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.
The Pandemic Hangover Lingers on
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.
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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.
Where Property Taxes Have Outpaced Home Values the Most
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.
The second-biggest gap in the nation was reported by another Florida metro, Jacksonville, where property taxes rose 21.7 percent between 2022 and 2024, while home values only grew 8.1 percent.
In third place was Colorado’s Denver-Aurora-Centennial, where home values rose just 5.7 percent between 2022 and 2024, while property taxes climbed more than three times as fast, up 19.1 percent. This growth in property taxes can be traced back to the repealing of a law which allowed the state to split its property tax bill between residential and commercial properties along a fixed ratio.
Without that offset, voted down by voters in 2020, property taxes went up.
Another Colorado metro, Colorado Springs, is in fourth place with a gap of 12.6 percentage points between property tax growth and home value growth. Here, property taxes rose 17.3 percent between 2022 and 2024, while home values grew just 4.7 percent.
Tax bills have risen so significantly in the metro because El Paso County, home to Colorado Springs, reappraises properties every other year. The 2023 reappraisal occurred at the peak of the metro’s home value boom, sending taxes through the roof.
Rounding up the top five is Alabama’s Birmingham, where property taxes for the typical homeowner rose 17.6 percent between 2022 and 2024, while home values grew 6.6 percent. Despite the hefty increase, Birmingham homeowners paid $1,334 in property taxes in 2024—the lowest of any metro in the top five.
Newsweek contacted ConsumerAffairs for comment by email on Tuesday morning.
The Midterms Promise Changes for Some Homeowners
Voters in Florida will get the chance to vote on a proposed constitutional amendment that could dramatically lower property taxes for many homeowners in the state next month.
The proposal, known as Amendment 3, would increase the exemption on non-school property taxes from its current level to $150,000 in 2027 and $250,000 in 2028, while also reducing the cap on annual assessment increases for non-homestead properties from 10 percent to 5 percent.
Legally, a constitutional amendment in the Sunshine State needs the backing of at least 60 percent of voters to be introduced—meaning that the measure is facing something of an uphill battle to be passed.
Recent polls, however, suggest that the measure might overcome this high threshold. The latest NBC6/Telemundo Station Group poll, conducted by polling and strategy firm Mason-Dixon and released early this month, found that 55 percent of Florida voters support the proposal, while 26 percent oppose and 19 percent are undecided.
Should it be approved, however, the constitutional amendment will not come without consequences for local government's funding, according to experts and local leaders who have argued that it would threaten key services such as law enforcement.
Contact Newsweek editor on this story: Edward Pearcey.