Taxes on Iowa apartments twice national average

Dustin Mcdonough

Property taxes on apartments in Iowa are more than twice the national average, according to a study by the Minnesota Taxpayers Association.

Stephen Ringlee, president of the Ames School Board, said the study showed that the average property tax on an apartment building in Iowa is $26,663 a year.

That’s 114 percent higher than the national average of $12,419.

“The average apartment building in the study was a 20-unit, $600,000 unfurnished building with $30,000 of personal property,” Ringlee said.

Richard Horn, Ames city assessor, said the average property tax rate in Ames is $94 a month. That means a 20-unit apartment building in Ames would be required to pay $22,560 a year in property taxes.

Kevin Grall, manager of Westfield Apartments, 5910 W. Lincoln Way, said about 10 percent of rent at Westfield goes toward paying property taxes.

Property tax rates in other Iowa cities are similar to the rates in Ames.

For example, Iowa City Deputy Assessor Denny Baldridge said the property tax rate in Iowa City is about $32 per $1,000 of value in a building, which figures out to be $20,160 a year for the “average” apartment building, according to the Minnesota Taxpayers Association. That makes the monthly property tax rate in a 20-unit apartment about $84 a month.

Mary Ann Lundy, controller at Ev Cochrane and Associates, 207 Stanton Ave., said most residential areas usually are eligible for a cut in property tax rates, which would make them less expensive.

However, under Iowa law, apartments are not eligible for the rollback, meaning that the property is assessed at full value.

Lundy said a small rollback allowing apartments to be assessed in the 90th percentile range will go into effect soon. “That’s a small amount, so it really doesn’t help all that much,” she said.

Ringlee said there are ways to bring the property tax rate down.

“Right now in Iowa, we can fund schools by borrowing money, paying through a local property tax or a sales tax,” he said. “By using a mixture of taxes to fund schools, I think we can help to bring down the property tax rate.”

Lundy said a public vote will be held on Feb. 15 to add a 1 percent sales tax to fund schools, meaning property tax rates potentially could be lowered.


Property taxes

– Iowa average property taxes for an apartment building: $26,663 per year

– National average taxes: $12,419

– Ames average property tax rate per month: $94

– Iowa City average property tax rate per month: $84