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Assessment Inequity in a Declining Housing Market: The Case of Detroit
Author(s) -
Hodge Timothy R.,
McMillen Daniel P.,
Sands Gary,
Skidmore Mark
Publication year - 2016
Publication title -
real estate economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.064
H-Index - 61
eISSN - 1540-6229
pISSN - 1080-8620
DOI - 10.1111/1540-6229.12126
Subject(s) - property tax , economics , property value , quantile regression , payment , real estate , public economics , inequality , residential real estate , residential property , property market , estate , value (mathematics) , labour economics , tax reform , econometrics , economic geography , finance , mathematical analysis , mathematics , machine learning , computer science
We examine the degree to which assessment practices in the City of Detroit have created substantial inequities in property tax payments across residential properties. Two key contributions of this article include: (1) inequities created by assessment practices are examined in a collapsed real estate market, and (2) quantile regression techniques are used to determine how assessment practices have altered assessment distributions within and across property value groups. Results show that current practices have created a wide range of property tax payments across properties with similar value (horizontal inequity), and similar tax payments for properties of differing values (vertical inequity).