With property values up 21%, Kenney proposes relief for growing real estate taxes

As anyone currently in the market for a house can tell you, property values in Philadelphia are soaring — and soon, home owners will know exactly how much.

Tuesday morning, the city’s Office of Property Assessment announced that it has completed the first reassessment of all property values in Philadelphia since before the start of the pandemic. What they found: the value of all properties in the city has risen by around 21% since tax year 2020, and residential values have risen by 31%.

Which is why, officials said, Mayor Kenney is proposing a relief package designed to take some of the growing financial pressure off of Philadelphians.

“We understand that capturing what’s happened in the market over the last few years will have an impact on taxpayers,” said city finance director Rob Dubow. “And we want to help protect them from that. “

The first measure they’re proposing is increasing the city’s homestead exemption, which reduces the assessed value of primary residential properties, thereby reducing the real estate tax. The exemption currently reduced assessed property value by $45,000. The new proposal would increase that exemption to $65,000, which officials say, for most homeowners, would translate to a more than $900 savings.

The plan also proposes a 20% increase in funds for the Longtime Owner Occupants Program (LOOP), an income-based program that caps increases in property taxes for homeowners who’ve lived in their homes for more than 10 years, and have seen significant growth in their property taxes.

Dubow said they’re also working on additional relief efforts, including rent relief, and enhanced outreach to improve participation in existing programs, including the Senior Citizen Tax Freeze program, and the Owner Occupied Payment Agreement (OOPA), which can help protect against the risk of foreclosure.

The package also includes a “substantial” reduction in the city’s wage tax, Dubow said, from 3.84% down to 3.7% for residents, and 3.44% for non-residents — the lowest wage tax rate, officials say, since 1976.

“The wage tax has really been one of our most onerous taxes for decades and having the opportunity to reduce it and help our taxpayers is something that we thought was very important,” Dubow said.

“The wage tax was seen as one that would have an impact on the greatest number of people across the city, whether they own property or not,” added city commerce director Anne Nadol. “And really was going to send a signal that we are open for business. We are aware of this, the competitive disadvantage that the wage tax has put us at, and that we continue the commitment to try and reduce it as much as possible.”

Altogether, Dubow said, the relief package will cancel out any additional tax revenue that the city would be receiving as a result of higher property values.

New property values will be uploaded to property.phila.gov by May 9, and written notices of the new values will be mailed out by Sept. 1 at the latest, officials said.

Homeowners who believe their valuation is incorrect have until Oct. 3 to file a formal appeal with the Board of Revision of Taxes.

A summary of relief programs and information on how to apply are available on the city’s website.