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

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Real Estate Economics

Published online on

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).