10 States With the Highest Property Tax: Know Before Buying

New Jersey tops the list with the highest effective property tax rate in the nation. Homeowners here pay around 2.2 percent of their home's value every year in property taxes. That means a house worth $400,000 comes with an annual bill of nearly $9,000.

Local governments use this tax revenue to fund schools, police departments and other public services.

Illinois isn’t far behind, with an effective tax rate just under 2.1 percent. Property taxes in some parts of Illinois—such as Lake County in the Chicago metro area—exceed 2.6 percent, contributing to the state’s high overall rate.

Local tax assessors determine assessed value based on market value, and even small increases in housing prices can significantly affect tax bills.

In Connecticut, high property values plus high property tax rates equal high property tax bills. Residents pay about 2 percent of their home's value annually.

Property taxes vary between towns, but many communities lean on residential property taxes to fund everything from emergency services to schools.

New Hampshire ranks high in property taxes partly because it doesn’t have a state income tax or general sales tax. That means local governments lean harder on property tax revenue. New Hampshire’s effective property tax rate is about 1.77 percent.

Vermont rounds out the top five with an effective property tax rate of about 1.71 percent. The state uses property taxes to fund education more than most states, tying the tax burden to school funding formulas. Homestead exemptions may reduce the bill for primary residences.

Texas has no state income tax, so it relies heavily on property taxes to support local services. Effective property tax rates in Texas average about 1.58 percent, but they can vary significantly by county.

Local property tax rate decisions depend on needs like funding fire departments or local schools.

Wisconsin homeowners face an effective property tax rate of about 1.51 percent. While local sales taxes and income taxes exist, the property tax burden plays a major role in funding local government services. Menominee County often sees some of the highest property taxes in the state.

Property taxes paid in Nebraska are steep due to a combination of high mill rates and lack of state-level property tax relief. Nebraska’s average effective property tax rate is about 1.50 percent, often surprising to new homeowners unfamiliar with the local tax structure.

Ohio’s effective property tax rate is roughly 1.36 percent. While property tax exemptions help reduce costs for certain groups (like senior citizens or veterans with military service) the overall tax burden remains high for most residents.

Rhode Island rounds out the top 10 with an effective property tax rate of about 1.32 percent. Despite its small size, the state collects a significant amount in property taxes annually. The local level control over tax rates means different property tax rates exist even within short distances.

We created this article in conjunction with AI technology, then made sure it was fact-checked and edited by a HowStuffWorks editor.