Chicago Homeowners Face Record Property Tax Increase Due to Loop's Value Decline
In a startling turn of events for Chicago homeowners, the declining value of commercial properties in the Loop has led to an unprecedented 16.7% increase in the median property tax bill. This sharp rise, which translates to an average tax bill of $4,457, is the largest increase reported in over 30 years. The city's economic core, the Loop, has historically been a significant contributor to Chicago's property tax revenues, but a dramatic slump in commercial property values has triggered a domino effect on residential homeowners throughout the city.
According to an analysis conducted by Cook County Treasurer Maria Pappas, commercial property taxes in the Loop dropped by over $129 million for tax year 2024, a consequence of plunging property values among office buildings, retail stores, hotels, and restaurants. This decline in commercial tax contributions has shifted the financial burden largely onto homeowners, resulting in a staggering $469.4 million increase in residential property taxes compared to the previous year.
The implications of this tax shift have been particularly severe for homes located in less affluent areas, especially those predominantly populated by Black communities on the South and West sides of Chicago. Many of these neighborhoods experienced soaring home values post-COVID-19, which further exacerbated the impact of the tax increase. In some areas, median tax bills soared by over 50%, with specific communities like West Garfield Park witnessing increases of 133%, while neighborhoods such as North Lawndale and Englewood saw respective jumps of 99% and 82.5%.
Treasurer Pappas remarked, "When the Loop gets a cold, the rest of the city gets pneumonia," highlighting the interconnectedness of the city's commercial and residential property markets. Residents in struggling communities are left to bear the brunt of this fiscal crisis, raising concerns about their ability to keep up with skyrocketing financial demands.
Pappas’ analysis revealed that the tax burden is increasingly shifting from commercial properties to residential and industrial owners. Multifamily property owners are shouldering over $100.5 million more, while industrial property owners are paying $73.5 million extra compared to the previous year, all while commercial property owners collectively paid $134.4 million less. This transformation in the tax landscape accompanies an overall $528.6 million increase in city taxes, marking a 6.3% rise in total property tax revenue across Chicago.
For the homeowners in the southern suburbs, the situation, albeit still intense, brought a marginal respite. Following a record-high 19.9% median tax increase last year, these homeowners can now expect a comparatively modest uptick of 2.2% for 2024. Conversely, the more affluent suburbs farther north, recently undergoing reassessments, have experienced tax increases hovering close to 3.7%.
The overall situation across Cook County presents a grim yet telling picture of the local economy's challenges. Property taxes surged to almost $19.2 billion, up by 4.8%, significantly outpacing the general inflation rate of 3.5%. This continuous rise, now marking the 30th consecutive year, stems from escalating demands for financing from municipalities, school districts, and various local governing bodies, leading to heightened tax levies.
Residents who wish to gain timely access to their tax obligations can view and pay their taxes online at the Cook County Treasurer’s official site, allowing for partial payments.
According to an analysis conducted by Cook County Treasurer Maria Pappas, commercial property taxes in the Loop dropped by over $129 million for tax year 2024, a consequence of plunging property values among office buildings, retail stores, hotels, and restaurants. This decline in commercial tax contributions has shifted the financial burden largely onto homeowners, resulting in a staggering $469.4 million increase in residential property taxes compared to the previous year.
The implications of this tax shift have been particularly severe for homes located in less affluent areas, especially those predominantly populated by Black communities on the South and West sides of Chicago. Many of these neighborhoods experienced soaring home values post-COVID-19, which further exacerbated the impact of the tax increase. In some areas, median tax bills soared by over 50%, with specific communities like West Garfield Park witnessing increases of 133%, while neighborhoods such as North Lawndale and Englewood saw respective jumps of 99% and 82.5%.
Treasurer Pappas remarked, "When the Loop gets a cold, the rest of the city gets pneumonia," highlighting the interconnectedness of the city's commercial and residential property markets. Residents in struggling communities are left to bear the brunt of this fiscal crisis, raising concerns about their ability to keep up with skyrocketing financial demands.
Pappas’ analysis revealed that the tax burden is increasingly shifting from commercial properties to residential and industrial owners. Multifamily property owners are shouldering over $100.5 million more, while industrial property owners are paying $73.5 million extra compared to the previous year, all while commercial property owners collectively paid $134.4 million less. This transformation in the tax landscape accompanies an overall $528.6 million increase in city taxes, marking a 6.3% rise in total property tax revenue across Chicago.
For the homeowners in the southern suburbs, the situation, albeit still intense, brought a marginal respite. Following a record-high 19.9% median tax increase last year, these homeowners can now expect a comparatively modest uptick of 2.2% for 2024. Conversely, the more affluent suburbs farther north, recently undergoing reassessments, have experienced tax increases hovering close to 3.7%.
The overall situation across Cook County presents a grim yet telling picture of the local economy's challenges. Property taxes surged to almost $19.2 billion, up by 4.8%, significantly outpacing the general inflation rate of 3.5%. This continuous rise, now marking the 30th consecutive year, stems from escalating demands for financing from municipalities, school districts, and various local governing bodies, leading to heightened tax levies.
Residents who wish to gain timely access to their tax obligations can view and pay their taxes online at the Cook County Treasurer’s official site, allowing for partial payments.
Topics General Business）
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