Property Taxes: Highballed or Lowballed? It Depends on Location
Key Takeaways
- Property tax rates in predominantly Black and Latino neighborhoods are often significantly higher than in white areas for similarly valued homes.
- Black homeowners face lowball appraisals that undervalue their properties by an average of $48,000 compared to similar homes in predominantly white neighborhoods.
- New Jersey’s Freeze Act protects property owners by freezing assessments for two years following a successful appeal.
With property values climbing, the threat of rising property taxes weighs heavily on homeowners. New Jersey has the highest property taxes in the country. While these taxes fund essential local services like education, roads, parks, and emergency services, some communities bear a disproportionate burden.
When Property Taxes Get Highballed
Bonita Anderson, a Baltimore mother and grandmother, lost her home at 70 after falling behind on property taxes. She bought the home in 2009 and faithfully paid toward her $100,000 mortgage for over a decade. When cancer struck in 2020, medical bills consumed her budget. By 2022, Baltimore auctioned her home at a tax sale.
Anderson paid Baltimore $18,900 by the end of 2022—more than triple her outstanding taxes. However, these payments went toward taxes under the new owner’s name, not her back taxes. In 2023, the city foreclosed on her home.
From 2019 to 2023, Baltimore listed 44,000 properties for municipal tax sales. A staggering 92% were in majority non-white neighborhoods. According to ABC analysis, homeowners in predominantly Black and Brown areas pay higher taxes than those in white neighborhoods for similarly priced homes.
On Long Island, this disparity is clear. Garden City residents—a predominantly white suburb—face residential tax bills between $10,000 and $15,000. Just miles away in Hempstead, where 88% of residents are Black or Latino, homeowners pay similar amounts for properties worth significantly less. This is where understanding highball vs lowball taxation becomes critical for a property tax lawyer to address.
A New York University Furman Center study examined Class I residential properties across New York City. The findings revealed systemic discrimination: homeowners in predominantly non-Hispanic Black neighborhoods pay higher effective tax rates than those in predominantly white areas.
When researchers applied the citywide average effective tax rate to Fiscal Year 2018, the results were striking. Predominantly Black neighborhoods would have saved about $17 million annually in property taxes, while areas with the fewest Black residents would have paid $10 million more per year. For homeowners facing these inequities, consulting an NJ property tax appeal lawyer can help challenge unjust assessments.
The Lowball Appraisal Problem
High property tax rates tell only half the story. Black homeowners also face lowball appraisals when buying or refinancing homes. A low appraisal reduces a home’s selling price, and combined with inflated tax bills, this severely limits wealth-building opportunities for Black families.
Black and Latino homeowners are twice as likely to receive a lowball appraisal. A 2018 Brookings report found homes in predominantly Black neighborhoods are undervalued by $48,000 on average—about 23% less than comparable homes in neighborhoods with fewer Black residents.
What This Means for Homeowners
The combination of highball vs lowball treatment—inflated tax assessments paired with depressed appraisals—creates a wealth-building trap. Homeownership has long been central to the “American dream,” allowing families to accumulate and pass down generational wealth. When property taxes are too high and appraisals too low, this dream becomes nearly impossible for disproportionately impacted communities.
In New Jersey, the Freeze Act offers some protection. This law freezes property tax assessments for two years following a successful appeal, shielding property owners from municipal retaliation. If you believe your property has been over-assessed, you have the right to appeal property tax assessment decisions.
As New Jersey’s budgetary needs continue to climb higher, municipalities may lean more heavily on property tax revenue. This makes it increasingly important for property owners to understand their rights and options. Whether you’re dealing with residential properties or facing challenges with industrial property tax assessments, professional legal guidance can make a significant difference.
Even if you’re navigating challenges after foreclosure sale, understanding how the highball vs lowball dynamic affects your situation is essential for protecting your interests.
Take Action on Your Property Tax Assessment
If you believe your property has been over-assessed, you have the right to appeal. Our experienced property tax attorneys have helped countless New Jersey homeowners successfully challenge unfair assessments and reduce their tax burden. Schedule your free consultation today.
