U.S. cities with the highest property taxes

By: The Roofstock Team

Depending on local tax rates and home values, property taxes can account for a substantial portion of housing costs. According to the latest data from the U.S. Census Bureau, the median annual property tax paid by homeowners was $2,578 in 2019, or 1.03 percent of home value, but many households pay far more than this. Further, beginning in 2018, the SALT tax cap began limiting the amount of state and local taxes that could be deducted against federal income taxes. Consequently, living in a high-tax state has become increasingly more expensive.

Census Bureau data shows that in aggregate, property taxes are the biggest source of tax revenue for state and local governments. Nationally, state and local property taxes totaled $617 billion in 2019, or 39 percent of total state and local government tax revenue. Property tax revenue amounted to $159 billion more than the next largest state and local government tax revenue source, individual income taxes.

Property tax rates vary widely by location, making some parts of the U.S. far more expensive to live. While property taxes are levied in different ways based on local and state laws, a helpful way to compare tax burdens across locations is to calculate an effective property tax rate by dividing the total property taxes paid by the aggregate value of homes in a given area.

At the state level, Americans living in New Jersey and Illinois tend to pay the most in property taxes relative to home values. These states have the highest effective property tax rates, at 2.42 and 2.16 percent, respectively. On the other hand, people living in Hawaii and Alabama have much lower property tax bills, with effective property tax rates of 0.40 and 0.28 percent. While the total amount of property tax paid is a function of both tax rates and home values, residents in states with high effective property tax rates also tend to pay the most in absolute terms. For example, the typical New Jersey homeowner paid an astonishing $8,432 in property taxes last year, the highest in the country.

To determine the cities with the highest and lowest property taxes, our researchers analyzed the latest housing data from the U.S. Census Bureau. Cities were ranked according to their effective property tax rate, measured as aggregate real estate taxes paid divided by the aggregate value of homes. Researchers also calculated median property taxes paid, median home value, and median household income for owner-occupied homes.

To improve relevance, only cities with at least 100,000 people were included in the analysis. Additionally, cities were grouped into the following cohorts based on population size:

Small cities: 100,000–149,999
Midsize cities: 150,000–349,999
Large cities: 350,000 or more

Here are the small and midsize cities with the highest property taxes.

Large cities with the highest property tax rates

1. Milwaukee, Wisconsin

Effective property tax rate: 2.17%
Median property taxes paid: $3,122
Median home value: $133,600
Median household income (owner-occupied homes): $66,465

2. El Paso, Texas

Effective property tax rate: 2.13%
Median property taxes paid: $3,136
Median home value: $133,600
Median household income (owner-occupied homes): $61,830

3. Fort Worth, Texas

Effective property tax rate: 1.86%
Median property taxes paid: $4,155
Median home value: $209,400
Median household income (owner-occupied homes): $85,273

4. San Antonio, Texas

Effective property tax rate: 1.85%
Median property taxes paid: $3,260
Median home value: $171,100
Median household income (owner-occupied homes): $70,938

5. Arlington, Texas

Effective property tax rate: 1.75%
Median property taxes paid: $3,889
Median home value: $213,800
Median household income (owner-occupied homes): $83,119

6. Omaha, Nebraska

Effective property tax rate: 1.71%
Median property taxes paid: $3,283
Median home value: $175,800
Median household income (owner-occupied homes): $82,650

7. Columbus, Ohio

Effective property tax rate: 1.62%
Median property taxes paid: $2,776
Median home value: $173,300
Median household income (owner-occupied homes): $77,951

8. Austin, Texas

Effective property tax rate: 1.53%
Median property taxes paid: $6,616
Median home value: $378,300
Median household income (owner-occupied homes): $114,776

9. Cleveland, Ohio

Effective property tax rate: 1.51%
Median property taxes paid: $1,508
Median home value: $71,100
Median household income (owner-occupied homes): $47,562

10. Dallas, Texas

Effective property tax rate: 1.49%
Median property taxes paid: $3,840
Median home value: $231,400
Median household income (owner-occupied homes): $77,286

Large cities with the lowest property tax rates

1. Colorado Springs, Colorado

Effective property tax rate: 0.48%
Median property taxes paid: $1,375
Median home value: $318,200
Median household income (owner-occupied homes): $89,230

2. Denver, Colorado

Effective property tax rate: 0.49%
Median property taxes paid: $2,118
Median home value: $447,500
Median household income (owner-occupied homes): $103,069

3. Mesa, Arizona

Effective property tax rate: 0.57%
Median property taxes paid: $1,343
Median home value: $259,300
Median household income (owner-occupied homes): $77,774

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4. San Francisco, California

Effective property tax rate: 0.57%
Median property taxes paid: $7,678
Median home value: $1,217,500
Median household income (owner-occupied homes): $151,654

5. Phoenix, Arizona

Effective property tax rate: 0.58%
Median property taxes paid: $1,537
Median home value: $266,600
Median household income (owner-occupied homes): $80,217

6. Washington, District of Columbia

Effective property tax rate: 0.58%
Median property taxes paid: $3,647
Median home value: $646,500
Median household income (owner-occupied homes): $147,678

7. Boston, Massachusetts

Effective property tax rate: 0.58%
Median property taxes paid: $3,667
Median home value: $627,000
Median household income (owner-occupied homes): $132,762

8. Las Vegas, Nevada

Effective property tax rate: 0.59%
Median property taxes paid: $1,698
Median home value: $305,900
Median household income (owner-occupied homes): $81,125

9. Aurora, Colorado

Effective property tax rate: 0.60%
Median property taxes paid: $1,793
Median home value: $343,000
Median household income (owner-occupied homes): $87,867

10. Nashville-Davidson, Tennessee

Effective property tax rate: 0.60%
Median property taxes paid: $1,797
Median home value: $287,300
Median household income (owner-occupied homes): $83,852

Detailed findings & methodology

During the COVID-19 pandemic, remote work has become the new norm for many workers, with over 40 percent of the U.S. labor force working from home full-time. It is likely that many workers will continue working from home at least part of the time even after the pandemic. The shift towards remote work provides a new level of flexibility for homeowners to relocate from high- to low-tax states, regardless of where their employer is based.

Although the majority of large cities with the highest effective property tax rates are located in Texas, Milwaukee claims the top spot with an effective property tax rate of 2.17 percent, over twice the national effective property tax rate of 1.03 percent. In addition to Texas, Illinois, New Jersey, and Connecticut claim many of the small and midsize cities with the highest property taxes, with effective property tax rates that are several times higher than the national rate. Indeed, three small cities in New Jersey and Connecticut have effective property tax rates over 3.0 percent. The median property taxes paid is nearly $9,000 in Elizabeth, NJ, the small city with the highest effective property tax rate.

To determine the cities with the highest property taxes, researchers at Roofstock analyzed the latest data from the U.S. Census Bureau’s 2019 American Community Survey. Cities were ranked according to their effective property tax rate, measured as aggregate real estate taxes paid divided by the aggregate value of homes. In the event of a tie, the city with higher aggregate real estate taxes paid was ranked higher. Researchers also calculated median property taxes paid, median home value, and median household income for owner-occupied homes.