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Baltimore CHAP Tax Credit: The Insider’s Track to Lower Housing Costs

By Thomas Carroll, REALTOR®

3127 O’Donnell’s
Dining Room

Hitting the market in Canton this weekend is 3127 O’Donnell Street, a newly renovated townhouse just steps from Canton Square. The modern fixtures added during the renovation pair nicely with the Victorian stained-glass windows and exposed brick walls. The blend of modernity and history will certainly make you feel at home. But when you look beyond the surface, you will find even more to be excited about.

Looking at the tax bill for this property, you’ll notice that the city credited the owner with $3018 last year, reducing the overall tax bill by well over 50%. What is going on here? That is known as the CHAP Tax Credit. Baltimore City began offering these in 1996 and buying a home with one of these in place is a great way to offset the recent spike in interest rates. For example, 3127 O’Donnell Street’s annual credit of $3018 translates to a monthly savings of $250 on your mortgage payment, assuming you pay taxes through escrow.

Baltimore’s CHAP tax credit program was started to incentivize property owners to do substantive renovations to their properties and requires that a minimum of 25% of the home’s current value be invested in the renovation. The work must meet Baltimore City’s guidelines and the application is quite extensive but once a CHAP tax credit is granted it is good for 10 years! For homeowners looking to do renovations this is a great way to subsidize the costs over the long run. But sometimes, life dictates that people must move and that is where these tax credits become a serious opportunity for home buyers because the full tax credit transfers with the property to the new owner!

So, if you are on the hunt of a new home, look for one of these diamonds in the ruff as a way of reducing your overall housing costs. On average, Baltimore City only grants around 200 of these credits per year so in a city with roughly 275 thousand homes, they are quite rare. If one comes to market in the area you like, do not let it pass you by. Your wallet will thank you!

If Canton happens to be an area of interest for you, take a look at 3127 O’Donnell Street. You can find more information about the home at its website: 3127 O’Donnell Street

If you have any questions of just want to talk real estate, please do not hesitate to reach out!

This entry was posted on Friday, June 24th, 2022 at 9:47 am. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.