Property Tax Rates by State: Complete 2026 Guide
Property taxes are one of the largest recurring expenses for homeowners in the United States, yet the amount you pay varies dramatically depending on where you live. A home valued at $300,000 could cost you over $6,600 per year in New Jersey but only around $1,050 in Hawaii.
Highest rate: New Jersey at 2.21% — $8,928/yr median bill
Lowest rate: Hawaii at 0.29% — $1,893/yr median bill
National average: Approximately 1.07% effective rate
Remember: A low rate does not always mean a low bill — home values matter just as much
How Effective Property Tax Rates Are Calculated
When people talk about property tax rates, they are almost always referring to the effective tax rate — the actual percentage of your home's market value that you pay in taxes each year. This is different from the nominal millage rate your county publishes.
Effective Tax Rate = (Total Taxes Paid / Total Home Value) × 100
This metric is useful because it accounts for differences in how states assess property values. Some states assess homes at full market value while others assess at a fraction — sometimes as low as 10 percent. The effective rate gives you an apples-to-apples comparison of the actual tax burden.
Our data comes from U.S. Census Bureau American Community Survey estimates covering owner-occupied housing across more than 3,000 counties. Explore county-level data on each of our state pages or use our property tax calculator to estimate your own bill.
States With the Highest Property Tax Rates
The highest effective rates tend to be concentrated in the Northeast and Upper Midwest — states with higher costs of living, well-funded school systems, and older infrastructure requiring ongoing maintenance.
| Rank | State | Effective Rate | Median Annual Tax | Median Home Value |
|---|---|---|---|---|
| 1 | New Jersey | 2.21% | $8,928 | $404,100 |
| 2 | Illinois | 2.08% | $4,744 | $228,200 |
| 3 | New Hampshire | 1.93% | $6,036 | $312,700 |
| 4 | Connecticut | 1.79% | $5,746 | $321,100 |
| 5 | Texas | 1.68% | $3,520 | $209,500 |
New Jersey has held the top spot for years, driven by high municipal costs and well-funded school districts. The median annual bill exceeds $8,900 — the most expensive in the country.
Texas may surprise some on this list. While it has no state income tax, it compensates with above-average property tax rates, particularly in metro areas like Houston, Dallas, and Austin.
States With the Lowest Property Tax Rates
States with the lowest rates tend to rely more on other revenue sources — sales taxes, income taxes, or natural resource revenue like oil and gas.
| Rank | State | Effective Rate | Median Annual Tax | Median Home Value |
|---|---|---|---|---|
| 1 | Hawaii | 0.29% | $1,893 | $652,800 |
| 2 | Alabama | 0.39% | $572 | $146,700 |
| 3 | Colorado | 0.49% | $1,756 | $358,300 |
| 4 | Louisiana | 0.51% | $832 | $163,100 |
| 5 | South Carolina | 0.55% | $924 | $168,000 |
Hawaii has the lowest effective rate at 0.29%, but because home values are exceptionally high, the median annual bill is still nearly $1,900. A low rate does not always mean a low bill.
Alabama offers both a low rate and a low median bill — just $572/yr — making it one of the most affordable states for property taxes in absolute terms.
For a deeper dive, see our full article on states with the lowest property taxes.
Regional Patterns in Property Tax Rates
Property tax rates follow clear regional patterns. The Northeast (New Jersey, Connecticut, New Hampshire, New York) and Upper Midwest (Illinois, Wisconsin, Nebraska, Iowa) consistently have the highest rates — driven by strong school funding, dense development, and limited alternative revenue sources.
The South generally has the lowest rates. States like Alabama, Louisiana, South Carolina, and Arkansas keep effective rates below 0.65%, relying instead on sales and income taxes. The West is more varied — Hawaii and Colorado are very low, while Oregon and Washington sit closer to the national average. California is unique: Proposition 13 caps assessment increases at 2% per year, so long-time homeowners often pay far less than recent buyers.
How Property Tax Rates Affect Homebuyers
Property taxes directly impact your monthly housing costs. Lenders include estimated property taxes in your debt-to-income ratio, which can reduce how much home you qualify to buy — sometimes by tens of thousands of dollars in high-tax states.
Beyond the mortgage, higher taxes mean less money for savings, investments, or home improvements. This is why many retirees relocate to lower-tax states, and why it is worth checking for homestead exemptions that reduce your burden.
Use our property tax calculator to estimate what you would pay in any county before making a purchasing decision.
Frequently Asked Questions
Which state has the highest property tax rate?
New Jersey has the highest effective property tax rate at approximately 2.21%. The median annual bill exceeds $8,900.
Which state has the lowest property tax rate?
Hawaii has the lowest effective rate at approximately 0.29%. However, high home values mean the median bill is still around $1,900/yr.
Are there any states with no property tax?
No. All 50 states levy property taxes at the local level. However, some states offer significant exemptions for seniors, veterans, and disabled homeowners.
Does a lower property tax rate mean I will pay less?
Not necessarily. Your total bill depends on both the rate and your home's assessed value. A state with a low rate but high home values (like Hawaii) may still result in a sizable bill.
Estimate Your Property Tax
Use our free calculator to estimate your annual property tax based on your location and home value.
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