Property Tax Revenue Continues to Climb

2023-12-21T12:16:32-06:00

NAHB analysis of the Census Bureau’s quarterly state and local tax data shows that $129 billion in taxes were paid by property owners in the third quarter of 2023 (not seasonally adjusted).[1] In the four quarters ending Q3 2023, state and local governments collected $757 billion of property tax revenue—an 11.6% increase over Q3 2022. The year-over-year growth rate of property tax revenue (trailing four-quarter total) has climbed from 1.7% to 11.6% since Q1 2022. Growth has exceeded 10% for three consecutive quarters for the first time since 2009. Gains have been driven by rising home value assessments, which can lag market prices by one to two years. Property taxes accounted for 37.9% of state and local tax receipts for the four quarters ending Q3 2023, up slightly from 37.7% the prior quarter. The increase resulted from the combination of higher property and sales tax receipts with a 16.0% drop in individual income tax revenue and a 3.9% decline in corporate income tax collections. In terms of the share of total receipts, property taxes were followed by sales taxes (28.6%), individual income taxes (26.3%), and corporate taxes (7.2%). Individual income tax receipts accounted for their smallest share since 2011. The share of property tax receipts among the four major tax revenue sources naturally changes with fluctuations in non-property tax collections. Non-property tax receipts including individual income, corporate income, and sales tax revenues, by nature, are much more sensitive to fluctuations in the business cycle and the accompanying changes in consumer spending (affecting sales tax revenues) and job availability (affecting aggregate income). In contrast, property tax collections have proven relatively stable, reflecting the long-run stability of tangible property values as well as the effects of lagging assessments and annual adjustments. [1] Census data for property tax collections include taxes paid for all real estate assets (as well as personal property), including owner-occupied homes, rental housing, commercial real estate, and agriculture. Owner-occupied and rental housing units combine to make housing’s share the largest among these subgroups. ‹ Consumer Confidence Surged in DecemberTags: corporate income tax, home prices, income tax, individual income tax, property taxes, sales tax, state and local taxes

Property Tax Revenue Continues to Climb2023-12-21T12:16:32-06:00

Home Prices Continue to Rise in September

2023-11-28T11:18:42-06:00

By Jing Fu on November 28, 2023 • National home prices continued to increase in September. Despite rising mortgage rates, limited inventory and solid but weakened demand provided solid support for home prices. Locally, all of 20 metro areas had positive home price appreciation in September. The S&P CoreLogic Case-Shiller U.S. National Home Price Index, reported by S&P Dow Jones Indices, rose at a seasonally adjusted annual growth rate of 8.1% in September, slightly slower than a 9.8% increase in August. It is the eighth consecutive annual gain since February 2023. National home prices are now 69% higher than their last peak during the housing boom in March 2006. On a year-over-year basis, the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index posted a 3.9% annual gain in September, following a 2.5% increase in August. Meanwhile, the Home Price Index, released by the Federal Housing Finance Agency (FHFA), rose at a seasonally adjusted annual rate of 7.6% in September, following an 8.8% increase in August. On a year-over-year basis, the FHFA Home Price NSA Index rose by 6.0% in September, up from 5.8% in the previous month. In addition to tracking national home price changes, S&P CoreLogic reported home price indexes across 20 metro areas in September. All of 20 metro areas had positive home price appreciation. Their annual growth rates ranged from 1.9% to 18.9%. Among all 20 metro areas, 14 metro areas exceeded the national average of 8.1%. Las Vegas led the way with an 18.9% increase, followed by Detroit with a 17.1% increase and Phoenix with a 14.7% increase. The scatter plot below lists the 20 major U.S. metropolitan areas’ annual growth rates in August and in September 2023. The X-axis presents the annual growth rates in August; the Y-axis presents the annual growth rates in September. Nine out of the 20 metro areas, the dots above the blue line, had an acceleration in home price growth, while the remaining 11 metro areas, located below the blue line, experienced deceleration. ‹ Absorption of New Multifamily Units Rises as Completions Near 100K in Second Quarter of 2023Tags: FHFA Home Price Index, home prices, S&P CoreLogic Case-Shiller Home Price Index

Home Prices Continue to Rise in September2023-11-28T11:18:42-06:00

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