Tampa, Miami, and Jacksonville have found themselves in the spotlight for a less-than-celebratory reason: a significant rise in property taxes since the onset of the pandemic.
A recent report sheds light on the rapid increase in property taxes across major metropolitan areas in the U.S., placing Tampa, Miami, and Jacksonville among the top regions experiencing this rise. The findings, provided by a tech real estate brokerage, compare various cities and reveal that Indianapolis leads with a staggering 66.7% increase in typical homebuyer’s property tax payments since 2019. Following closely is Atlanta, with a 65.8% hike. Yet, Florida’s hot cities are not far behind, showcasing hikes between 48.1% and 59.6%.
The report outlines three primary reasons that contribute to this surge in Florida. Firstly, the escalation in home values over the past five years due to a pandemic-driven buying frenzy, pushing more people to relocate from other regions, has led to higher assessed values. Although home prices have somewhat receded from their peaks, these assessed values remain inflated, consequently elevating tax bills.
Secondly, Florida’s commitment to climate-resiliency projects necessitates increased property tax rates. In states like Florida and Texas, where there is no state income tax, property taxes become crucial for funding essential projects.
Additionally, a burgeoning population in Florida demands more government services, like education and infrastructure, prompting municipalities to consider tax hikes. Inflation also plays its role, increasing costs for these services, according to the report.
Elijah de la Campa, a senior economist from the brokerage, pointed out the irony that Florida’s attractive, initially affordable housing market for remote workers during the pandemic has now driven up prices and, by extension, property taxes. This shift has placed homeownership out of reach for many local residents. De la Campa notes, “Homebuyers have realized they may save money by paying no income tax, but their property tax bill will increase.”
On a broader scale, the report highlights that across the United States, property taxes in dollar terms have climbed nearly 30% since 2019. The average effective tax rate has dropped slightly from 0.77% to 0.67%, as rising home prices outpace the tax rates set by local authorities.
The surge in property taxes in cities like Tampa highlights the complex interplay between rising home values, population growth, and climate initiatives. For many residents, this means navigating the challenges of increased taxes without the relief of state income tax, thus reshaping the landscape of homeownership in Florida.
Source: Businessobserverfl
