NAHB analysis of the Census Bureau’s quarterly tax data shows that $633.9 billion in taxes were paid by property owners in the four quarters ending Q3 2020. Four-quarter property tax revenues have declined just once over the last eight years and are more than $100 billion (19.2%) higher than they were four years ago.
Year-over-year growth of four-quarter property tax revenue reaccelerated to 5.1% after dipping to 4.8% in Q2 2020. Prior to the second quarter, growth had accelerated each of the previous five quarters and has not turned negative since 2012. Corporate income tax revenues (+7.6%) grew the most in percentage terms, followed by property (+5.1%), individual income (+3.3%), and sales taxes (-0.8%).
Sales tax revenues are still recovering from a COVID-related decline in the second quarter. Reduced consumer spending caused sales tax receipts to fall 4.9% in Q2, as four-quarter receipts fell to their lowest level since the second quarter of 2019.
Property taxes accounted for 39.6% of state and local tax receipts, a 0.5 percentage point decline over the previous quarter. In terms of the share of total receipts, property taxes were followed by individual income taxes (29.1%), sales taxes (26.7%), and corporate taxes (4.6%).
The ratio of property tax revenue to total tax revenue from the four sources shown above remains 2.6 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.