Assessment Inequity in a Declining Housing Market: The Case of Detroit

22 Pages Posted: 19 Apr 2017

See all articles by Tim Hodge

Tim Hodge

Ford Motor Company

Daniel McMillen

University of Illinois at Urbana-Champaign - Department of Economics

Gary Sands

Wayne State University - College of Urban, Labor, & Metropolitan Affairs

Mark Skidmore

Michigan State University - Department of Agricultural Economics

Date Written: Summer 2017

Abstract

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).

Suggested Citation

Hodge, Tim and McMillen, Daniel and Sands, Gary and Skidmore, Mark L., Assessment Inequity in a Declining Housing Market: The Case of Detroit (Summer 2017). Real Estate Economics, Vol. 45, Issue 2, pp. 237-258, 2017, Available at SSRN: https://ssrn.com/abstract=2954808 or http://dx.doi.org/10.1111/1540-6229.12126

Tim Hodge (Contact Author)

Ford Motor Company ( email )

1 American Road, 233
Dearborn, MI 48121
United States

Daniel McMillen

University of Illinois at Urbana-Champaign - Department of Economics ( email )

410 David Kinley Hall
1407 W. Gregory
Urbana, IL 61801
United States

Gary Sands

Wayne State University - College of Urban, Labor, & Metropolitan Affairs ( email )

Detroit, MI 48202
United States

Mark L. Skidmore

Michigan State University - Department of Agricultural Economics ( email )

East Lansing, MI 48824
United States

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