Dynamic Property Taxes and Racial Gentrification

24 Pages Posted: 23 Dec 2020

See all articles by Andrew T. Hayashi

Andrew T. Hayashi

University of Virginia School of Law

Date Written: December 18, 2020

Abstract

Many jurisdictions determine real property taxes based on a combination of current market values and the recent history of market values, introducing a dynamic aspect to property taxes. By design, homes in rapidly appreciating neighborhoods enjoy lower tax rates than homes in other areas. Since growth in home prices is correlated with – and may be caused by – changing neighborhood demographics, dynamic property taxes will generally have racially disparate impacts. These impacts may explain why minority-owned homes tend to be taxed at higher rates. Moreover, the dynamic features of local property taxes may subsidize gentrification and racially discriminatory preferences.

Keywords: property tax, race

Suggested Citation

Hayashi, Andrew T., Dynamic Property Taxes and Racial Gentrification (December 18, 2020). Virginia Public Law and Legal Theory Research Paper No. 2020-80, Virginia Law and Economics Research Paper No. 2020-21, Available at SSRN: https://ssrn.com/abstract=3751500

Andrew T. Hayashi (Contact Author)

University of Virginia School of Law ( email )

580 Massie Road
Charlottesville, VA 22903
United States

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