Center for Policy Research
Property Tax Web Series
Are the Property Tax Burdens of Permanent Homeowners Affected by Growth in Housing Rentals and Second Homes: Evidence Based on Big Data from Florida
Keith Ihlanfeldt, Cynthia Fan Yang
January 2022
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Abstract
Homeowners who make their home their primary residence have resisted the entry of rentals into their neighborhoods and cities. One possible reason underlying this resistance is that rentals increase the property tax burdens of homeowners. We relate the effective tax rate and the tax price that homeowners pay for public services to shifts in their city's housing units in favor of rentals, broken down by type.
In addition to rentals, we also examine the fiscal impacts on homeowners from more housing units acting as second homes. Our analysis is based on an eleven-year panel of individual Florida homes, with the number of home/year observations in the millions. Our results show that single-family rentals and apartments increase effective tax rates and tax prices. Tax prices are also higher where single-family second homes are more prevalent.
This paper was presented by Keith Ihlanfeldt on January 21, 2022 as part of the 2021-2022 Syracuse Webinar Series on Property Tax Administration and Design.
This Syracuse-Chicago Webinar Series on Property Tax Administration and Design aims to gather insight and scholarship through domestic and international comparative studies with common threads to help reform and improve property tax administration and design in the U.S. and other countries facing similar problems.
For questions about the webinars, please contact Zia Jackson. For questions about this paper, please contact the author or authors.