One of the perks of homeownership is supposed to be that it allows you to have a bit more control of your housing costs over time — no surprise rent increases when you have a 30-year fixed.
But that stability is becoming less and less common with rising home insurance costs and, in some places, skyrocketing property taxes.
A recent analysis from LendingTree found that between 2021 and 2023, the most recent year data was available, median property taxes in the U.S. rose by an average of more than 10%. More than half of homeowners with a mortgage are paying more than $3,000 a year.
According to LendingTree, property taxes are up in all 50 of the largest metro areas in the country.
“Something like property taxes can make a house that looks like a bargain a little bit less so,” said Matt Schulz, the LendingTree’s chief consumer finance analyst.
The increases are mostly driven by the assessed value of properties going up, said Lucy Dadayan at the Urban Brookings Tax Policy Center.
“And it’s not surprising to see places seeing the highest tax increases as also the places that have seen high property value increases,” said Dadayan.
Places like Florida and Texas, for example, where tough competition for homes has pushed up prices and thus the taxes on the properties.
“And while many states and many cities have rolled back their property tax rates to account for this, most haven’t done it enough,” said Jared Walczak, vice president of state projects at the Tax Foundation.
When rates stay the same but the values of homes and the taxes on them go up, it means more revenue flowing into local governments, which can then be spent on things like roads and schools.
But Walczak said it’s effectively a tax hike people didn’t vote for.
“And legitimately, you have a lot of property owners asking why this is on autopilot and why they’re not seeing relief,” said Walczak.
Walczak said the last time we saw property taxes jump like this back in the ‘70s, voters revolted all over the country and passed a wave of laws to try to keep the increases in check.