Fritz Kaegi has finally fixed Cook County’s broken property tax system
I’ve never been impressed with any of the politicians in Illinois, but Fritz Kaegi, Cook County’s assessor since 2018, is the exception to that rule. He inherited a seriously broken system from Joe Berrios and turned it upside down. I think the end result will be very good news for Chicago owners who should note that this guy is on the primary ballot on June 28.
Let me digress for a moment to those of you who think I’m crazy to deliver good news to homeowners in Chicago when you’ve just seen your assessed value increase by…whatever the percentage. First, I’m going to ask you if the taxable value is wrong. If it’s totally far-fetched, you should appeal and you’ll probably win. Otherwise, you deserve a higher assessed value. Second, I’ll remind you of something I’ve pointed out many times in these blog posts: an X% increase in your taxable value doesn’t mean your taxes go up by X%. The assessed values determine the allocation of the county and city budget, which are in no way influenced by the assessed values. In other words, if everyone’s assessed value increases by 75% and the budget stays the same, everyone’s property taxes stay the same.
Now back to the story. The assessor’s office was an abomination under Berrios. My blog posts about specific properties regularly called for property taxes that were grossly out of whack – almost always high-end properties assessed at a fraction of their market value.
The results were so dire that the Chicago Tribune published a pair of exhibits in 2017 about the built-in gaps in the system based on analyzes by ProPublica Illinois and the Chicago Tribune. A June article confirmed my suspicions that high-end properties were undervalued while low-end properties were overvalued. They followed up in December with another article which demonstrated that the tax burden was also unfairly placed on homeowners and away from commercial and industrial properties.
Kaegi addressed both of these issues during his tenure. I can’t find outlandish reviews anymore. However, the other thing I love about this guy is that he’s also been a model of transparency, sharing great data on the impact of his work – and you know how much I love the data.
The latest gem I found is this Chicago 2021 Revaluation Dashboard on the appraiser site that lets you see what’s changed by property type and community area. Here are some conclusions drawn from this data:
- The total of all property values increased by 31%. So if your taxable value has increased by less than that, you probably get a slight tax reduction.
- The total value of residential properties only increased by 10% and that includes some new construction. Thus, the average assessed value of an older home has probably increased by less than 10%.
- The total value of non-residential properties increased by 56%.
- These last two facts also mean that the tax burden has shifted from houses to non-residential properties.
- If you go to the map and select Residential, you’ll see that the tax burden has also shifted from low-income neighborhoods to high-income neighborhoods. Thus, the Lower West Side saw a 51% increase in its total assessed value while Riverdale saw a 40% drop.
- Since I live in West Town, I would point out that the total residential values have increased by 20%.
So there is proof that the two biggest problems of the Berrios dynasty have been solved. That’s why I like that guy from Kaegi even though my assessed value went up 50%. Yeah, got a guy working on it.
#PropertyTaxes #ChicagoPropertyTaxes #FritzKaegi
Gary Lucido is the president of Lucid Realty, the Chicago-area full-service real estate brokerage firm that offers homebuyer rebates and discount commissions. If you want to keep up to date with the Chicago real estate market or get an insider’s view on the sordid underside of the real estate industry, you can subscribe to Getting Real via email using the form below. Be sure to verify your email address when you receive the verification notice.