Despite increases in value, Illinois is still among the worst states in the nation for number of underwater homes.
A total of 367,217 homeowners in Illinois were mortgaged for 25 percent more than what they could sell their homes for as of December 2017. ATTOM Data Solutions calls that “seriously underwater” and their latest statistics show Illinois has more underwater homeowners than any other state but Florida. The Sunshine state had 414,970 underwater homes, but that also accounts for a much lower percentage, considering a population difference of more than 8 million people between the two states.
“In a completely normal housing market, we expect to see about 5 percent of homes underwater [nationwide],” ATTOM senior vice president Daren Blomquist said. “In Illinois, we’re seeing three times that number.”
Overall, Illinois’ high property taxes, Blomquist said, push values below what people owe on their homes.
“That’s going to lower your willingness to buy a certain home at a certain price point,” he said.
The majority of the underwater homeowners live in the Chicago area, where it’s not uncommon for a homeowner to have 10 different taxing bodies contributing to the overall property tax bill. The Chicago area had a far higher percentage of seriously underwater homes than any other metropolitan area in the nation.
Blame for the state’s high property taxes is commonly split between growing school and local spending and Illinois’ nation-highest 7,000 units of government. The state’s local school districts rely on property taxes for the lion’s share of their funding, often accounting for much of a homeowner’s property tax bill.
The situation has been getting worse for years. Illinoisans’ property tax bills have grown by 51 percent in the last 10 years, according to the nonprofit Civic Federation.
Per the report, only Iowa, Mississippi, Kansas and Louisiana have higher percentages of underwater homes.