Property taxes in Chicago nearly doubled since 2010

Lower income residents, tenants, most affected

Chicago /
Feb.February 04, 2022 02:45 PM

(iStock/Illustration by Steven Dilakian for The Real Deal)

The 5 percent property tax increase expected in Chicago will primarily affect lower income residents and tenants, Illinois Policy reports.

That’s part of a years-long trend of property tax bills increasing faster than home values and incomes, which hurts lower income residents more than wealthy ones, because homes valued in the bottom 10 percent are paying an effective tax rate that’s more than double that paid by the top 10 percent, according to a report from UChicago News cited by Illinois Policy. A rise in inflation further hurts low income residents’ ability to pay taxes.

Chicago collected more than $1.4 billion in property taxes in 2020, nearly double the $754 million it collected in 2010.

Landlords will be insulated from the hike, as they tend to pass the increase on to their tenants, according to research cited by Illinois Policy. Many tenants have been priced out of homeownership due to housing shortages, bidding wars and rapid housing price increases.

Property taxes have been a point of contention in Chicago for some time now. Cook County Tax Assessor Fritz Kaegi has frequently been in the public eye for reforming the property tax system, which appears to have benefitted commercial landlords at the expense of homeowners for years, according to tax analysis.

City politicians drew criticism from some economists in October when they voted to raise property taxes by $23 million, a figure which they based on the national inflation rate instead of a local one. Nationally, prices were rising by 5.4 percent last October, compared to 4.5 percent in Chicago. Inflation lagged locally because rents and home prices were increasing less dramatically than in other parts of the country.

[Illinois Policy]





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