Declining property values could spark municipal tax increases as a result of the credit crunch. As an area’s real estate tax base shrinks with declining housing prices, increases in the tax rate is bound to increase.

Bloated town budgets need tax revenue to keep the same services. This would be an automatic tax increase in areas where home prices are spiraling downward, which seems to be the pervasive phase lately, throughout the United States.

Likewise, if a municipality enacts a mass appraisal for all the homes within it’s district and assuming the lower home valuations, look for massive tax increases.

Notwithstanding this impetus, cases for property tax reduction still have a good chance for a win on appeal. With an approximate fifty percent error rate on assessments, a little digging can present a very lucrative tax appeal.

And for areas that have not undergone a mass appraisal, the tax appeal pickings for cheap comparables should be easy.