We bought a house in 1971 for $59,000. The property taxes were $2,700 a year. We lived there until 2018. We sold the house for a little over $500,000. In 2026 that property is assessed at $483,000 and the taxes are $15,000 a year. The average annual increase in property taxes is about 3.17%.
Over the same period (1971 to 2026), the average annual U.S. inflation rate (measured by the Consumer Price Index, or CPI) was approximately 3.92% per year.
Over 35 years tax increases did not outpace inflation.
A similar pattern of property tax changes will continue in the future. For sure we know they will increase. If we had stayed in that house in retirement, the tax bill would not be an afterthought. My retirement would have to consider that expense and the likely increases.
That scenario applies to anyone with a house who retires. People routinely factor inflation in retirement planning. Certainly property taxes are significant in that planning. There are no surprises here.
They had $X income before retirement and paid their bills including taxes. They have $X income after retiring and still must pay their bills. There is no shifting insurance premiums, or car payments or any other bills to younger families. Why should property taxes be different? Upon retirement adequate income is necessary or lifestyle adjustments must be made. That is applicable at virtually any income level.
The other argument goes that survivors (typically widows) have a harder time paying the taxes because of reduced income. If we learn anything from participating on HD, it’s about planning for the vicissitudes of life, survivor income is part of that planning – I hope. I know many on HD delay SS for that reason, more income for a surviving spouse.
The current popular focus on property taxes is a red herring, it’s popular to rant against any taxes – without considering the consequences to the local community and beyond.
Unfortunately, the anti-tax argument greatly overstates the amount of taxes involved in most parts of the country and also the number of foreclosures that result in anyone losing their property – which is less than 1% and it is even rarer that a persons personal residence is involved.
That is not harsh, its reality.
The property tax is easy to quibble over since it is announced each fall as a lump sum (at least it is where I live) and even though many pay monthly through escrow they still see it as a large amount. Over the years it seems like a very large amount when someone stops to think about what they paid the first year they moved in. Hence the griping begins. It’s the same with the cost of groceries. I complain when I get a few small bags out of the trunk after going to the store and the bill was 60 bucks and I remember the amount of groceries my mother would bring in for 20 bucks.
It’s the incredible shrinking dollar that makes us complain so much. We just see it in everyday expenses.
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Has there ever been a time anywhere when prices did not increase? When I started driving gasoline was $0.25 a gallon.
People seem to forget that property taxes go up because the cost of services taxes pay for go up, like teacher and other employee salaries and benefits.
I just voted on a $41 million bond issue for school renovations, maintenance and improvements. No doubt that will appear in a future tax bill.
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No brainer. If you don’t want to pay property tax, rent. About 34% of US households do.
Just kidding. Of course you have to pay, and should.
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