Property Tax by State 2026 — Rates Compared
Property taxes are the largest ongoing cost of homeownership — sometimes exceeding your mortgage interest. And the variation between states is dramatic: a $400,000 home in New Jersey costs ~$8,900/year in property tax. The same home in Hawaii costs ~$1,080.
Calculate your property tax bill in any state with the Property Tax Calculator→Property Tax Rates by State (2026)
10 Highest Property Tax States
| Rank | State | Effective Rate | Tax on $400k Home | Tax on $300k Home |
|---|---|---|---|---|
| 1 | New Jersey | 2.23% | $8,920 | $6,690 |
| 2 | Illinois | 2.07% | $8,280 | $6,210 |
| 3 | New Hampshire | 1.93% | $7,720 | $5,790 |
| 4 | Connecticut | 1.79% | $7,160 | $5,370 |
| 5 | Vermont | 1.73% | $6,920 | $5,190 |
| 6 | Wisconsin | 1.61% | $6,440 | $4,830 |
| 7 | Nebraska | 1.61% | $6,440 | $4,830 |
| 8 | Texas | 1.60% | $6,400 | $4,800 |
| 9 | New York | 1.40% | $5,600 | $4,200 |
| 10 | Pennsylvania | 1.36% | $5,440 | $4,080 |
10 Lowest Property Tax States
| Rank | State | Effective Rate | Tax on $400k Home | Tax on $300k Home |
|---|---|---|---|---|
| 1 | Hawaii | 0.27% | $1,080 | $810 |
| 2 | Alabama | 0.37% | $1,480 | $1,110 |
| 3 | Colorado | 0.51% | $2,040 | $1,530 |
| 4 | Nevada | 0.53% | $2,120 | $1,590 |
| 5 | Utah | 0.55% | $2,200 | $1,650 |
| 6 | Idaho | 0.56% | $2,240 | $1,680 |
| 7 | Arizona | 0.59% | $2,360 | $1,770 |
| 8 | Wyoming | 0.61% | $2,440 | $1,830 |
| 9 | Tennessee | 0.62% | $2,480 | $1,860 |
| 10 | South Carolina | 0.56% | $2,240 | $1,680 |
What Drives Property Tax Differences
Property taxes fund local services — primarily schools, fire, police, roads, and local government. States with high property taxes often have:
| Factor | High-Tax States | Low-Tax States |
|---|---|---|
| State income tax | Lower or none (NH, TX) | Often have income tax instead |
| School funding | Heavily property-tax funded | State-level funding |
| Local government services | More robust | Leaner |
| Assessments | Close to market value | Below market value |
The Trade-Off
States with no income tax (TX, FL, NH, TN, WA) often compensate with higher property taxes or sales taxes. There's no free lunch — the revenue comes from somewhere.
| State | Income Tax | Property Tax | Sales Tax | Total Tax Burden |
|---|---|---|---|---|
| Texas | 0% | 1.60% | 6.25% + local | Moderate-high |
| Florida | 0% | 0.86% | 6% + local | Moderate |
| New Jersey | 1.4-10.75% | 2.23% | 6.625% | Very high |
| Hawaii | 1.4-11% | 0.27% | 4% + local | Moderate |
Property Tax and Your Mortgage Payment
Property taxes are typically included in your monthly mortgage payment through an escrow account:
| On $400,000 Home | Low-Tax State (0.5%) | Medium (1.0%) | High-Tax State (2.0%) |
|---|---|---|---|
| Annual property tax | $2,000 | $4,000 | $8,000 |
| Monthly escrow | $167 | $333 | $667 |
| Monthly P&I (6.5%, 20% down) | $2,023 | $2,023 | $2,023 |
| Total monthly | $2,190 | $2,356 | $2,690 |
That $500/month difference in property taxes between a low-tax and high-tax state is $6,000/year — or $180,000 over 30 years.
Calculate your total payment including property tax→SALT Deduction Cap
Property taxes are deductible on your federal return if you itemize — but the $10,000 SALT cap limits the total deduction for state/local income tax + property tax combined.
In high-tax states where property tax alone exceeds $10,000, you get no additional benefit from the property tax deduction. This has made high-property-tax states less attractive since the 2018 tax reform.
Property Tax Exemptions
Many states offer property tax reductions for specific groups:
| Exemption | Typical Savings | Who Qualifies |
|---|---|---|
| Homestead exemption | $25,000-$75,000 off assessed value | Primary residence owners |
| Senior exemption | Additional reduction or freeze | Age 65+ (varies by state) |
| Veteran exemption | Partial to full exemption | Veterans with disabilities |
| Disability exemption | Partial reduction | Disabled homeowners |
Homestead Exemption Examples
| State | Homestead Exemption |
|---|---|
| Texas | $100,000 off school taxes (plus $10,000 general) |
| Florida | $50,000 off assessed value |
| California | $7,000 off assessed value |
| Georgia | Varies by county ($2,000-$50,000) |
How to Appeal Your Property Tax Assessment
If you believe your home is over-assessed:
- Check the assessment — compare to recent sales of similar homes
- Review for errors — wrong square footage, extra bedrooms, etc.
- File a formal appeal within the deadline (usually 30-90 days after notice)
- Present comparable sales showing lower values
- Attend the hearing or hire a property tax attorney
Success rate on appeals is surprisingly high — some estimates suggest 30-50% of appeals result in reductions.
Frequently Asked Questions
Can I deduct all my property taxes?
Only up to the $10,000 SALT cap (combined with state/local income or sales tax), and only if you itemize.
Why did my property taxes go up?
Common reasons: reassessment (home value increased), local tax rate increase, expiration of exemptions, or new local levies (school bonds, infrastructure).
Do property taxes go away when I pay off my mortgage?
No. Property taxes continue forever. When your mortgage is paid off, you'll pay property taxes directly instead of through escrow.
Which state has the lowest total tax burden for homeowners?
It depends on income level and home value. For a median-income homeowner, states like Wyoming, Nevada, and Florida often rank lowest in total state + local tax burden.
Official Resources
- CFPB — Consumer financial protection and mortgage tools
- FDIC — Deposit insurance and banking information
This article is for informational purposes only and does not constitute financial advice. Consult a qualified financial advisor for guidance tailored to your personal circumstances.
Related Articles
Share this article