Historic Property Myths and Truths

 Daina Penkiunas  |    December 06, 2005

More than 23,000 Wisconsin buildings have been listed on the National Register of Historic Places since 1966. Listing can have real economic benefits for owners by increasing property values and providing significant tax breaks. In addition, owners of listed properties can take pride that they own an important piece of history.

Despite the long and successful presence of the National Register program, negative information circulating about the effects of listing is often based on hearsay and not on facts. As a real estate agent, you can sell those historic properties by helping prospective buyers separate fact from fiction and by showing them how to make historic building status work in their favor.

For instance, owners of listed properties can recover 25 percent of certain rehabilitation costs as tax credits if they get their project pre-approved.

Does listing in the National Register mean that a property can never be changed?

For private property owners, listing in the National Register in Wisconsin does not restrict what they do with their property or its present or future use. Listing does not mean that people can never remodel their bathroom or that a house must be painted a certain color. Many listed buildings have new additions and have incorporated modern conveniences and technology. Listed schools and factories have been transformed into apartments and listed depots into restaurants and offices. Some listed properties are frozen in place and time as museums, but these are only a tiny fraction of the buildings in the state that have this designation. Most historic buildings continue to be changed and adapted by their owners to meet current needs and lifestyles.

But, it can’t be torn down, right?

National Register listed properties are lost each year to demolition. In the case of privately owned buildings, municipalities are required to hold the demolition permits for 30 days and to notify the State Historic Preservation Office to allow the building to be photographed before demolition. Demolition cannot otherwise be delayed or regulated by the state or the federal government. In all cases of construction, remodeling, or demolition, local zoning, review and permitting procedures must be followed.

Does listing raise property taxes?

Listing does not automatically trigger an increase in property taxes, nor does it lead to lower property values. Houses listed in historic neighborhoods tend to have at least stable, but usually increasing property values. In many communities, National Register listed neighborhoods (called historic districts) are a highly desirable realty niche attracting buyers looking for well-maintained and well-preserved historic period homes. In many cases, a proposed historic district is already recognized as a highly marketable location with unique characteristics. The National Register listing is a formal recognition of the special qualities of the neighborhood. In the case of commercial districts, National Register listing can be a catalyst for physical improvements to buildings, leading to a more vibrant and commercially viable downtown.

If someone owns an older building, are they automatically eligible to participate in the National Register program?

Not all old buildings are eligible for listing in the National Register. Listed buildings are the best examples of their kind, retaining historic materials and their original character. The standards are somewhat lower in historic districts where buildings are judged as part of a neighborhood or a downtown, rather than individually.

Then, an owner shouldn’t apply unless their house is a mansion.

The National Register recognizes the individual importance of each property. One house may be eligible for listing because it is the best example of a Tudor Revival manor in a community, while another, very modest house may be eligible because it was the long time home of a noted writer. The National Register recognizes our broad history, from entertainment to education, from agriculture to industry.

If a property is listed, is there government money to restore it?

While there are limited and highly competitive grants available for units of government and non-profits, there are no government grants for private owners. However, National Register status does make owners eligible for tax credits that can make the rehabilitation and maintenance of historic properties highly desirable. For income-producing properties, the federal government offers a 20 percent credit on approved rehabilitation work for owners qualifying for the program. The state of Wisconsin is very generous and provides a 5 percent piggyback for the program when the work is pre-approved. Owners of historic commercial real estate spend about $2 million each year through the commercial tax credit program. The state also has a 25 percent rehabilitation income tax credit for pre-approved work for owners of qualifying residential properties, who invest about $6 million in updating their homes using the program.

So what does National Register designation mean?

For private individuals, the National Register is primarily an honor bestowed by the state and the federal government. It formally certifies what many in the community already know, that a building, a neighborhood, or a downtown is important to the history and character of their town. For those who chose to use the rehabilitation tax credit programs, National Register listing puts money back into their pockets when they rehabilitate a building and meet work standards. So, the next time a buyer or seller asks you about historic properties, be a historic preservation myth buster and give your client the facts about National Register listing.

Daina Penkiunas is National Register Coordinator for the Wisconsin Historical Society.

For more information about the State and the National Register program in Wisconsin
visit www.wisconsinhistory.org/hp/register/index.asp. More information on the rehabilitation income tax credit program is available at:

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