Generally speaking, property taxes are based on the tax rate AND the assessor's valuation of the property. In almost every state, except California, if a local government needs more money for their budget, they can (and often do) reassess properties at values sufficiently high enough to meet their spending needs. This is primarily why it's misleading to look only at the tax rate to determine your real property tax liability. You also have to look at your district's assessment valuation practices.
This is why Prop 13 is a great benefit for homeowners in California, a state where property values can increase at double digit rates for multiple years at a time. Prop 13 fixes the assessed value at the price you paid for your home and increases it by a maximum of 2% per year. It also fixes the tax rate at 1%. Other special assessments can be added to the rate but they are generally nominal.
Why am I wrong to be disappointed that your graphic lacked information for all 50 states?
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Four out of the five are blue (exception N Hampshire) the socialistic democrats are terrible with finance and ruin everything they touch when it comes to money. Here we show more proof.
Utter nonsense. Alaska also has very high real estate taxes.
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I felt compelled to give the lowlights from New Jersey as we are being slowly crushed to death by our taxes. I live in a wonderful northern NJ town (commuter town to NYC) in one of the smallest houses around (assessed at $450k) and pay $13k in taxes a year. That, sadly, is considered a bargain. Many houses by us pay double that, or more. The schools are ok. The services, eh. But we have to pay for things like our own sidewalk repairs. (!) New governor wants to keep raising taxes. People are fleeing as soon as they retire or their kids graduate from high school. There are too many towns and not enough shared services. Eventually towns will have to consolidate to mitigate this tax burden. We could afford a bigger house but I refuse to pay more in taxes! I have no point to my rambling other than to say NJ’s taxes are even worse than they appear here.
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Property taxes usually pay for schools and paying off bonds to improve local infrastructures. In most states property taxes and state income taxes are inversely correlated.
Here in Santa Fe, property taxes are ridiculously low, and the schools are bad, no surprise. But the state income tax is also very low, so there is little available to improve NM. The University of New Mexico has long been called The University of No Money, and the entire post-secondary education establishment is so overbuilt that the funds available are spread paper-thin.
One-third of the state budget comes from taxes on oil&gas, so of course that industry has everything to say about how the state is run, pollution be damned. When o&g turns down, NM is in a world of hurt. A terrible way to run a state economy.
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This is grossly misleading, as in many urban areas the property taxes may be 2-4 times higher than the so-called average. So, my home is assessed at $192K, a little above the median home value for Louisiana. But I'm paying $2900 in taxes with a homestead exemption and an assessment freeze due to my age. Wish I could pay closer to $750 when pigs begin to fly..........
In the State of New York, however, my adult children's houses, combined, pay much less tax than does my one house here. Who in the heck in Louisiana are paying $750 or less in property tax? Am I being scammed?
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New Hampshire has no state income tax but they have to get that money from somewhere...
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While good people can debate the issue of raising or lowering taxes, it is interesting to note that the high tax states have great medical care and general higher standards of living while DC, La, Ala have some of the worst health care and standard of living (Delaware is a tax haven for the rich and Hawaii is in the middle of no where).
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How come Texas is not there? The rate is over 3%. With no income tax all are hit with high property tax regardless of their income.
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My house(2 -family) in north shore suburban Milwaukee has the numbers almost exactly mimicing the NJ values shown here. I paid $90K for the duplex about 30 years ago. We paid off the note 10 years ago. The costs then for the property tax alone is approx $21.00/day. Utilities are extra of course. We don't have renters but could rent one of the units for approx $1300-1400/mo. My kids, when they were school age, could walk to all the schools/grades in one of the highest rated school systems in WI. I can walk to Lake Michigan and all essential services (banks, grocery, coffeee shops, restaurants etc) in less than 15 mins. Even in rush hour traffic we can be downtown in about 15 mins. My wife and I are retired and so housing costs are important to keep low. Raw numbers are difficult to sort through and are relevant only in the context of "what you get for your money". We plan on aging in this house as it would be very hard to approximate this quality of life anywhere else for similar costs, if we chose to sell. I could do without the brutal WI winters for 6 mos of the year but no place is perfect and FL is a 3-1/2 hr plane ride away.
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As some mentioned it before, within many states there is a large variation in property (real estate) taxes from one location to another.
So a state by state comparison may not be a good guide.
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"Sorry renters, there’s no escape: Your landlord’s property taxes are almost certainly passed on to you in your rent."
Not really. Your rent is a function of what the market will bear. If your landlord's property taxes go down, your rent isn't going down. If the market will stand a rent increase, your landlord will increase the rent regardless of property taxes.
Aslo, when is the last time anyone who rented gave a shirt about a building's property taxes?
The quote shows a poor understanding of basic economics.
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You have to look at the whole tax picture. Some states with high property taxes have no income taxes.
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Does not mean much. I pay over 5X more in property taxes than in state income tax.
Since, in Minnesota at least, property taxes are based on local (city), county, and school district rates, it would be impossible to extrapolate from that a "statewide" rate. An average, yes. But that means little when comparing rural MN with the metropolitan area in and round Minneapolis and St. Paul. The state does not have any input on the property taxes. Other states certainly could be different, but that is what makes it very difficult to compare between states; different methods yield differing results.
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This really doesn't mean much unless you figure in local income taxes.
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Interesting chart. In the case of California, though, "effective tax rate" doesn't include supplemental parcel taxes on the bills, which are an effect of Proposition 13. As an example, on a modest home just listed in my neighborhood for $1.6 million, the homeowners, who owned it for more than 50 years, payed a tax bill last year of $5000. The buyer of that house will immediately be in line for an annual bill starting at $24,000, which includes the base tax rate of $21K plus another $3K in supplemental taxes. Huge disparity, and it shows how much Prop. 13 has skewed things towards the Boomer generation.
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I have to question your data. I live in upstate NY, and In 2017 I paid approximately $6,900 in property taxes on a house assessed at approximately $175,000. That would equate to a tax bill of $11,800 on a home assessed at $300,000 vs. the $7,200 you cite for New Jersey.
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I echo your question -- on my house in upstate/western NY, assessed at $140,000, I paid almost $6,000 last year in combined school and county/town taxes (and that's even after the discount I received through the state's "Star" rebate program on school taxes). That makes a tax rate around 4 percent, higher than the list. Please footnote how WalletHub defines and what it includes in "property taxes."
I believe these are just state tax rates. In most states there are also local taxes, as well as bond payments. The real elephant in the room is state (and I guess in some cases city) income taxes. New Hampshire, for example, has no income taxes, which is why its state property taxes are so high.
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At least in NY state there is no such thing as state property tax. There is county/town/library/fire district/sewer-water district (where I live), payable in February, and school tax due in the fall. School tax is over 50% more than the town+ taxes.
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