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Do Caps on Increases in Assessed Values Create a Lock-in Effect? Evidence From Florida’s Amendment One

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  • Ihlanfeldt, Keith R.

Abstract

The property tax savings provided by assessment caps are generally lost when homeowners move. There is, therefore, a concern that homeowners get “locked-in” to their current home. Using data from Florida, the results presented in this paper show that the lock-in effect is nontrivial in magnitude, especially for homeowners in single-family homes (in comparison to condominiums) and those located in jurisdictions with relatively low property tax rates.

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  • Ihlanfeldt, Keith R., 2011. "Do Caps on Increases in Assessed Values Create a Lock-in Effect? Evidence From Florida’s Amendment One," National Tax Journal, National Tax Association;National Tax Journal, vol. 64(1), pages 8-25, March.
    • Handle: RePEc:ntj:journl:v:64:y:2011:i:1:p:8-25
    DOI: 10.17310/ntj.2011.1.01
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    References listed on IDEAS

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    1. John Nagy, 1997. "Did Proposition 13 Affect the Mobility of California Homeowners ?," Public Finance Review, , vol. 25(1), pages 102-116, January.
    2. Chan, Sewin, 2001. "Spatial Lock-in: Do Falling House Prices Constrain Residential Mobility?," Journal of Urban Economics, Elsevier, vol. 49(3), pages 567-586, May.
    3. Ferreira, Fernando, 2010. "You can take it with you: Proposition 13 tax benefits, residential mobility, and willingness to pay for housing amenities," Journal of Public Economics, Elsevier, vol. 94(9-10), pages 661-673, October.
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    6. Nada Wasi & Michelle J. White, 2005. "Property Tax Limitations and Mobility: The Lock-in Effect of California's Proposition 13," NBER Working Papers 11108, National Bureau of Economic Research, Inc.
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    1. Ross M. Batzer & Jonah Coste & William M. Doerner & Michael J. Seiler, 2024. "The Lock-In Effect of Rising Mortgage Rates," FHFA Staff Working Papers 24-03, Federal Housing Finance Agency.
    2. Hatch, M.E., 2021. "Voluntary, forced, and induced renter mobility: The influence of state policies," Journal of Housing Economics, Elsevier, vol. 51(C).
    3. John V. Duca & Patric H. Hendershott & David C. Ling, 2017. "How Taxes and Required Returns Drove Commercial Real Estate Valuations over the Past Four Decades," National Tax Journal, National Tax Association;National Tax Journal, vol. 70(3), pages 549-584, September.
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    5. William H. Hoyt & Aaron Yelowitz, 2016. "Anticipated Property Tax Increases and the Timing of Home Sales: Evidence from Administrative Data," CESifo Working Paper Series 6264, CESifo.
    6. Nalitra Thaiprasert & Dagney Faulk & Michael J. Hicks, 2013. "A Regional Computable General Equilibrium Analysis of Property Tax Rate Caps and a Sales Tax Rate Increase in Indiana," Public Finance Review, , vol. 41(4), pages 446-472, July.
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    8. Mr. John Norregaard, 2013. "Taxing Immovable Property Revenue Potential and Implementation Challenges," IMF Working Papers 2013/129, International Monetary Fund.
    9. Bradley, Sebastien, 2018. "Assessment limits and timing of real estate transactions," Regional Science and Urban Economics, Elsevier, vol. 70(C), pages 360-372.
    10. Chris Cunningham & Robert R. Reed, 2012. "Housing wealth and wage bargaining," FRB Atlanta Working Paper 2012-20, Federal Reserve Bank of Atlanta.

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