States Take Action On Property Taxes As Home Values Soar 54%

When Carol Shepard bought her modest three-bedroom home in a quiet Denver suburb in 2018, she never imagined she’d be losing sleep over property taxes. However, as her home’s value has surged nearly 40% in just five years, so has her anxiety about the mounting tax bill.

"It feels like I’m being punished for my home doing well," Shepard, a 47-year-old teacher, told Benzinga. "I love my neighborhood, but I’m worried about being priced out of my own home."

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Shepard isn’t alone. Across the country, homeowners are wrestling with a double-edged sword: soaring home values that have boosted their equity, coupled with ballooning property tax bills that are straining their budgets. Now, lawmakers in several states are scrambling to address the issue, with solutions ranging from targeted relief to radical overhauls of the entire property tax system.

This November, voters in at least seven states will face ballot measures to reform property taxation. The initiatives come as tension grows between cash-strapped local governments and homeowners feeling the pinch of appreciating real estate markets.

In Colorado, where Shepard lives, voters will consider a measure to cap annual increases in property tax revenue. Georgia is mulling a similar proposal to limit assessment value hikes.

But the most dramatic reform is on the table in North Dakota. There, a grassroots movement is pushing to abolish property taxes entirely.

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"Do you really own your property if the government can come in and take it from you?" asked Rick Becker, a former GOP state representative leading the charge. His group argues that property taxes are at odds with personal freedom and true ownership.

Critics, however, warn that drastic measures could harm local services. Property taxes, after all, pay for many community functions, from schools to firefighting.

"Our coalition's not coming together to say that property taxes are perfect, and nothing should be done," said Chad Oban, who heads Keep It Local, a group opposing North Dakota’s measure. "Our coalition is basically saying this isn't a solution."

Other states are taking a more measured approach. Kentucky is exploring exemptions for homeowners over 65, while Virginia and New Mexico want to expand property tax breaks for veterans.

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The efforts echo California’s landmark Proposition 13 of 1978, which capped property tax increases and sparked a nationwide anti-tax movement. 

As states wrestle with the thorny issues, they’re walking a tightrope. Cut too deeply, and essential services suffer. Don’t cut enough, and homeowners like Shepard may find themselves priced out of their communities.

"All of these proposals are really about what the desired level of overall taxation is and who has to pay it," said Danielle Hale, chief economist at Realtor.com. "Homeowners should remember, and many do remember, that you're paying property taxes to fund local services, including things like schools, libraries, parks, and local facilities that can make a community a great place to live."

Back in Denver, Shepard is watching the upcoming vote. "Something needs to change," she said to Benzinga. "I just hope whatever we do, we get it right."

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