Study: Taxes on Foreclosed Properties Keep Out New Buyers

By Odette Yousef

Atlanta, GA – A new report says that metro Atlanta neighborhoods that have been hardest hit by foreclosures are carrying a disproportionate burden of property taxes. The Atlanta Neighborhood Development Partnership, a non-profit housing advocacy group, sponsored the study.

ANDP hired real estate advisory firm Robert Charles Lesser and Co to look at 15 zip codes hardest hit by foreclosures, in 5 metro Atlanta counties. They found that in those areas, there was a major disconnect between the appraised value and the sale value of homes.

John O'Callaghan, head of ANDP, says Fulton County showed the biggest disconnect:

O'CALLAGHAN: The three zip codes with the highest rate of foreclosure actually had a potential for overpayment in taxes of $27 million. Yet in other areas outside of those three zip codes, there was actually an underpayment we found of taxes, of $4.5 million.

Metro Atlanta's overall housing values have declined by 8% since July of 2007, so everybody is overpaying property taxes. But the report finds that in high-foreclosure neighborhoods, homeowners overpay four times as much as homeowners elsewhere.