Every week, Mansion Global poses a tax question to real estate tax attorneys. Here is this week’s question.
Q. What states have the highest and lowest property taxes?
A. New Jersey had the highest property taxes in the U.S. again in 2020, according to a report this week from WalletHub.
The state has a 2.49% effective tax rate, and the median home value is $335,600, according to the report. That means homeowners there pay about $8,362 on a property valued at that amount.
Connecticut paid the second-highest amount, $5,898, and had a 2.14% effective tax rate, the report found. There, the median home value was $275,400. New Hampshire had the third-most expensive property taxes, with homeowners seeing a $5,701 bill on a property with a median price of $261,700. The effective tax rate there was 2.18%.
New York, Illinois and California are also in the top 10 states with the highest property taxes in 2020, with homeowners paying $5,407, $4,419 and $3,818, respectively.
Nationally, property taxes are fairly high overall, said WalletHub analyst Jill Gonzalez.
“The average American household spends $2,471” in property taxes, she said in an email. “Even though no one is exempt from paying property taxes, location is very important in determining how big your burden will be.”
The nation’s lowest property taxes can be found in Alabama, which had a 0.41% effective tax rate last year, the data showed. There, the median price of a home was $142,700, and owners paid $587 annually.
Hawaii had the lowest effective property tax rate, 0.28%, but since the median home value was $615,300, the annual tax bill was about $1,715, according to the report.
Florida ranked in the middle of the list, with a 0.89% effective tax rate. The median home price there was $215,300, which would have a $1,914 tax bill.
Low, or lower, property taxes, have caused many U.S. citizens to move from high-tax states in recent years. Ms. Gonzalez expects that trend to not only continue, but accelerate.
“We could be seeing more of this migration now, considering that people have also been severely affected financially by the lockdown,” she said.
The report determined the highest and lowest property taxes by comparing data from the U.S. Census Bureau for the 50 states and Washington, D.C.
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