Published by REALTOR.com | April 6, 2023
Across the country, many homeowners are being squeezed hard by higher property taxes.
For the past few years, the spotlight has been on homebuyers and renters navigating the topsy-turvy housing market. Then the market shifted, and the focus began veering toward home sellers.
But what about homeowners?
Across the country, many homeowners are being squeezed hard by higher property taxes. Nationally, average property taxes jumped nearly 4%, to a total of $340 billion in 2022, according to a 2022 Property Tax Analysis report released by real estate data firm ATTOM. The increase was more than double the 1.6% growth in 2021, but smaller than the whopping 5.4% increase the prior year.
The report looked at property tax data collected from states, metropolitan areas, and counties. It also factored in the estimated market value of 87 million single-family homes.
“Two major factors, rising costs and higher inflation, are surely at work driving property taxes ever higher. A third factor could involve property tax bases dwindling following the coronavirus pandemic,” says ATTOM CEO Rob Barber.
Property taxes keep rising each year because employee salaries, building maintenance, equipment and supplies, and other costs related to government services and public schools went up with inflation.
“The average single-family tax bill around the country increased last year at close to twice the pace of the prior year,” says Barber. “That showed the pressures of inflation, rising costs, and the possible loss of commercial tax bases—all forces likely to continue through 2023.”
However, taxes could go down if home values fall as the housing correction continues. Home prices have already begun to dip in certain markets, particularly the ones that saw the largest run-ups in prices during the pandemic, as a result of higher mortgage interest rates. Those higher mortgage rates have made buying a home unaffordable for many Americans, leading to prices coming down a bit.
