States With the Lowest Property Taxes in 2026

If you are searching for a place to live where property taxes will not dominate your monthly budget, you are not alone. Property taxes are one of the most significant ongoing costs of homeownership, and the difference between high-tax and low-tax states can amount to thousands of dollars per year. While no state in the U.S. completely eliminates property taxes, several states keep their effective rates remarkably low.

In this article, we rank the 10 states with the lowest effective property tax rates in 2026, explain why their rates are so low, and discuss the trade-offs you should consider before relocating. We also highlight specific counties within these states where property tax burdens are especially favorable for homeowners.

Top 10 States With the Lowest Property Taxes

The following rankings are based on effective property tax rates, which measure the actual taxes paid as a percentage of home value. This provides the most accurate comparison across states regardless of how they assess properties.

1. Hawaii -- Effective Rate: 0.29%

Hawaii has the lowest effective property tax rate in the nation at just 0.29 percent. The state funds much of its government through its general excise tax, tourism-related revenue, and relatively high income taxes. However, home prices in Hawaii are among the highest in the country, with a median home value above $650,000. That means even with a low rate, the median annual tax bill comes in around $1,893. Honolulu County, which encompasses the entire island of Oahu, has rates that reflect the statewide average, making it an accessible starting point for exploring Hawaii property taxes.

2. Alabama -- Effective Rate: 0.39%

Alabama stands out as one of the most affordable states for property taxes by virtually any measure. With an effective rate of 0.39 percent and a median home value around $147,000, the median annual tax bill is just $572. Alabama assesses owner-occupied homes at only 10 percent of their appraised value, which dramatically reduces the taxable base. Counties like Baldwin County along the Gulf Coast offer a combination of low taxes and desirable coastal living.

3. Colorado -- Effective Rate: 0.49%

Colorado keeps property taxes low through the Gallagher Amendment and TABOR (Taxpayer's Bill of Rights), which together limit how much revenue can be collected through property taxes. The residential assessment rate in Colorado has been reduced multiple times over the past two decades. Despite rising home values in areas like Denver and Boulder, the effective rate remains below 0.50 percent. El Paso County (home to Colorado Springs) is one of the more affordable metro areas in the state.

4. Louisiana -- Effective Rate: 0.51%

Louisiana offers a generous homestead exemption that shields the first $75,000 of a home's assessed value from parish taxes. Combined with a relatively low assessment ratio, this results in an effective rate of 0.51 percent. The median annual property tax bill in Louisiana is around $832. Parishes in the northern part of the state tend to have the lowest rates, though even the New Orleans metropolitan area remains well below the national average.

5. South Carolina -- Effective Rate: 0.55%

South Carolina provides favorable tax treatment for owner-occupied primary residences. These homes are assessed at 4 percent of fair market value, compared to 6 percent for second homes and commercial property. The state also offers a homestead exemption for residents age 65 and older. With a median annual bill of $924, South Carolina is attractive to retirees and first-time buyers alike. Greenville County has become particularly popular for its growing job market and manageable tax burden.

6. West Virginia -- Effective Rate: 0.57%

West Virginia benefits from some of the lowest home values in the country, with a statewide median around $128,000. Combined with a 0.57 percent effective rate, the median annual tax bill is approximately $730. The state assesses property at 60 percent of appraised value, and homestead exemptions are available for senior citizens. While the state faces economic challenges in some regions, the very low cost of housing and taxes appeals to those on fixed incomes.

7. Wyoming -- Effective Rate: 0.57%

Wyoming benefits from substantial revenue generated by the energy industry, particularly coal, oil, and natural gas. This revenue reduces the state's dependence on property taxes. Wyoming also has no state income tax, making it doubly attractive for those looking to minimize their overall tax burden. The effective rate of 0.57 percent and a median annual bill around $1,452 reflect moderate home values across most of the state.

8. Utah -- Effective Rate: 0.58%

Utah has experienced rapid population growth and rising home values, particularly in the Salt Lake City corridor. Despite this growth, the state has managed to maintain a low effective rate of 0.58 percent. Utah offers a primary residential exemption that reduces the taxable value of a home by 45 percent, which is a significant factor in keeping effective rates low. Salt Lake County is the most populated county and offers rates close to the statewide average.

9. Arkansas -- Effective Rate: 0.61%

Arkansas assesses residential property at 20 percent of its appraised value, which produces a low effective rate of 0.61 percent. The median annual tax bill is around $734. A homestead tax credit of up to $375 per year provides additional relief for owner-occupied properties. Benton County, in the rapidly growing Northwest Arkansas region, combines reasonable property taxes with a strong local economy anchored by major employers.

10. Arizona -- Effective Rate: 0.62%

Arizona rounds out the top 10 with an effective rate of 0.62 percent. The state limits property tax increases through its Truth in Taxation law, which requires local governments to notify taxpayers and hold hearings before raising levies. Maricopa County, home to Phoenix, has rates slightly above the state average but still well below the national median. Arizona's combination of warm weather, growing job market, and low property taxes continues to drive in-migration.

Trade-offs of Living in Low Property Tax States

Before you pack your bags for a low-tax state, it is worth understanding the trade-offs. Property taxes are the primary funding mechanism for local services, especially public schools, fire departments, and road maintenance. States with lower property tax revenue often compensate in one or more of the following ways:

• Higher sales taxes: States like Louisiana and Arkansas have combined state and local sales tax rates that exceed 9 percent in many areas.
• Higher income taxes: Hawaii has a top marginal income tax rate of 11 percent, one of the highest in the nation.
• Lower public service spending: Some low-tax states invest less per pupil in public education or have fewer public amenities. Alabama and West Virginia rank toward the bottom nationally in per-pupil spending.
• Higher fees: Some states offset low property taxes with higher vehicle registration fees, utility taxes, or impact fees on new construction.

The key takeaway is that your total tax burden includes more than just property taxes. A state with very low property taxes but high income and sales taxes may not actually save you money overall. Consider your full financial picture, including income, spending habits, and the value you place on public services.

Best Counties for Low Property Taxes

Within each state, property tax rates can vary significantly by county. Even in a low-tax state, some counties will have noticeably higher rates than others due to local school district levies, special assessments, or municipal bonds. Here are a few counties that combine low state rates with favorable local conditions:

• Honolulu County, Hawaii -- Benefits from the statewide low rate and access to urban amenities.
• Baldwin County, Alabama -- Gulf Coast location with low taxes and a growing population.
• El Paso County, Colorado -- Affordable Colorado Springs metro with below-average county rates.
• Greenville County, South Carolina -- Rapidly growing economy with competitive tax rates.
• Salt Lake County, Utah -- Access to jobs and recreation with a low effective rate.
• Benton County, Arkansas -- Northwest Arkansas economic hub with strong job growth.

For a personalized estimate of property taxes in any county, use our property tax calculator. You can also explore all counties in a given state on our individual state comparison guide.

Conclusion

Property taxes vary enormously across the United States, and choosing a state with a low effective rate can save homeowners thousands of dollars per year. Hawaii, Alabama, Colorado, and Louisiana lead the way with rates below 0.55 percent, while states like South Carolina, Wyoming, and Utah round out the top 10.

However, a low property tax rate is just one factor in your overall cost of living. Before making a move, evaluate the full tax picture including income taxes, sales taxes, and the quality of local services. Explore our state-by-state data to find the county that best fits your financial goals, and use our property tax calculator to estimate your potential bill before you buy.