In the US, each state has different tax rates. Before purchasing a property, property tax for the real estate has to be taken into account with your investment. In this article, the list of the states with the highest and lowest real estate tax rates are provided.
Four states with the lowest property tax rates:
Hawaii: The lowest property tax rate in the US is Hawaii. It also has the highest median home value for which the home owners may still have to pay a substantial tax bill.
Alabama: Next on the list is Alabama, with being the most affordable state for homeowners in the US. It has both a low tax rate along with a low median home price.
Louisiana: After Alabama, it is the third state with a low property tax rate. It also has low median home values. Resources like gas are also comparatively cheap, taxes at only 20 cents per gallon.
Wyoming: The effective property tax of Wyoming is low compared to other states. Wyoming also has the lowest sales tax and no income tax. If you are considering all the types of tax rates before purchasing a property, Wyoming is a good option.
Besides these, the top 10 states with the lowest effective tax are West Virginia, South Carolina, Colorado, Delaware, Utah, and Arkansas.
Four states with the highest property tax:
New Jersey: New Jersey is one of the most expensive states to live in the US. With 2.49% property tax, it is a good option for families with children because 60% of the tax revenue is spent on funding education.
Illinois: Illinois is the second state in the list with the highest property tax in the US. It has a low median house value of $229,866. It ranks with high economic development and is popular for its quality of education.
New Hampshire: With a property tax rate of 2.18%, New Hampshire is the third state on the list. Here, you do not need to pay income tax or sales tax. The local government collects most of the revenue from the property tax. Besides tax, local funding is the other way for development for the state.
Connecticut: Next on the list is Connecticut, with a 2.14% tax on properties. Similar to the other states I just mentioned, Connecticut’s property taxes make the most revenue for the local government. However, Connecticut does not have a fixed caps on the increase of rates, unlike its neighboring states like New York. The other six states that make to the top 10 highest states with property taxes are Vermont, Wisconsin, Texas, Nebraska, Ohio, and Rhode Island.
