In his State of Metro Address, Mayor Karl Dean proposed raising the city’s property tax rate by 53 cents.
NASHVILLE, Tenn. -
A property tax increase proposed earlier this month by Nashville Mayor Karl Dean would also affect the city's renters.
According to the Greater Nashville Apartment Association, if the mayor's 53-cent tax increase is approved, Nashville renters could see an increase of $14 a month based on the average rent paid in Davidson County.
The increase would be significantly more for those paying greater than $790 a month and for those living in large commercial apartment complexes.
GNAA says a property tax increase could cause a domino effect as landlords look to cut cost in property care and services offered to renters.
Mayor Dean's increase would raise the property tax rate to $4.66 per $100 of assessed value, generating approximately $100 million a year for the city.
The impact on the average homeowner would be about $16 a month, or $192 a year, using the Greater Nashville Association of Realtors' median home price of $145,400.
The mayor said his proposal and budget of $171 billion moves the city forward by investing in schools and public safety.
Nashville's News 2 spoke with landlord Brandon Thomson who recently relocated to Florida.
"I consider the property I have in Nashville almost a gold mine because it's so close to Vanderbilt and it's in a great area," he said. "I knew the property value would eventually increase."
Thomas said if the proposed tax increase is approved, he would have to increase his rates to renters.
"Well, considering HOA dues and all of that, if taxes were increased, I would definitely have to increase rent, which would make renters unhappy, but would also make it much more difficult to keep renting," he said.
Property management companies said some landlords in lieu of increasing rent could instead cut back in services, maintenance and other perks.
The Metro Council must approve a city budget by the end of June.