NAHB analysis of the Census Bureau’s quarterly tax data shows that $573 billion in taxes were paid by property owners over the four quarters ending in Q4 2017. It has now been five and a half years since four-quarter property tax revenues last declined. After slowing in each of the prior two quarters, the growth rate increased to 6.0% in Q4 2017, the biggest increase among major sources of state and local tax revenue (see below). Individual income tax receipts grew by 5.4%, the largest four-quarter increase since the first quarter of 2016.
Property taxes accounted for 40.4% of state and local tax receipts and the share has remained above 40.0% for four consecutive quarters for the first time since 2012-2013. In terms of the share of total receipts, property taxes are followed by individual income taxes (28.5%), sales taxes (27.3%), and corporate taxes (3.8%).
As a share of state and local tax receipts, property taxes have increased in all but one of the prior ten quarters (see below). The ratio of property tax revenue to total tax revenue from the four sources shown above remains more than three percentage points above its pre-housing boom average of 37%.
The share of property tax receipts among the four major tax revenue sources naturally changes with fluctuations in non-property tax collections. Non-property tax receipts including individual income, corporate income, and sales tax revenues, by nature, are much more sensitive to fluctuations in the business cycle and the accompanying changes in consumer spending (affecting sales tax revenues) and job availability (affecting aggregate income). In contrast, property tax collections have proven relatively stable, reflecting the long-run stability of tangible property values as well as the smoothing effects of lagging assessments and annual adjustments. Property tax receipts are the least volatile revenue source, followed by sales taxes, individual income taxes, and corporate income taxes, in order of increasing volatility.
 Census data for property tax collections include taxes paid for all real estate assets (as well as personal property), including owner-occupied homes, rental housing, commercial real estate, and agriculture. Owner-occupied and rental housing units combine to make housing’s share the largest among these subgroups.
 If the anomalous data from 2009-2010 are excluded, sales tax receipts are the least volatile, followed by property taxes, individual income taxes, and corporate income taxes.
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