Property taxes a hot topic in Phoenix
Phoenix homeowners are going to be voting on Proposition 117, a bill which some are supporting because it alleviates major fluctuations in property taxes. Owners of real estate in Phoenix recently saw an average of an $18 drop on their property-tax bills, according to The Arizona Republic.
Proposition 117 limits the annual property value increase to 5 percent. In Arizona, all property is assessed annually at its full cash value to determine the taxation, which is based on an approximation of the market value on a home.
According to a recent report from S&P/Case-Shiller Home Price Index, average home prices increased by 2.2 percent month-over-month in Phoenix. Average home prices in the Valley of the Sun jumped significantly from their rock-bottom averages, and area homes have consistently posted positive gains since the end of 2011. Since the bursting of the housing bubble, Phoenix prices rose 17 percent.
"The news on home prices in this report confirms recent good news about housing," David Blitzer, chairman of S&P's index committee said. "Single family housing starts are well ahead of last year's pace, existing home sales are up, the inventory of homes for sale is down and foreclosure activity is slowing."
President of the business-oriented Arizona Tax Research Association, Kevin McCarthy said that the new bill would protect homeowners from huge tax increases on their home, when in some cases they cannot afford it. Homes in Phoenix dropped dramatically after the housing burst, and those who were able to purchase since then likely got a home for much less than it is currently worth.
However, Lynne Weaver, head of Prop 13 Arizona believes there is a better solution for the city. Her bill would decrease home values to where they were prior to the real estate boom and limit tax increases to no more than 2 percent per year.
Currently, property taxes in Phoenix are very complex and represent a wide variation that could shift depending on the neighborhood an individual lives in, according to The Republic. For example, the property tax bill for a home in Gilbert was $2,821 last year, and $3,046 this year. The property taxes on a home in a retirement community in Mesa went up $400 from last year to $1,262, and a bill on a home nearby went down $64 to $860.