at least 50 years old, along with other qualifications that render it historically significant.
- Any nonresidential structure that was built before 1936 but doesn’t qualify for the 20% credit can get 10%.
On the state level, Louisiana offers two historic rehabilitation tax credits through its Division of Historic Preservation:
- The 25% State Commercial Tax Credit Program (“income-producing” commercial buildings only)
- The 18.5% State Residential Tax Credit Program (this one is for owner-occupied historic structures).
Enlisting the help of a knowledgeable real estate agent can help you sell your historic property. Contact us a Satsuma Realtor and we’ll guide you in the process from start to finish, to get you the price worthy of your home’s value, and to make sure your historic home lands in the best hands.