Cheapest property tax by state: 2024-2025 rates ranked

Last updated 2026-07-09

Which states have the lowest property taxes?

Hawaii, Alabama, Nevada, Louisiana, and Wyoming land in the bottom five for effective residential property tax rates almost every year. Effective rate means annual taxes paid divided by market value. That's the only honest way to compare states, because each one sets its own assessment ratio and its own exemption rules.

The Tax Foundation's 2024 analysis puts Hawaii at 0.27%, Alabama at 0.37%, Nevada at 0.48%, Louisiana at 0.51%, and Wyoming at 0.52% ^[1]. Those figures come from the American Community Survey's owner-reported tax and home-value data, so they reflect what real owners paid, not what the statute claims.

Rankings shift a little by source. The Lincoln Institute of Land Policy publishes its own estimates and sometimes puts Colorado or South Carolina ahead of Nevada ^[12]. Nobody has one perfect dataset here. The closest thing to a consensus is that the six lowest states are Hawaii, Alabama, Nevada, Louisiana, Wyoming, and either Colorado or South Carolina depending on the year.

Hawaii is the outlier every source agrees on. A 0.27% rate on a $700,000 Honolulu condo produces a $1,890 tax bill. The same home in New Jersey at 2.23% costs $15,610 a year ^[1]. That is an eight-fold gap on an identical asset.

State-by-state property tax rate comparison

The table below ranks median effective residential property tax rates for all 50 states, lowest to highest. Data comes from the Tax Foundation's 2024 report using 2022 American Community Survey figures, the most recent full dataset available at publication ^[1].

Rank	State	Effective Rate	Median Annual Tax
1	Hawaii	0.27%	$1,971
2	Alabama	0.37%	$587
3	Nevada	0.48%	$1,736
4	Louisiana	0.51%	$983
5	Wyoming	0.52%	$1,380
6	South Carolina	0.53%	$962
7	Colorado	0.54%	$2,017
8	West Virginia	0.55%	$694
9	Utah	0.56%	$1,837
10	Arkansas	0.57%	$762
11	Arizona	0.59%	$1,648
12	Idaho	0.64%	$1,817
13	Tennessee	0.65%	$1,153
14	California	0.71%	$4,279
15	New Mexico	0.73%	$1,359
16	Mississippi	0.75%	$1,009
17	Montana	0.76%	$2,049
18	North Carolina	0.80%	$1,583
19	Virginia	0.82%	$2,829
20	Indiana	0.85%	$1,308
21	Delaware	0.86%	$1,570
22	Georgia	0.86%	$1,822
23	Kentucky	0.86%	$1,257
24	Oklahoma	0.87%	$1,278
25	Florida	0.91%	$2,143
26	Oregon	0.91%	$3,261
27	Washington	0.98%	$4,170
28	Missouri	1.01%	$1,547
29	North Dakota	1.01%	$1,893
30	Minnesota	1.02%	$2,915
31	Alaska	1.04%	$3,791
32	Maryland	1.07%	$3,633
33	South Dakota	1.14%	$2,285
34	Maine	1.14%	$2,756
35	Massachusetts	1.17%	$5,091
36	Kansas	1.33%	$2,235
37	Iowa	1.43%	$2,241
38	Michigan	1.54%	$2,551
39	Pennsylvania	1.58%	$3,022
40	Ohio	1.59%	$2,447
41	Texas	1.60%	$3,797
42	Nebraska	1.61%	$2,851
43	Wisconsin	1.73%	$3,905
44	New York	1.73%	$5,884
45	Vermont	1.90%	$4,135
46	New Hampshire	1.93%	$6,097
47	Illinois	2.08%	$4,942
48	Connecticut	2.15%	$6,153
49	New Jersey	2.23%	$8,797

A few notes on reading this. Alabama's $587 median bill looks impossibly low, but it's real, because Alabama's median home value sits around $157,000, well under the national median. Hawaii's $1,971 median bill looks reasonable until you remember the median Hawaii home is worth over $730,000. Low rate, high prices.

Colorado's rate was held down for years by the Gallagher Amendment before voters repealed it in 2020. Expect Colorado rates to drift up over the next few assessment cycles ^[2].

Why is Hawaii's property tax so low?

Hawaii's low rate is a structural choice, not a loophole. The state funds most public services, including all of K-12 education, at the state level through income and general excise taxes. That leaves local governments with little reason to lean on the property tax the way New Jersey or Illinois counties do ^[3].

Hawaii also splits properties into tiers. Owner-occupied residential property in Honolulu County pays a rate around $3.50 per $1,000 of assessed value in fiscal year 2024, while investment and commercial property pays $12.40 per $1,000 ^[3]. That gap matters. Visitors and investors effectively subsidize local homeowners.

One trap to watch. Hawaii assesses at 100% of fair market value. Some other low-rate states look cheap on paper only because they assess at 10% or 20% of market value, which inflates the statutory rate. Check the effective rate, never the statutory one.

What makes Alabama's property taxes so cheap?

Alabama has the lowest effective rate in the contiguous 48 states at 0.37%. Three things drive it: a low fractional assessment ratio, constitutional caps, and wide exemptions.

Alabama assesses residential property at 10% of market value. A $200,000 home gets an assessed value of $20,000. The millage rate applies to that $20,000, not the full $200,000 ^[4]. That ratio alone cuts the effective tax to a sliver of what the nominal millage suggests.

The state homestead exemption removes another $4,000 from assessed value for every owner-occupant. Homeowners over 65 with income below $12,000 can qualify for a full property tax exemption on their primary residence under Alabama Code Section 40-9-21 ^[4]. That's a complete exemption, not a partial one.

The tradeoff is funding. Alabama ranks near the bottom nationally on per-pupil school spending, and the link between rock-bottom property taxes and thin local services is direct. Moving to Alabama purely for the tax bill? Factor in school quality, road budgets, and library hours first.

How do commercial property tax rates compare by state?

Commercial rates diverge from residential rates far more than most owners expect. Many states set higher assessment ratios for commercial and industrial property than for owner-occupied homes. That's called classification, and it shifts the burden onto businesses.

Minnesota is one of the most aggressive classifiers. Commercial and industrial property is assessed at 1.5% of market value for the first $150,000 and 2.0% above that, against 1.0% for residential homesteads ^[5]. Own a small strip mall in Hennepin County and your effective rate can run two to three times what your neighbor pays on the house next door. The Hennepin County property tax breakdown shows how that plays out locally.

New York City pushes classification further. Class 4 commercial property carries an assessment ratio of 45% of market value, while Class 1 one-to-three family homes are capped at 6% ^[6]. The NYC property tax system is one of the most complicated in the country.

Texas has no income tax, so property taxes fund almost everything local. Commercial rates vary by county and taxing district, but the effective rate on commercial real estate often lands between 1.8% and 2.5% depending on location ^[7]. The Dallas suburbs, including Collin County property tax and Williamson County property tax, have seen fast assessment growth as those markets appreciated.

Florida assesses commercial property at the same 100% of just value as residential, but commercial owners don't get the Save Our Homes cap that limits annual homestead assessment increases to 3%. That cap is arguably Florida's biggest subsidy, and it goes only to homeowners. See Miami-Dade property taxes for the ground-level version.

California's Proposition 13 caps assessment increases at 2% a year for every property type until a sale or new construction triggers reassessment, which has helped long-held commercial property enormously. Proposition 15, which would have carved commercial property out of Prop 13, failed at the 2020 ballot. California commercial property still gets the same acquisition-value protection as a house, for now ^[8]. For two of the state's priciest markets, the Santa Clara property tax and San Mateo County property tax pages cover Silicon Valley.

Does a low property tax rate actually mean a low tax bill?

Not automatically. Three variables sit between the rate and your bill, and each can move the number hard: the assessment ratio, the exemptions you qualify for, and the assessed value itself.

Assessment ratio is the share of market value the government officially uses to tax you. Alabama uses 10% for residential. Illinois targets 33.3% statewide, though Cook County ratios ran far above legal limits for years before a court-ordered reform started in 2022 ^[9]. California uses 100% but caps annual growth at 2% under Prop 13 ^[8].

Exemptions carve thousands off the taxable base before the rate touches it. A $50,000 homestead exemption in Florida removes $50,000 from assessed value, saving a homeowner in a high-millage county $1,000 or more a year. Senior, veteran, disability, and agricultural exemptions each work differently by state.

The assessed value itself may be wrong. Assessors work at scale. Mass appraisal models miss a bad roof, a cracked foundation, a flood zone designation, or a plain data entry error. In a rising market, assessed values lag and then jump when the reassessment cycle catches up.

Here's the blunt version. A low rate in a low-exemption, high-assessment state can cost more than a high rate in a high-exemption, low-assessment state. You need all three numbers to know your real burden.

Which high-tax states give you the most ways to lower your bill?

New Jersey, Illinois, New York, and Connecticut carry high rates, but they also run formal appeal processes with real teeth. New Jersey lets you appeal directly to the county tax board within 45 days of the mailing of your assessment notice, or by April 1, whichever comes later, and the process is built to work without a lawyer ^[10].

Illinois gives most counties two appeal levels: the county assessor first, then the Board of Review. Cook County alone handles tens of thousands of appeals a year. The Cook County Assessor publishes comparable sale data, and appeals are genuinely open to homeowners who put in the time to find good comps ^[9].

New York's grievance process opens every year on Grievance Day, the fourth Tuesday in May in most municipalities, though some vary ^[6]. You file Form RP-524 with the Board of Assessment Review. It runs two pages.

Texas belongs here too, even though its effective rate isn't top-tier. Texas requires no evidence filing to trigger a hearing. Show up with a printed comp sheet and argue your case in front of an appraisal review board in under 30 minutes. Millions of Texans do it every year ^[7].

If you're in a high-tax state and haven't appealed in the last two years, you're probably overpaying. The TaxFightBack appeal kit walks you through finding comps and building evidence state by state, so you keep the full savings instead of handing 25% to a contingency firm.

How does property tax funding differ between low-tax and high-tax states?

The core difference is what the property tax pays for and whether the state covers part of the tab.

Hawaii funds about 90% of K-12 education directly from state revenue. Local property taxes cover modest county services and little else ^[3]. New Jersey property taxes fund roughly 60% of local school budgets, which is exactly why the rates run so high. The state has tried repeatedly to restructure school funding to ease property owners, and the politics keep stalling it ^[10].

This is why raw rate comparisons are only the start. A Texas homeowner paying 1.6% owes no state income tax but pays for nearly everything local through property. A California homeowner paying 0.71% also pays up to 13.3% in state income tax. Oregon has no sales tax, so property and income taxes fill the gap.

For investors running a property tax rate comparison by state, funding structure tells you how stable the rates are. Where property taxes fund core services, rate cuts are unlikely, because any cut opens a direct funding hole. Where property taxes only supplement other revenue, there's more room to adjust.

What states have property tax freezes or circuit breakers for seniors?

Roughly 18 states run some form of property tax circuit breaker for senior homeowners, meaning a program that caps the tax as a share of income or freezes the assessed value at a fixed point in time.

South Carolina freezes the assessed value of a primary residence for homeowners over 65 or those who are permanently disabled. Once you qualify under SC Code Section 12-37-3135, your taxable assessed value stays at the level it was when you first qualified, no matter how much the market climbs ^[11]. In a fast-appreciating market, that's one of the most valuable senior benefits in the country.

Tennessee's County Property Tax Relief program pays qualifying seniors a rebate of up to $125 a year, modest but stackable with other exemptions. New York's School Tax Relief (STAR) program is more generous. Enhanced STAR delivers a direct credit worth hundreds to thousands of dollars a year depending on school district ^[6].

Texas freezes the school district portion of the property tax bill for homeowners over 65, which is a big deal, because school taxes often run 50% to 60% of the total Texas bill ^[7].

If you're 65 or older and haven't enrolled in your state's senior program, that's likely the highest-return hour you can spend on your property taxes. Applications are usually one page, filed with the county assessor or tax commissioner.

How do you actually appeal a property tax assessment in a low-tax state?

Every state has an appeal process, even Hawaii and Alabama where the overall burden is low. A low rate says nothing about whether your individual assessment is accurate.

The process runs four steps almost everywhere. Get your assessment notice and look up the assessor's stated value on the county portal. Find recent sales of comparable homes within the last 6 to 12 months, ideally within a half mile, similar in square footage, age, and condition. Calculate what your home is worth using those comps, then compare it to the assessed value. If the assessed value sits more than 5% above what your comps support, file the appeal form before the deadline.

Deadlines are the killer. Miss by one day and you usually wait a full year. Honolulu County's appeal deadline is April 9 of the tax year, and other Hawaii counties vary ^[3]. Alabama deadlines vary by county but generally fall in the January to April window after October notices ^[4]. New Jersey's is April 1 in most cases ^[10].

For comps, pull sales from your county assessor's site, Zillow's recently sold filter, or Redfin. You don't need an appraisal. You need a table of five to ten sales that support a lower value, each with address, sale date, sale price, square footage, and price per square foot.

The TaxFightBack DIY appeal kit includes state-specific deadline calendars and evidence templates, so you walk into your hearing with a clean package instead of a Zillow printout. You keep 100% of the reduction.

For a city-level view of the evidence and filing steps, the LA County property tax and Contra Costa County property tax pages show how California's Prop 13 framework meets the appeals system.

Is it worth appealing in a low-tax state?

Yes, if the assessed value is wrong, which it often is. A 10% over-assessment on a $400,000 Alabama home, with its 10% assessment ratio, costs you about $148 a year in extra taxes. Modest. The same 10% error on a $500,000 New Jersey home costs about $1,115 a year.

The math is simpler than people think. If your state's effective rate is below 0.6%, appeal every two to three years rather than annually, and keep your time investment proportional. Above 1.0%, appealing every cycle, and appealing promptly, almost always pays for the few hours it takes.

One honest note. In some rural low-tax counties, the Board of Review is three elected local citizens who know your neighbor and the assessor personally. The formal process still applies and your comps still matter, but the informal dynamics of a small-county hearing differ from a big urban appeals board. Clean, documented evidence counts for even more there, because you're replacing personal relationships with paper facts.

Frequently asked questions

What is the lowest property tax state in the US?

Hawaii has the lowest effective residential property tax rate at roughly 0.27% of market value, per the Tax Foundation's 2024 analysis using American Community Survey data. Alabama is second at 0.37%, then Nevada at 0.48%. Hawaii's low rate applies to high home values, though, so the actual dollar bill can still run into the thousands.

Which states have no property tax?

No state fully eliminates property tax. All 50 states let local governments levy it to fund schools and services. States like Alabama and Hawaii have very low effective rates. Alaska and some rural Montana counties have minimal or zero state-level property tax, but county and municipal levies still apply. There is no truly tax-free option anywhere.

What state has the highest property tax?

New Jersey has the highest effective residential rate at about 2.23% and the highest median annual bill at roughly $8,797, per Tax Foundation 2024 data. Connecticut and Illinois follow at 2.15% and 2.08%. High rates in these states mostly reflect heavy reliance on property taxes to fund local schools.

How does Texas property tax compare to other states?

Texas sits in the upper-middle range at about 1.60% effective rate, ranking 41st from lowest to highest. Texas has no state income tax, so property taxes carry a heavy load for schools and local services. The median annual Texas bill runs around $3,797. Texans can protest their appraisal every year, and millions do.

What states have the cheapest commercial property taxes?

For commercial property, the lowest-burden states tend to be those without classification systems that surcharge business property. Hawaii, Alabama, and Nevada rank well for commercial too. California's Proposition 13 has historically helped long-held commercial property. Minnesota, New York, and Massachusetts apply higher assessment ratios specifically to commercial and industrial property, pushing those bills up.

Can I appeal my property tax assessment even in a low-tax state?

Yes. The appeal right exists regardless of the overall state rate. If your individual assessed value exceeds market value, you can appeal. File before the county deadline, typically 30 to 90 days after notices are mailed. You need comparable recent sales showing your property is over-assessed. Even in Alabama or Nevada, a successful appeal saves real money every year until the next reassessment.

Does moving to a low-tax state actually save money on property taxes?

It can, but home prices and other taxes matter too. Hawaii has the lowest rate and some of the highest home prices. Alabama has low rates and low home values, which genuinely produces low bills. The tradeoff is total burden. Texas has moderate property rates but no income tax, while California has lower property rates but high income taxes. Compare total state and local tax burden, not property rates alone.

What is the property tax rate for seniors in Florida?

Florida offers several senior benefits. The standard homestead exemption is $25,000, plus another $25,000 for assessed values above $50,000. Homeowners over 65 with household income below roughly $35,167 (adjusted annually) may qualify for an additional exemption up to $50,000 under Florida Statute 196.075. Some counties add a local senior exemption. The base rate varies by county and taxing district.

How often do states reassess property values?

Cycles vary widely. California only reassesses on sale or new construction. Hawaii and Texas reassess annually. Massachusetts reassesses annually in most cities. Many states run two-year or four-year cycles. Frequent reassessment in a rising market means your bill climbs faster, but it also means a price drop shows up in your assessment sooner.

What is an effective property tax rate versus a nominal rate?

The nominal rate is the statutory millage applied to assessed value. The effective rate is actual tax paid divided by market value. They diverge when a state assesses at less than 100% of market value. Alabama's nominal rates look high (around 10 mills) but the 10% assessment ratio makes the effective rate 0.37%. Compare effective rates when running a cross-state property tax comparison.

Are property taxes deductible on federal taxes?

Yes, but the 2017 Tax Cuts and Jobs Act capped the state and local tax (SALT) deduction at $10,000 a year for individuals and married couples filing jointly. That cap limits the federal benefit for homeowners in New Jersey, Illinois, and New York who often pay well above $10,000 in property taxes alone. The SALT cap is scheduled to expire after 2025 unless Congress extends it.

Do commercial property taxes follow the same rates as residential in every state?

No. Many states classify commercial property separately and apply higher assessment ratios or rates. Minnesota, New York, Massachusetts, and Illinois all put a heavier burden on commercial and industrial property than on owner-occupied homes. States without classification, including most Southern states and California, apply the same ratio to both. Check your state's classification rules before estimating a commercial tax burden.

How do I find my property's current assessed value?

Your county assessor's website is the fastest source. Search by address or parcel number. Most counties post assessed value, the assessment ratio, exemptions applied, and the current year's tax. If the site is clunky, your annual assessment notice or tax bill also shows assessed value. Some states post this through a statewide portal rather than individual county sites.

What documentation do I need to appeal a property tax assessment?

Three things: the official appeal form from your county assessor or appeals board, evidence of comparable sales (five to ten recent sales of similar nearby properties), and your assessment notice. Photos of condition problems, a recent private appraisal if you have one, and a simple table showing your estimated market value against the assessed value all strengthen the case.

Sources

1. Tax Foundation, Property Taxes by State and County 2024: Hawaii effective property tax rate 0.27%, New Jersey 2.23%, and state-by-state effective rate rankings using American Community Survey data
2. Colorado General Assembly, Amendment B (Gallagher Amendment repeal, 2020): Amendment B repealed the Gallagher Amendment in 2020, removing the residential/nonresidential assessment ratio caps that had held down Colorado residential rates
3. Hawaii Department of Taxation and Honolulu Real Property Assessment Division: Hawaii funds most public services including K-12 education at the state level; Honolulu owner-occupied residential rate about $3.50 per $1,000, commercial $12.40 per $1,000 in FY2024; assessment at 100% of market value; Honolulu appeal deadline April 9
4. Alabama Department of Revenue, Property Tax Division: Alabama assesses residential property at 10% of fair market value; homestead exemption of $4,000; Alabama Code Section 40-9-21 provides full exemption for qualifying seniors over 65 with income below $12,000
5. Minnesota Department of Revenue, Property Tax Classification Rates: Minnesota commercial and industrial property assessed at 1.5% for first $150,000 and 2.0% above that; residential homestead at 1.0%
6. New York State Department of Taxation and Finance, Property Tax Overview: NYC Class 4 commercial assessment ratio 45% of market value; Class 1 residential capped at 6%; Grievance Day falls on the fourth Tuesday in May in most NY municipalities; RP-524 is the standard grievance form; STAR and Enhanced STAR credits
7. Texas Comptroller of Public Accounts, Property Tax Basics: Texas property is appraised annually at 100% of market value; property owners may protest annually; school district taxes frozen for homeowners 65 and older
8. California Board of Equalization, Proposition 13 Overview: California Proposition 13 limits assessment increases to 2% per year for all property types until sale or new construction triggers reassessment; Proposition 15 failed in November 2020
9. Cook County Assessor's Office, Assessment and Appeal Information: Cook County handles tens of thousands of residential appeals per year; comparable sale data is publicly available through the assessor's office; court-ordered reassessment reform began 2022
10. New Jersey Division of Taxation, Property Tax Appeals: New Jersey county tax board appeal deadline is April 1 or 45 days after mailing of assessment notice; appeals can be filed without an attorney; property taxes fund roughly 60% of local school budgets
11. South Carolina Legislature, SC Code Section 12-37-3135: SC Code 12-37-3135 freezes assessed value for primary residences owned by persons over 65 or permanently disabled at the year of first qualification regardless of subsequent market appreciation
12. Lincoln Institute of Land Policy, Significant Features of the Property Tax database: Multi-state comparison of assessment ratios, classification systems, and effective property tax rates; independent source corroborating lowest-rate state rankings