States with the Lowest Property Taxes

Hawaii has the lowest effective property tax rate in this 2024 Census ACS comparison, at 0.27% of median home value. The ranking is a state-level benchmark, not a local tax-bill quote; county rates, exemptions, and assessment rules can differ.

No. Every jurisdiction in this 2024 Census ACS state comparison has a positive effective property-tax rate. The lowest-rate state is Hawaii at 0.27%; a low effective rate is not the same as no property tax.

Property taxes are determined locally, but state-level policies shape the overall burden in several ways. States with alternative revenue sources, oil severance taxes in Alaska and Wyoming, tourism taxes in Hawaii and Nevada, lottery and gambling revenue, need less from property taxes. States with strong income or sales taxes can substitute those for property tax revenue. Assessment caps (like California's Proposition 13) limit taxable values. And states with lower spending on public education, which accounts for the largest share of property tax spending in most states, tend to have lower property tax rates.

Not necessarily. Many states compensate for low property taxes with higher income taxes, higher sales taxes, or higher fees for services. New Hampshire has no income or sales tax but is among the highest property tax states. Tennessee has no income tax on wages and low property taxes, but a high sales tax. Wyoming has low property taxes and no income tax, but high severance taxes on mineral extraction fund state services. Always consider the full tax burden, not just property taxes in isolation.

California's Proposition 13 (passed in 1978) caps property tax increases at 1% of assessed value at purchase, with maximum annual increases of 2% per year regardless of market appreciation. This means a California homeowner who purchased decades ago can have a very low effective tax rate compared to a neighbor who recently purchased at a higher price. The result is that California's effective rate (0.68-0.73%) is well below the national average despite having some of the highest home values in the country. New homeowners pay market-value assessments, while long-term owners may pay a fraction of what current market values would imply.

Yes. Most states offer homestead exemptions for primary residences, these reduce the assessed value used to calculate taxes. Common exemptions include: homestead exemptions (20,000-50,000+ off assessed value in many states), senior citizen exemptions (available in most states, often starting at age 65), veteran exemptions, disability exemptions, and agricultural land use exemptions. Texas offers both a homestead exemption and an over-65 school tax freeze. Check your county assessor's website or state revenue department for available exemptions, many are not automatically applied and require an application.

On a hypothetical $400,000 home, the gap between this comparison's lowest- and highest-rate states is about $7,360 a year before local exemptions or assessment rules. It is only an illustration, not a relocation recommendation: compare the specific county, current assessment, other taxes, housing costs, and services before making a decision.