Renovating In Historical Districts

And renovating a home in a designated historical district makes the task even more formidable.

Dee Lanzalotti, a real estate broker, is quick to give potential purchasers in the town’s historic district a dose of reality. “A lot of buyers will come down and look at a house and say, ‘We can replace this with vinyl siding,’ But not here. It has to be wood,” said Ms. Lanzalotti, speaking of the Victorian houses that are characteristic to the district. “Anything to do with the exterior of the house is governed by the Historic Preservation Commission, from the fencing, the roofing, and the windows.”

Buying a property with a history and then renovating it, from building an addition to simply changing the color of the front door, can entail having plans approved by not only the town’s zoning board but also by a local historical preservation board.

The good news is that renovating a historical property can come with tax breaks. Though the 20 percent federal tax credit for a renovation on a qualifying historical home is reserved for investment properties, many states, including Michigan and Missouri, offer state income tax credits for improvements on primary and second homes. Additionally, most states offer some type of property tax incentive, such as a property tax freeze, on historical homes that have been restored.

A home may also be registered with a state historic register, and additionally, it can be submitted for inclusion in the National Resister of Historic Places, which includes some 81,000 listings of properties and historic districts and is overseen by the National Park Service.

While neither designation has any bearing on renovation restrictions, they do prevent the government from going forward with certain projects, such as a road widening or a new Interstate, that might compromise the property. “It is a way of protecting the homeowner,” said Gerry Kasper, a real estate agent who specializes in historic properties and owns historic homes. “Where you get constraints on homes is if the town enacts a historical ordinance,” he said. “A town could say any houses built prior to X year or a homeowner in a certain area needs to get a variance in order to do something to that property.”

Take Jan Jacobson’s rental property … The three-level house, built in 1794, was in need of a renovation in 2001 and Ms. Jacobson and her husband began the process to make improvements, including overhauling a restaurant on the first floor. The couple had to submit their plans to the local board. “They are pretty strict.” Ms. Jacobson said. “We didn’t do a thing to the outside of the building.”

It’s advantageous for quaint, tourist-popular towns to have such ordinances to protect their town centers, areas which which attract visitors because of their historical appeal. And typically their regulations apply only to the outside of the building.

In the village of Mendocino, Calif., about 150 miles north of San Francisco, the Mendocino Historical Review Board can dictate the type of windows, siding and even paint color on a house in the historical district. “You couldn’t paint something bright orange,” said Carol Greenberg, a Mendocino realtor, noting that she needed the board’s approval of a sign to hang outside of her real estate business when it opened last September.

And in areas without formal historic districts there are grassroots movements to slow the pace of teardowns.

In Finesville, N.J., there is an effort to create a historical district encompassing about 70 homes in the old mill town that date back to as early as 1750. With state recognition, the district can apply for inclusion in the National Register. The next step is going to the town board and proposing a set of rules that will limit what can be demolished.

In addition to protecting older homes from being torn down the effort aims to help ensure that the town maintains its open space. After all … New Jersey will pave over anything.