- The amount you pay in property taxes can greatly vary depending on where you live.
- Median real estate taxes paid can range from the low hundreds to over $7,000.
- Although the locations of the states with the lowest property taxes ranged across the country, the South had many ranking in the best 10 states for lowest property taxes.
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:
- West Virginia
- South Carolina
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.
7 States With the Lowest Property Taxes
Read on to get more details about the states with the lowest property taxes.
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.
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.
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.
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.
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.
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.
See the full rankings of all the states:
|State Property Taxes|
|Rank||State||State Effective Property Tax Rate||Median Real Estate Taxes Paid|
|24||District of Columbia||0.572%||$2,811|
Click through to read more about the tax breaks every first-time homebuyer must know.
More on Taxes
- A Guide to US Post Office Hours and Tax Deadlines on Tax Day
- Everything You Need to Know About Tax Changes for 2018
- Follow This One Tip to Be Financially Successful
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.