Georgia Homeowners Pay a Median $2,027 per Year in Property Taxes
Thursday, March 23rd, 2023
America’s homebuyers have had an extraordinarily difficult few years. Heavy demand and scarce inventory in late 2020 and 2021 led to record growth in prices, while a run of high inflation throughout the economy made it more difficult to save up for a home. As the Federal Reserve has raised interest rates to cool demand in housing and other sectors, the costs to borrow for a mortgage have also increased.
For recent homebuyers and existing owners, trends in the real estate market have posed another challenge: property tax increases. Property taxes are usually calculated as a percentage of the assessed value of a property, an estimate that taxing authorities typically update every few years or when the property is sold. Because home prices have risen so dramatically since 2020, tax assessments are rising as well—which means larger annual property tax bills.
Higher property taxes can be daunting for homeowners, but they are a boon for state and local governments that rely heavily on property tax revenue. Property taxes totaled nearly $670 billion in 2021, representing more than one-third of all U.S. state and local tax collections. Rising property values should continue to grow that figure in future years. This could also help state and local governments weather the impacts of future economic downturns, which tend to have more immediate negative effects on other revenue sources like income and sales taxes.