An Arm and a Leg: Will the Record Sales Tax Hurt City Home Values?

Living in Chicago isn’t cheap. Our gas prices are among the highest in the nation. We pay a lot for milk, too. Housing prices, while not outrageous, are certainly not inexpensive. And now, Chicagoans will have the dubious distinction of paying the highest sales taxes in the nation.

Chicago will soon boast the highest taxes in the nation. That’s right. Starting in November, thanks to an increase in the Cook County sales tax, shoppers buying in the city of Chicago will pay a total sales tax of 10.25 percent. This figure doesn’t compare favorably with other major cities, including New York and Los Angeles, both of whom have sales tax rates under 8.5 percent.

The question I’ve been asked is this: Will the increased sales taxes hurt property values? Will the taxes cause buyers to avoid purchasing a home in the city and instead look elsewhere? My response? The increased sales tax may be a burden, but it’s not a large enough one to make buyers avoid the city. The reason for this is simple. Chicago has too many positives to offer.

We have wonderful entertainment options, a wealth of varying neighborhoods, top-notch sports teams, ample park space, tons of wonderful restaurants and a thriving theater scene. We have internationally respected tourist attractions like Millennium Park, the shopping districts along Michigan Avenue, Wrigley Field and the Sears Tower. We’re getting impressive new buildings like Trump International Hotel and Tower by Donald Trump and the Chicago Spire by world renowned architect Santiago Calatrava. Our architecture is known the world over. Summer here is marked by major concerts, street fairs and huge events such as Taste of Chicago.

In short, Chicago is an amazing place to live. No one wants to pay higher taxes. But if you do have to pay them, you might as well live somewhere as wonderful as our city. If you’re worried that increased taxes will chase away buyers, you can relax. There will always be more than enough buyers who want to take advantage of all that Chicago offers.