Colorado Housing Hangover Saps Taxes
Colorado, Claire and Alan Pegg are in risk of losing their house in the Denver suburb of Brighton. Left with no income after their tree farm failed, Claire says she isn’t sure her family can keep the ranch-style house they’ve owned for eight years.
“We don’t have any savings and nothing to select from,” said Claire, a 39-year-old mother of two who voiceover work during the day and waits tables during the night. “If things go well for a long time we’ll get back on our feet, but when anything else happens we’ll be out.”
While housing prices within the Denver area bottomed out this past year and are now posting modest gains, a large number of homeowners are still held in homes worth under they paid, and foreclosures still sap property-tax revenue in hard-hit Denver suburbs, forcing their state to raise its share of funding for public schools in those areas and statewide.
Exactly the same factors are putting pressure on state governments and school districts nationally, because the lingering effects of the housing crisis are required to chill property-tax collections into the coming year and beyond. That’s because home values remain far below pre-crisis levels, and reassessments raising taxes lag behind upticks in property values by so long as three years.
“Property-tax revenues are projected to become essentially flat in the national level,” said Tony Yezer, a professor of economics in the Elliott School of International Affairs at Washington-based George Washington University. “That means in tangible terms, adjusted for inflation, they’re down. That’s very unusual.”
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