By Eric Berman, REALTOR® | The Eric Berman Team at Compass
TL;DR:
Housing is genuinely cheaper and you get considerably more land — but Vermont is not a low property tax state. Effective rates are among the higher ones in the country, driven by a statewide education property tax, and the bill is lower than Nassau County's mainly because values are lower. There's also a filing most new owners don't know about: Vermont residents declare their homestead annually, and the declaration determines whether the property is taxed at the homestead education rate or the higher nonresidential one. Two more things matter if you're buying rural land — wastewater permits and whether the acreage is enrolled in Current Use.
Start With the Long Island Sale
At 250 to 350 miles this is a medium-distance move, close enough to visit during a search and far enough that coordinating two closings is impractical.
Before touring anything, know what the current home nets — commission, New York State Transfer Tax at four dollars per thousand, attorney fees generally $1,500 to $3,500, preparation, and carrying costs. The full breakdown of what a Long Island sale costs covers each line.
A seller who establishes Vermont residency before the Long Island closing becomes a New York nonresident for that transaction, triggering Form IT-2663 — an estimated payment at closing of 8.82 percent of net gain. A prepayment rather than an additional tax, refundable where the real figure comes in lower, but it reduces the wire.
For a long-held home, the exclusion covers $250,000 single and $500,000 filing jointly, and improvement records reduce taxable gain substantially. The full treatment of how gain is calculated covers the mechanics.
Vermont Is Not a Low Property Tax State
This is the correction most worth making, because rural and cheap get conflated.
Vermont's effective property tax rates are among the higher ones in the country. The state funds education substantially through a statewide education property tax, which is the largest component of most Vermont bills and the reason the rates run high.
A Nassau County seller will still likely pay less in absolute dollars — Vermont home values are lower, and a high rate on a lower value produces a smaller bill. But that's a different claim from "low property taxes," and a buyer planning around the latter will be surprised.
The filing that determines your rate. Vermont taxes property at either a homestead education rate or a nonresidential rate, and which applies depends on an annual homestead declaration filed by the owner. A resident who fails to declare can end up taxed at the nonresidential rate on their own home.
That's a recurring obligation rather than a one-time step at closing, and nobody sends a reminder. Ask a Vermont accountant or the town what the declaration requires and when it's due, and put it on a calendar.
Vermont also offers an income-based adjustment for qualifying residents, with its own eligibility rules and filing requirements. That's a CPA question.
And the property transfer tax is buyer-paid in Vermont — unusual among the destinations in this series, most of which put it on the seller. It's a closing cost a New York buyer won't expect, since New York buyers pay none. Rates and any reduction for a principal residence should be confirmed locally.
Rural Property Has Its Own Questions
Two items that a Long Island buyer has no framework for, and both matter more the further from town you go.
Wastewater and potable water supply permits. Vermont regulates these at the state level, and a property's permit status is a genuine transaction item — particularly for anything on a septic system and a well, which describes most of rural Vermont. Whether a valid permit exists, what it authorizes, and whether the existing system matches it are questions to ask before an offer.
A home whose permit doesn't reflect what's actually there is the Vermont version of the certificate of occupancy problem covered in the Port Washington permit content — the same dynamic, a different authority.
Current Use. Vermont's use value appraisal program allows qualifying agricultural and forest land to be assessed at its use value rather than its market value, substantially reducing the tax bill. Enrolled land carries obligations, and withdrawing land from the program triggers a land use change tax.
For anyone buying acreage, the questions are specific: is any of the land enrolled, what does enrollment require going forward, and what would it cost to develop or subdivide a portion later. That last one can be substantial and it's invisible in a listing.
Ask both questions before offering, not during due diligence.
Closings Will Feel Familiar
Attorney involvement in Vermont residential closings is standard practice, which makes the process recognizable to a New York seller.
That puts Vermont alongside New York, Illinois, South Carolina, Delaware, and Rhode Island among destinations where a buyer won't find themselves at a closing table with nobody on their side — as opposed to the escrow and title-company states where representation has to be arranged separately.
Two attorneys are needed rather than one, since licensing is state-specific. The fuller picture of what the attorney handles on the New York side describes the role that carries over.
Vermont also uses its own disclosure practices and inspection conventions, which differ from New York's. Worth understanding before signing rather than during.
Practical Logistics
Winters are the real adjustment, and they're longer and heavier than Long Island's rather than simply colder. Practical consequences: heating costs, which for an older home with poor insulation can be substantial; vehicle capability; and in rural areas, backup heat and power, since outages last longer where lines serve fewer people.
Ask for twelve months of utility bills on any specific property. A drafty farmhouse and an insulated newer build in the same town can differ enormously.
Internet access varies considerably, which matters for anyone keeping a New York-based position. Confirm what's actually available at a specific address rather than what's advertised for the town.
Distances are real. Groceries, medical care, and services may be considerably further than a Long Island household is used to, and that shapes daily life more than most people anticipate before moving.
On sequencing: selling the Long Island home first produces clean funds, a defined budget, and a purchase offer with no contingency. Buying first means carrying both properties, frequently $12,000 to $16,000 monthly combined at Long Island price points.
A Worked Example
Consider a composite case — a Nassau County household relocating to central Vermont for remote work, selling a colonial that comped near $1,040,000 and buying a farmhouse on eleven acres at roughly $520,000.
Three things they learned by asking. The property's wastewater permit didn't match the septic system actually in place, which their Vermont attorney caught and which became a negotiated item rather than a post-closing discovery.
Part of the acreage was enrolled in Current Use, which they hadn't known and which meaningfully affected the tax bill — favorably, provided they kept it enrolled. Their attorney explained what withdrawal would cost if they ever wanted to build on it.
And they learned about the homestead declaration in the first year rather than the second, which is the difference between the correct rate and the nonresidential one.
On the New York side they sold first. Their attorney's early title review turned up an unclosed 2011 permit for a rear deck, resolved in five weeks before listing.
Where to Start
Build the net-proceeds model on the Long Island home and sell first. Call the town or village building department about permits. Engage a New York real estate attorney early and talk to a CPA about IT-2663 and capital gains before setting a closing date.
On the Vermont side: pull the actual current property tax bill and understand which education rate applies. Find out what the homestead declaration requires and when it's due, and calendar it. Ask whether a wastewater and potable water supply permit exists and whether it matches what's on the property. If there's acreage, ask whether any is enrolled in Current Use and what withdrawal would cost. Get twelve months of utility bills. Confirm internet service at the specific address.
Sellers wanting a current read on where their Long Island home sits can start with a quiet look at present value.
The Honest Bottom Line
Vermont gives a Long Island household considerably more land and a genuinely lower housing cost, and for the right people it's a good trade.
What it doesn't give is low property taxes. The rates are among the higher ones in the country, and the bill is smaller mainly because the values are. Worth budgeting honestly rather than assuming rural means cheap.
And two things need asking before an offer rather than after: whether the wastewater permit matches the system that's actually there, and whether the land is enrolled in Current Use. Neither appears in a listing, and both cost real money to discover late.
For anyone working through what their Long Island home would net before any of that begins, that conversation is available whenever the timing suits.
This is general information, not legal, tax, or financial advice. Vermont property tax rates, homestead declaration requirements, transfer tax, wastewater permitting, and Current Use obligations vary and change. Confirm current specifics with a Vermont attorney, a CPA, and the relevant town and state agencies, and confirm New York specifics with a licensed New York real estate attorney.
FAQs
Are property taxes lower in Vermont than on Long Island?
In absolute dollars usually yes, and Vermont is not a low property tax state. Its effective rates are among the higher ones in the country, driven by a statewide education property tax that forms the largest component of most bills. A Nassau County seller will likely pay less because Vermont values are lower — a high rate on a lower value produces a smaller bill — but that's a different claim from low taxes, and a buyer planning around the latter will be surprised. Pull the actual bill for a specific property.
What is Vermont's homestead declaration?
An annual filing by which a Vermont resident declares their property as a homestead, determining whether it's taxed at the homestead education rate or the higher nonresidential rate. A resident who fails to declare can end up taxed at the nonresidential rate on their own home. It's a recurring obligation rather than a one-time closing step, and nobody sends a reminder. Ask a Vermont accountant or the town what it requires and when it's due, then calendar it.
What should I ask about a rural Vermont property?
Two things, both before offering. Whether a valid wastewater and potable water supply permit exists and whether the system actually on the property matches it — Vermont regulates these at state level and a mismatch is a real problem. And whether any land is enrolled in Current Use, the program that assesses qualifying agricultural and forest land at use value rather than market value. Enrollment reduces the tax bill and carries obligations, and withdrawing land triggers a land use change tax that can be substantial.
Does Vermont require an attorney to buy a home?
Attorney involvement in residential closings is standard practice in Vermont, which makes the process recognizable to a New York seller. It puts Vermont alongside New York, Illinois, South Carolina, Delaware, and Rhode Island among destinations where a buyer won't find themselves at a closing table with nobody representing them. Two attorneys are needed rather than one since licensing is state-specific. Vermont's disclosure practices and inspection conventions differ from New York's and are worth understanding before signing.
Who pays transfer tax in Vermont?
The buyer, which is unusual — most destinations a Long Island seller considers put it on the seller, and New York buyers pay none on a residential purchase. Vermont's property transfer tax applies at purchase with rates and any reduction for a principal residence set by statute. It's a closing cost a New York buyer won't have budgeted for. Confirm current rates and applicable reductions with a Vermont attorney before setting a closing budget.
By Eric Berman, REALTOR® | The Eric Berman Team at Compass
Eric Berman | Long Island & Queens Associate Broker | Compass
1468 Northern Blvd, Manhasset, NY 11030
(917) 225-8596 | eric@ericbermanre.com | theericbermanteam.com
