Black and Hispanic Homeowners Pay 10-13% More Property Tax Than White Homeowners on Identical Homes
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Holding property value, jurisdiction, and tax rate constant, Black and Hispanic homeowners pay 10-13% more in property taxes than white homeowners living in homes of the same market value. This translates to an extra $300-$390 per year per household. The mechanism is specific: mass appraisal models are less sensitive to neighborhood-level factors than the actual real estate market is. In majority-Black neighborhoods, market prices are depressed by racial bias in buyer behavior, but assessors don't fully adjust downward because their models smooth across larger geographies. So the assessed value overshoots the true market value. Compounding this, minority homeowners are less likely to file appeals, and when they do appeal, they win less often and receive smaller reductions. The structural cause is that assessment models are calibrated on aggregate sales data that bakes in the racial bias already present in housing markets, and no jurisdiction has implemented the small-geography home price index approach that researchers have shown would reduce this inequity by 55-70%.
Evidence
A Federal Reserve Bank of Minneapolis study covering 118 million homes found Black and Hispanic residents face a 10-13% higher tax burden for the same bundle of public services. Brookings Institution documented that this operates through both overassessment in minority neighborhoods and disparities in appeal success rates. University of Chicago research confirmed property tax burdens fall disproportionately on the nation's lowest-income homeowners. The Minneapolis Fed's working paper showed that an alternative assessment approach using small-geography home price indexes would reduce racial inequality by 55-70%. A Duke University/IPL seminar paper ('The Assessment Gap') quantified the racial inequalities in property taxation across jurisdictions.