America’s 10 Worst States for Property Taxes in 2026 – and the Cheapest States

The average American homeowner gives thousands of dollars a year to local governments to pay property taxes. You write that check, whether you just bought your house or paid off the mortgage ten years ago. It’s a recurring cost that greatly influences where people choose to settle, and depending on your ZIP code, that tax bill can be a minor annoyance or a major financial hardship.

Where you live means how much that bill hurts. Residents in some states do not pay anything, while others carry tax burdens that conflict with the second lien.

Analysts at WalletHub examined all 50 states and the District of Columbia to determine the applicable property tax rates across the country. They looked at the taxes paid compared to the total value of the home to find out who gets hit the hardest – and who gets a break.

Why doesn’t the lowest rate guarantee the cheapest bill

A low percentage looks good on paper, but your actual bill depends entirely on the value of your home. Everything from local amenities to how political signals affect property value can play a role in that final assessment.

Hawaii is a perfect example. It boasts the lowest effective tax rate in the country. However, the average home price in Hawaii is much higher than the national average. When you apply that small 0.27% rate to your home equity, your real estate tax increases quickly. The average homeowner in Hawaii pays several thousand dollars a year in property taxes.

Compare that to Alabama, which has the second lowest effective tax rate of 0.38%. Because the median home value in Alabama is so much lower than the national average, the average homeowner there pays less than $1,000 a year. That makes Alabama the cheapest state for property taxes in terms of actual out-of-pocket expenses.

10 states with the lowest property taxes

Homeowners seeking relief from heavy tax burdens will find the best rates in South and West. These 10 states have the lowest effective property tax rates in the country.

The estimates below show annual taxes for a home with a national median price of $332,700.

• 1. Hawaii: At just 0.27%, this state has the lowest effective property tax rate in the country. For a median-priced home, you’ll pay $888 a year.
• 2. Alabama: With a rate of 0.38%, homeowners here pay the lowest green fees in the nation. The median home tax is $1,249.
• 3. Nevada: The 0.47% tax rate keeps property costs manageable for residents, totaling $1,549 for the average home.
• 4. Arizona (tie): Homeowners face an effective rate of 0.48%, resulting in $1,585 per year.
• 4. Colorado (tie): To match Arizona, the rate remains at 0.48%, costing homeowners $1,605.
• 4. South Carolina (tie): The last position in this three-way tie also charges 0.48%, which translates to $1,607 per year.
• 7. Idaho: The effective property tax rate is 0.49%, leaving homeowners with a $1,620 bill.
• 8. Delaware (tie): Residents pay an effective rate of 0.50%, or $1,671 for the average home.
• 8. Tennessee (tie): To match Delaware, the rate is exactly 0.50%, resulting in a tax bill of $1,673.
• 10. Utah: Rounding out the bottom 10, the state charges a rate of 0.52%, which costs $1,717 a year.

10 states with the highest property taxes

Living in the Northeast or parts of the Midwest comes with a steep premium. These states impose very heavy tax burdens on their residents.

• 10. Iowa: Rounding out the ten most expensive, homeowners pay an average of 1.39%, resulting in a $4,634 bill for the average home.
• 9. Wisconsin: The state levies an effective property tax of 1.42%. The annual tax sits at $4,734.
• 7. Texas (tie): The state charges an effective rate of 1.49%, costing homeowners $4,961.
• 7. Nebraska (tie): Tied with Texas, residents also pay 1.49%, which translates to a $4,949 bill.
• 6. New York: The effective rate remains at 1.55%, leaving residents with a tax burden of $5,167.
• 5. Vermont: Homeowners face an effective tax rate of 1.59%, which equates to $5,295 per year.
• 4. New Hampshire: The state makes up for its lack of income tax with a high property tax rate of 1.66%, which is worth $5,511.
• 3. Connecticut: Residents pay a 1.81% tax on their homes, resulting in a $6,024 bill.
• 2. Illinois: In a close second, the state charges an effective rate of 2.01%, leaving homeowners paying $6,694.
• 1. New Jersey: Leading the nation, homeowners here face a staggering 2.11% property tax rate. For the average household, the debt exceeds $7,022.

Looking at the complete tax picture

You can’t make real estate decisions based on property taxes alone. Countries need to fund their schools, roads and emergency services somehow. If the state doesn’t collect that money through property taxes, it will get it elsewhere.

Many states with low property taxes charge high income taxes or sales taxes to make up the difference. On the other hand, states with aggressive property tax bills often give residents a break in other areas. New Hampshire has some of the highest property taxes in the country, but does not charge a regular sales tax or state income tax on wages.

Before you pack up and cross state lines to escape the painful property tax, you should calculate the total cost of living. Check for state tax, local sales tax, and daily cost of goods. A cheap tax bill means nothing if all your housing and living expenses consume your entire budget.