Rising property taxes are adding an unexpected financial burden to both new homeowners and those who have already paid off their mortgages, especially in the dozens of U.S. cities where they have now outpaced home values. A new analysis by ConsumerAffairs, a private, non-governmental marketplace, found that in 46 of the 100 largest metropolitan areas in the country property taxes have risen faster than home values between 2022 and 2024, leaving homeowners in these cities stuck in an uncomfortable position. Led by the homebuying frenzy triggered by historically low mortgage rates during the pandemic, the average value of a U.S. home rose by nearly $100,000 between 2020 and 2022, according to data cited by Brookings—equal to an asset value growth of nearly 17 percent per year, on average.
For those who saw their equity skyrocket within a few years, this increase in home values was great news; but it had a catch. Property tax bills, reflecting higher home values, also rose, though not as fast. According to ConsumerAffairs, the median property taxes paid by the average American rose by 10.6 percent between 2022 and 2024, while the average home value nationwide increased by 12.4 percent.
Other rising housing costs have contributed to make homeowners’ financial burden heavier since the pandemic, including higher home insurance premiums, homeowner association (HOA) fees, and borrowing costs. Overall, first-time homebuyers and seniors on fixed income are the ones struggling the most with these affordability challenges. But how much a homeowner is struggling also largely depends on where their home is located.
ConsumerAffairs researchers analyzed U.S. Census Bureau data, comparing the percentage change in median property taxes with the percentage change in median home value, to find that the 10 metros with the widest tax-versus-home-value gaps are all in the South or West. A few states have multiple cities among the top 10 metros with the widest gap between property tax growth and home value growth, topped by Florida with three metros.
Colorado and California each have two. Florida’s Lakeland-Winter Haven metro had the widest gap in the country, with the typical homeowner’s property tax bill jumping 28.1 percent, nearly triple the national increase of 10.6 percent. Within the same period, home values went up by 14.2 percent, also higher than the national average.
Specifically, the median property taxes paid by homeowners without a mortgage rose by 22.4 percent between 2022 and 2024, while it surged by 31.5 percent for homeowners with a mortgage. A wider time frame shows an even starker jump in property taxes: between 2019 and 2024, they rose by 78.6 percent, while home values increased by 74.1 percent. But the gap between property tax growth and home value growth is smaller, showing that the divergence between the two is a relatively new trend.
Extract — continue reading at the source.
