Cities across the U.S. are inflating property taxes assessed on low-value homes, according to a study from the University of Chicago which analyzed millions of real estate transactions and assessments.

[Read the study here.]

A growing chorus of experts and advocates have backed the results of the study, including economists, nonprofits and numerous legal and finance academics.

The research was originally produced last year by the University of Chicago.

Detroit Assessor Alvin Horhn called the study “invalid”, saying it used different methods for valuation than the city must use when assessing property taxes.

More from the University of Chicago:

The study finds that a property valued in the bottom 10% within a particular jurisdiction pays an effective tax rate that is, on average, more than double that paid by a property in the top 10%. This means that, on a nationwide basis, the lowest-income homeowners effectively subsidize the tax bills of their higher-income counterparts—fueling inequities across racial, economic, housing and other divides.

For example, properties located in neighborhoods that are 90-100% Black experience assessment levels that are more than 1.5 times the average for their county.


Using data from millions of residential real estate transactions between 2007 and 2017, Berry—who directs the Center for Municipal Finance and is the William J. and Alicia Townsend Friedman Professor at Harris Public Policy—developed the nationwide analysis and a new tool, searchable by county and city, which looks at property tax records for communities around the U.S.

The analysis compares assessed values with sales history and finds that lower-value homes were on average assessed at higher rates than higher-value homes. The interactive tool allows users to compare a particular community compares with others throughout the nation, and also provides a visual comparison of a community, county or state.