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Landlords, Homeowners to See Further Property Tax Increases This Year

Economics

Landlords, Homeowners to See Further Property Tax Increases This Year


August 26, 2021
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Photo: Monster Ztudio | stock.adobe.com

The pandemic-fueled housing boom pushed up home values, prices, and property taxes, but the tax increases are expected to shock homeowners and landlords this year. Realtor.com says average property taxes paid increased 4% last year, but experts predict higher jumps this year. Many communities lost revenue last year and look to property taxes for needed funds. Areas in Alaska, Colorado, Georgia, California, and Washington have already seen the highest tax increases. Anchorage, AK paid 26.2% more in property taxes on average last year. The tax hikes will affect elderly residents, the unemployed, renters, and those struggling to balance inflation most.

Even tenants will pay the price, as at least a portion of those tax increases are expected to be passed down to them in the form of higher rents.

Average property taxes are lowest in the South, with Alabama coming in cheapest at an average of $841 a year paid in 2020, according to ATTOM. The highest are in the Northeast, California, and Texas, with New Jersey topping the list with a whopping average tax bill of $9,196. Taxes can be even higher in particular areas, such as Westchester County, where annual property taxes can easily top $24,000.

“Many of our clients who are older and living off of Social Security or pensions are beginning to wonder whether or not they’ll be able to remain in their homes as their property tax bills continue to rise,” says Frank DiZenzo, chief revenue officer of realAppeal.

However, higher taxes are not expected to hit all parts of the country equally—or all at the same time. Property taxes usually get collected by local jurisdictions (e.g., counties, cities, towns, school districts, or special districts like water authorities) to help pay for a myriad of services, from the fire department to police to the library. These jurisdictions follow different schedules for when they reassess home values and update tax bills.

Moreover, many states and counties offer ways to ease that tax burden, whether through property tax exemptions or relief programs for veterans, disabled people, or senior citizens.

Read More
 

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