Yahoo Finance In A Market Of Rising Prices, These States Keep Property Taxes Low — The Lowest May Surprise You
As home prices ebb around all-time highs and mortgage rates hover near 7%, some states offer surprisingly low property taxes for budget-conscious homeowners.
A report from ATTOM Data Solutions found that while property taxes on single-family homes surged 6.9% nationally in 2023, reaching $363.3 billion, several states have maintained low effective tax rates.
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Hawaii leads the pack with an effective property tax rate of just 0.31% despite having the highest median home value among low-tax states at $856,644. This means the average Hawaii resident homeowner pays about $2,656 annually in property taxes.
Arizona follows closely with a 0.41% rate, according to Bankrate. With a median home value of $451,500, Arizona homeowners typically face an annual property tax bill of around $1,851. With its 0.42% rate and more modest median home value of $230,383, Alabama offers some of the country’s lowest overall property tax bills, averaging just $967 per year, the report said.
Delaware and Tennessee round out the top five with rates of 0.43% and 0.44%, respectively. In Delaware, where the median home value is $388,199, the average property tax bill is about $1,669 annually. Tennessee homeowners, with a median home value of $324,797, pay around $1,429 per year.
Other states in the top 10 for lowest effective property tax rates include Idaho (0.44%), Utah (0.45%), Nevada (0.48%), Colorado (0.48%), and West Virginia (0.49%). Notably, West Virginia, with the lowest median home value in the group at $167,862, offers an average annual property tax bill of just $823.
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While some states offer property tax relief, others present a different picture. The Northeast and Midwest regions saw the highest effective property tax rates in 2023, with Illinois leading the pack.
The report said Illinois homeowners face the nation’s highest effective property tax rate, at 1.88%. For a median-priced home in the state, valued at $265,824, this translates to an annual property tax bill of about $4,997, which is more than five times what the average Alabama homeowner pays despite similar median home values.
New Jersey follows closely with a 1.64% rate. Given the state’s higher median home value of $527,599, New Jersey homeowners typically face an annual property tax bill of around $8,653 — the highest in actual dollars among all states.
Connecticut (1.54%), New York (1.46%), and Nebraska (1.46%) round out the top five highest-taxed states. In Connecticut, where the median home value is $407,223, the average property tax bill comes to about $6,271 annually. New York homeowners, with a median home value of $470,663, pay around $6,872 per year. Despite a lower median home value of $264,763, Nebraska still sees average annual property tax bills of about $3,866.
Other states in the top 10 for highest effective property tax rates include Ohio (1.37%), Pennsylvania (1.33%), Vermont (1.29%), Kansas (1.26%), and New Hampshire (1.25%).
With a high median home value of $479,363, New Hampshire has an average annual property tax bill of about $5,992.
The contrast between high-tax and low-tax states is meaningful.
A homeowner in Illinois with a property valued at the state’s median would pay nearly six times more in annual property taxes than a homeowner with a similarly valued property in Hawaii.
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