Many new homeowners and those with paid-off mortgages face unexpected financial strain. This strain comes primarily from rising property taxes in U.S. cities, where taxes now exceed home value growth rates.
Study Shows Disparity
ConsumerAffairs, a private marketplace, conducted a study finding that property taxes outpaced home value growth in 46 out of the 100 largest U.S. metropolitan areas between 2022 and 2024.
The Pandemic’s Impact
A surge in home buying during the pandemic led to significant home value increases. According to Brookings, the average U.S. home value increased by about $100,000 from 2020 to 2022. While this was positive for homeowners’ equity, rising home values also meant increased property tax bills.
ConsumerAffairs reports a 10.6% increase in median property taxes between 2022 and 2024, compared to a 12.4% rise in average home values nationwide. Added costs like home insurance, HOA fees, and borrowing expenses have compounded these challenges.
Regional Variations
A homeowner’s struggle with these financial pressures largely depends on their location. Analysis by ConsumerAffairs examined data from the U.S. Census Bureau, noting significant tax increases in certain areas.
“The 10 metros with the widest tax versus home value gaps are in the South or West,” noted researchers.
Top Areas with Tax Increases
Some states had multiple cities in the top ranking for largest discrepancies. Florida had three metros in the top 10.
In Florida’s Lakeland-Winter Haven, property tax bills increased 28.1%—triple the national average—while home values went up 14.2% in the same period.
Homeowners without mortgages experienced a 22.4% rise in property taxes, while those with mortgages saw a 31.5% increase. From 2019 to 2024, property taxes rose 78.6%, compared to a 74.1% rise in home values.
Jacksonville, Florida, reported a 21.7% increase in taxes and an 8.1% increase in home values.
Denver-Aurora-Centennial, Colorado, had home values increase by 5.7% but property taxes rose 19.1% due to changes in local taxation laws.
Colorado Springs followed, with taxes increasing by 17.3% compared to home values’ 4.7% rise, influenced by El Paso County’s biennial property reappraisals.
In Birmingham, Alabama, property taxes rose 17.6% compared to a home value increase of 6.6%. Despite the rise, Birmingham’s average property tax was the lowest in the top five.
Potential Tax Amendments in Florida
A constitutional amendment vote in Florida could lower property taxes. Amendment 3 proposes increasing the exemption on non-school taxes and reducing the cap on annual assessment increases. Approval needs at least 60% voter support.
Recent polls suggest potential voter support for the amendment. However, experts warn it may affect local government services.
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