Property taxes are one of the main sources of revenue for local governments. They’re used to fund public services and programs, such as schools; emergency services (including fire and police departments); infrastructure development and upkeep; parks and recreation; sanitation (including pest control, like mosquito abatement); public works; government employee payrolls; and more.
Levied annually, property taxes are calculated by multiplying the assessed value of the property¹ by the effective tax rate² applicable in the property’s region, as well as taking into account any exemptions or deductions that the owner or property may qualify for.
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2025 U.S. Property Taxes by State
Property taxes can vary significantly from state to state, leading to a difference of potentially thousands of dollars in a homeowner’s bill for essentially identical properties.
Therefore, it’s crucial to thoroughly research property taxes at both the state level — to get a general idea of a state’s level of taxation — and a very specific local level for an area you may be considering relocating to.
Moreover, it must be kept in mind that tax levies are always set by local governments — such as the city, county or school district — and may include surtaxes for special assessment districts that may be as small as a neighborhood or subdivision.
To provide a clear snapshot of a state’s overall tax burden, we determined each state’s average effective tax rate by dividing the median real estate taxes paid by the median home value, based on data from the U.S. Census Bureau. In simple terms, this shows what percentage of a state’s median home value goes toward property taxes.
Explore the table below to discover 2025 property taxes ranked by state.
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Highest Property Taxes — Top 10 States
Explore below the top 10 states with the highest property taxes in the U.S., according to the average effective tax rate. Also included are the median state home value, the median real estate taxes paid and the median household income.
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1. New Jersey
- Effective tax rate: 2.23%
- State median home value: $427,600
- Median real estate taxes paid: $9,541
- Median household income: $101,050
New Jersey homeowners contend with the highest average effective property tax rate in the U.S. Paired with the ninth-highest state median home value, New Jersey homeowners have the absolute highest median real estate tax bill in the country at more than $9,500. Plus, New Jersey also charges one of the highest sales taxes at 7%, while its graduated income tax ranges from as low as 1.4% to as high as 10.75%.
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2. Illinois
- Effective tax rate: 2.07%
- State median home value:$250,500
- Median real estate taxes paid: $5,189
- Median household income: $81,702
Although Illinois has the second-highest property tax rate in the U.S., homeowners face noticeably lower tax bills here than in New Jersey, thanks to the state’s significantly lower median home value. However, Illinois homeowners still pay the sixth-highest median property tax bill in the country. Its 6.25% sales tax is also on the heftier side and is joined by a 4.95% state income tax.
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3. Connecticut
- Effective tax rate: 1.92%
- State median home value: $343,200
- Median real estate taxes paid: $6,575
- Median household income: $93,760
Connecticut’s property taxes are among the absolute highest in the U.S. As a result, Connecticut homeowners pay the third-highest property tax rate in the U.S. And, since Connecticut’s median home value trends higher than that of New Hampshire, Connecticut’s tax dues surpass New Hampshire’s property tax bills in sheer dollar amount. It’s also worth mentioning that while New Hampshire charges no sales tax, Connecticut’s state sales and use tax is 6.35%, the 11th highest nationwide.
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4. New Hampshire
- Effective tax rate: 1.77%
- State median home value: $367,200
- Median real estate taxes paid: $6,505
- Median household income: $95,628
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5. Vermont
- Effective tax rate: 1.71%
- State median home value: $290,500
- Median real estate taxes paid: $4,956
- Median household income: $78,024
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6. New York
- Effective tax rate: 1.60%
- State median home value: $403,000
- Median real estate taxes paid: $6,450
- Median household income: $84,578
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7. Texas
- Effective tax rate: 1.58%
- State median home value: $260,400
- Median real estate taxes paid: $4,111
- Median household income: $76,292
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8. Wisconsin
- Effective tax rate: 1.51%
- State median home value: $247,400
- Median real estate taxes paid: $3,746
- Median household income: $75,670
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9. Nebraska
- Effective tax rate: 1.50%
- State median home value: $223,800
- Median real estate taxes paid: $3,350
- Median household income: $74,985
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10. Iowa
- Effective tax rate: 1.43%
- State median home value: $195,900
- Median real estate taxes paid: $2,795
- Median household income: $73,147
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Lowest Property Taxes — Top 10 States
Some U.S. states (and territories) boast attractively low property tax rates paired with low taxation in other areas, as well. For instance, Louisiana currently has the ninth-lowest property tax rate in the U.S. at 0.55%. And, at 4%, it also has one of the lowest sales taxes in the country, as well, while its state income taxes range between 2% and 6%.
For an easier overview between the differences in tax rates among the states with the lowest property taxes, explore our chart below:
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1. Hawaii
- Effective tax rate: 0.27%
- State median home value: $808,200
- Median real estate taxes paid: $2,183
- Median household income: $98,317
Hawaii currently has the lowest average effective property tax rate in the U.S. at 0.27%. However, because it also features one of the highest median home values, homeowners’ tax bills can still easily surpass that of states with higher rates. Even so, at 4%, the state also has one of the lowest sales tax rates in the country — as states with a thriving tourist industry often do.
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2. Alabama
- Effective tax rate: 0.38%
- State median home value: $195,100
- Median real estate taxes paid: $738
- Median household income: $62,027
With an effective property tax rate of 0.38% and the seventh-lowest median home value in the U.S., Alabama offers a homeowner-friendly tax environment overall. Plus, its 4% sales tax is also among the lowest in the U.S., while its income tax ranges between 2% and 5% — making this an attractive location for those looking to own a larger home on a lower budget.
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3. Colorado
- Effective tax rate: 0.49%
- State median home value: $502,200
- Median real estate taxes paid: $2,448
- Median household income: $92,470
Although Colorado’s property tax rate sits at 0.49%, higher home values than in other states with similarly low property tax rates actually leave homeowners here with a bill that’s three times higher than in Alabama. And, while the state income tax sits at a middling 4.63%, Coloradoans do benefit from the lowest sales tax in the country at 2.9%. That’s surpassed only by the seven states that levy no state sales tax at all.
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3. Nevada
- Effective tax rate: 0.49%
- State median home value: $406,100
- Median real estate taxes paid: $1,970
- Median household income: $75,561
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4. Puerto Rico
- Effective tax rate: 0.50%
- State median home value: $124,600
- Median real estate taxes paid: $627
- Median household income: $25,096
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5. South Carolina
- Effective tax rate: 0.51%
- State median home value: $236,700
- Median real estate taxes paid: $1,199
- Median household income: $66,818
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6. Arizona
- Effective tax rate: 0.52%
- State median home value: $358,900
- Median real estate taxes paid: $1,858
- Median household income: $76,872
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7. Utah
- Effective tax rate: 0.53%
- State median home value: $455,000
- Median real estate taxes paid: $2,412
- Median household income: $91,750
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8. Delaware
- Effective tax rate: 0.53%
- State median home value: $326,800
- Median real estate taxes paid: $1,731
- Median household income: $82,855
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9. Idaho
- Effective tax rate: 0.53%
- State median home value: $376,000
- Median real estate taxes paid: $2,006
- Median household income: $74,636
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10. West Virginia
- Effective tax rate: 0.54%
- State median home value: $155,600
- Median real estate taxes paid: $835
- Median household income: $57,917
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Year-over-Year Changes in U.S. Property Taxes by State
All 50 states (as well as Washington, D.C. and Puerto Rico) saw the media property tax bill rise year-over-year, despite effective tax rates trending down. This came as the result of median home values increasing throughout the country, leading to elevated bills. So, even though owners paid higher property taxes, the average effective tax rate now sits below 0.6% in 16 states, up from 11 in the previous year. New Hampshire recorded the largest drop in effective tax rates, going from 2.09% in the previous year to 1.89% now.
Explore the table to see how the current year compares to the previous when it comes to property tax rates, median home values and median property taxes paid in all 50 U.S. states plus Washington, D.C. and Puerto Rico
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Methodology
Data concerning median real estate taxes paid, the state (including D.C. and the Commonwealth of Puerto Rico) median home value, the median household income was extracted from the U.S. Census Bureau’s 2019-2023 American Community Survey 5-Year Estimates.
The average effective tax rate (also referred to as effective tax rate on this page) was calculated by dividing the median real estate taxes paid by the median home value.
Median home value has been defined as the assessed median home value. However, it’s important to note that the assessment refers not to a tax assessor’s valuation, but to the assessment of American Community Survey respondents of what their property might sell for if it were on the market.
All figures are based on 2023 (referred to as “current”) and 2022 (referred to as “previous”) figures, the most recent data made available by the U.S. Census Bureau.
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This article originally appeared on Propertyshark.com and was syndicated by MediaFeed.org
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