When you’ve invested in real estate in Chicago, Illinois, you already know what kinds of benefits you’re getting. It’s a great city with lots to do, excellent restaurants and exciting sporting events. You can live near the water without the problems of hurricanes and you get to enjoy all of the seasons – from brisk falls to snowy winters, mild springs, and hot summers. It’s a place where many property search engines will guide you. However, you might be paying more for this
According to the Cook County assessor of taxes, your home or real estate property in Chicago is going to be worth anywhere from two to three times as much – but with that increased value comes increased taxes. In fact, the Civic Federation of Chicago actually estimates that real estate taxes will rise by about 36% for each and every property tax bill that you receive. That will add up to over $800 more each year.
But hope may still be on the horizon. Property in Chicago might be able to be protected from the full weight of this tax increase by the renewal of a homeowner’s protection bill. This bill alone would cut the tax increase to about $300. And that’s going to add up, considering how many homes have recently doubled and tripled their value, according to the assessor’s office.
On the other hand, if you are trying to sell your property in Chicago, this means that you’re in for a higher return on your investment property. By simply putting up your ‘For Sale by Owner’ sign, you’re going to be seeing buyers that want to live in Chicago and are realizing that they will have to spend more money to do so. Many homeowners are rubbing their hands together with the prospect of this increase on their investment, however, the housing bubble has yet to burst into seeing any financial rewards – they’ve only seen their house sit on the market, waiting for a bite.
Since the housing market has slowed, it seems that more investors in property in Chicago are going to have to worry about the increase in property taxes. What’s interesting about this development is that the assessor’s office is not going to reassess properties at this time, which means those people in the suburbs of Cook County may see their taxes be even higher than expected. Of course, in other years, these suburbs haven’t had to pay as much.
Fortunately, just because your property in Chicago may be assessed at 200% more than it was initially worth, these taxes will be spread out over the course of time, so it won’t be an all at once payment.
There is talk of a cap on the property taxes for those owning property in Chicago or real estate. The cap would bring relief to homeowners, but not to those that own apartment buildings or businesses. A study completed by the Illinois state revenue department shows the financial burden of increased property taxes (about $323 million) will be transferred from homeowners to commercial properties ($135 million), apartment building owners ($25 million), and other investors ($84 million) and miscellaneous homeowners ($79 million).
But the Civic Federation released a study finding owners of commercial, industrial and apartment property will actually see decreases in their tax bills, even if the cap is not renewed. This is because home values have risen at such a faster pace.
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Author
Carol McDonald