States With the Lowest Property Taxes

Look at property taxes by state if you're considering buying.

Depending on where you live, you can escape taxes like income tax and sales tax in the U.S. Property taxes, however, are not the same. And no matter where you settle down, you’ve got to cough up some amount come tax season.

That being said, you can minimize property taxes’ effect on your finances. Property tax rates vary significantly across the U.S., not just state-by-state, but county-by-county within states. In all calculations of property tax, the amount comes down to a percentage of your home’s assessed value.

Keep reading to see how your state’s property taxes measure up against the cheapest rates in the U.S.

Best States for Property Taxes

GOBankingRates conducted a study to determine which states had the lowest property taxes. The study was based on two principal factors: the average effective state property tax rate and the median amount paid annually in property taxes. States were given a score and then ranked in descending order, with the No. 1 state having the lowest property taxes.

The top seven states with the lowest property taxes are as follows:

  1. Alabama
  2. Louisiana
  3. Hawaii
  4. West Virginia
  5. South Carolina
  6. Arkansas
  7. Delaware

Low property taxes are great when your focus is saving money. However, property taxes are also a crucial source of revenue for localities and state governments. They’re responsible for funding public schools and the quality of education received.

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7 States With the Lowest Property Taxes

Read on to get more details about the states with the lowest property taxes.

7. Delaware

Average state property tax rate: 0.529% of assessed home value

Median real estate taxes paid: $1,274

Delaware is a prime state to get into now if you’re buying a home. With the fourth-lowest state property tax, homeowners won’t pay much. On a related note, in a recent study, Delaware ranked second in the U.S. for the state where home values are appreciating the most.

6. Arkansas

Average state property tax rate: 0.619% of assessed home value

Median real estate taxes paid: $721

Low tax rates and low home values make Arkansas a very affordable state in terms of property taxes. Across the state, county rates are all below 1 percent. The highest tops out at just 0.80 percent in Pulaski County, and the lowest rate is 0.39 percent in Stone County.

Understand: 6 Things Every Homeowner Should Know About Property Taxes

5. South Carolina

Average state property tax rate: 0.574% of assessed home value

Median real estate taxes paid: $821

South Carolina has the sixth-lowest average state property tax rate at 0.574 percent. Based on Zillow’s median home value, $159,100 as of June 2018, you’d pay about $913 annually in taxes. At these rates, you could by a second house in Hilton Head, S.C., ranked the best place in the state to own a vacation home.

4. West Virginia

Average state property tax rate: 0.589% of assessed home value

Median real estate taxes paid: $629

West Virginia is rapidly rising as a state for prospective homeowners. The average state tax rate is seventh lowest nationally, and cheap home prices keep real estate taxes low, at just $629 a year. It’s no surprise that West Virginia is the No. 2 best state for first-time homebuyers.

3. Hawaii

Average state property tax rate: 0.278% of assessed home value

Median real estate taxes paid: $1,459

Hawaii boasts the lowest average effective property tax rate in the whole study at a mere 0.278 percent. Based on a median home value of $615,700, however, you’ll have to pay about $1,712 in property taxes, which is close to what people pay in Florida and North Dakota, where tax rates exceed 1 percent.

2. Louisiana

Average state property tax rate: 0.479% of assessed home value

Median real estate taxes paid: $750

The U.S. South was heavily represented in the top 10 states, especially the Deep South. Louisiana has the third-lowest property tax rate in the U.S., plus affordable homes to keep annual taxes to a minimum. These factors and others help make it one of the best states to buy your first home.

1. Alabama

Average state property tax rate: 0.435% of assessed home value

Median real estate taxes paid: $550

Boasting the least amount paid in real estate taxes and the second-lowest average property tax rate, Alabama took first place fairly easily. Alabama’s median home value, $126,800, is the fifth lowest, which makes for very cheap property taxes, and contributes a more affordable cost of living than most states in the U.S.

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See the full rankings of all the states:

State Property Taxes
RankStateState Effective Property Tax RateMedian Real Estate Taxes Paid
1Alabama0.435%$550
2Louisiana0.479%$750
3Hawaii0.278%$1,459
4West Virginia0.589%$629
5South Carolina0.574%$821
6Arkansas0.619%$721
7Delaware0.529%$1,274
8Wyoming0.623%$1,223
9Mississippi0.784%$841
10Colorado0.624%$1,516
11Tennessee0.748%$1,088
12New Mexico0.724%$1,232
13Utah0.688%$1,508
14Idaho0.771%$1,276
15Kentucky0.837%$1,078
16Oklahoma0.868%$1,076
17Indiana0.876%$1,100
18Arizona0.845%$1,367
19North Carolina0.855%$1,345
20Nevada0.921%$1,478
21Montana0.870%$1,698
22Georgia0.957%$1,413
23Virginia0.797%$1,973
24District of Columbia0.572%$2,811
25Missouri1.004%$1,408
26Florida1.100%$1,702
27North Dakota1.221%$1,729
28California0.813%$3,237
29Minnesota1.190%$2,234
30Oregon1.076%$2,637
31Washington1.083%$2,860
32South Dakota1.356%$1,943
33Maine1.271%$2,329
34Maryland1.085%$3,191
35Iowa1.470%$1,986
36Alaska1.209%$3,048
37Kansas1.587%$1,890
38Ohio1.553%$2,064
39Pennsylvania1.506%$2,603
40Massachusetts1.181%$4,132
41Michigan1.833%$2,185
42Nebraska1.879%$2,506
43Texas1.931%$2,654
44Rhode Island1.610%$3,929
45Vermont1.719%$3,893
46Wisconsin1.969%$3,257
47New York1.578%$4,738
48Illinois2.253%$4,058
49Connecticut1.910%$5,443
50New Hampshire2.104%$5,241
51New Jersey2.293%$7,601

Click through to read more about the tax breaks every first-time homebuyer must know.

More on Taxes

Methodology: GOBankingRates determined the states with lower property taxes based on the following factors: (1) effective state property tax rate, sourced from SmartAsset; (2) real median real estate taxes paid in each state, sourced from the Census Bureau’s 2016 American Community Survey.