Property taxes are one of the largest recurring expenses for homeowners, so choosing a state with lower property taxes can make a huge difference. The amount of property taxes you pay depends largely on the effective property tax rate in your area. This rate is calculated by dividing the annual tax payment by the home’s value, giving homeowners a clear picture of their tax obligations relative to the value of their property. In 2024, several states stand out for their notably low property tax rates, providing an advantage to residents seeking to minimize this cost.
Here, we take a closer look at the 10 U.S. states with the lowest property taxes in 2024, ranked by their effective property tax rate. Each state’s property tax structure reflects a combination of local policies, state-level regulations, and regional economic factors.
States With the Lowest Property Taxes
Here’s a table summarizing the Effective Property Tax Rate, Average Annual Property Tax, and Median Home Value for the 10 states with the lowest property taxes in 2024:
| State | Effective Property Tax Rate | Average Annual Property Tax | Median Home Value |
|---|---|---|---|
| Hawaii | 0.29% | $1,715 | $587,700 |
| Alabama | 0.41% | $646 | $157,100 |
| Colorado | 0.51% | $2,269 | $443,100 |
| Louisiana | 0.55% | $890 | $161,800 |
| District of Columbia | 0.56% | $4,497 | $809,100 |
| Delaware | 0.57% | $1,545 | $270,000 |
| South Carolina | 0.57% | $1,155 | $203,100 |
| West Virginia | 0.58% | $726 | $127,300 |
| Wyoming | 0.61% | $1,403 | $231,200 |
| Arkansas | 0.62% | $776 | $126,500 |
1. Hawaii
- Effective Property Tax Rate: 0.29%
- Average Annual Property Tax: $1,715
- Median Home Value: $587,700
Hawaii consistently boasts the lowest property taxes in the United States, with an effective tax rate of only 0.29%. This means that for a median home value of $587,700, residents pay approximately $1,715 annually in property taxes. While the low property tax rate is a significant advantage for homeowners, Hawaii’s high home prices may offset this benefit for some buyers.
Despite its low property taxes, Hawaii’s cost of living remains high due to other factors like real estate prices and general living expenses. The state compensates for its lower property tax revenues by relying more heavily on income and excise taxes. Property tax rates are kept low to maintain affordability for homeowners in a state where real estate is otherwise very expensive.
2. Alabama
- Effective Property Tax Rate: 0.41%
- Average Annual Property Tax: $646
- Median Home Value: $157,100
Alabama ranks as one of the most affordable states for property taxes. With an effective property tax rate of 0.41%, homeowners in Alabama pay significantly less compared to other states. For instance, a home valued at the median price of $157,100 would result in an annual property tax bill of approximately $646.
This low tax rate is maintained by a combination of state laws and local policies that limit property tax assessments. Alabama’s reliance on other tax sources, such as sales and income taxes, helps to keep property taxes low. This system has made Alabama an attractive destination for retirees and budget-conscious homeowners looking for lower homeownership costs.
3. Colorado
- Effective Property Tax Rate: 0.51%
- Average Annual Property Tax: $2,269
- Median Home Value: $443,100
Colorado offers an effective property tax rate of 0.51%, which is considerably low given the rising real estate market in popular cities like Denver. The average homeowner in Colorado pays about $2,269 annually in property taxes on a median home valued at $443,100.
Colorado’s property tax system is shaped by the Gallagher Amendment, which limits residential property assessments, helping keep tax rates favorable for homeowners. Additionally, the state relies on a mix of revenue from other sources, such as income taxes, to fund public services without placing too much burden on homeowners. As a result, Colorado remains a popular destination for homebuyers looking for affordability combined with high quality of life.
4. Louisiana
- Effective Property Tax Rate: 0.55%
- Average Annual Property Tax: $890
- Median Home Value: $161,800
Louisiana’s property taxes are among the lowest in the country, thanks in part to its homestead exemption program, which reduces the taxable value of homes. The effective property tax rate of 0.55% means that homeowners with a median-priced home of $161,800 pay about $890 annually in property taxes.
The state’s homestead exemption allows homeowners to exempt up to $75,000 of their property’s value from taxes, making Louisiana particularly attractive for those looking to reduce their tax burden. While property taxes are low, residents do pay higher rates in other forms of taxation, including sales and income taxes. Nonetheless, the affordability of property ownership in Louisiana makes it a top choice for families and retirees alike.
5. District of Columbia
- Effective Property Tax Rate: 0.56%
- Average Annual Property Tax: $4,497
- Median Home Value: $809,100
While Washington, D.C., isn’t technically a state, it stands out for having one of the lowest property tax rates in the country at 0.56%. However, due to the high median home value of $809,100, the average property tax bill still amounts to $4,497 per year.
The District of Columbia’s relatively low property tax rate, combined with its proximity to major urban centers, makes it attractive for homebuyers, though the higher home prices can balance out the tax savings. D.C.’s tax system focuses on progressive income taxes and other local revenue sources, allowing property taxes to remain low despite the region’s high cost of living.
6. Delaware
- Effective Property Tax Rate: 0.57%
- Average Annual Property Tax: $1,545
- Median Home Value: $270,000
Delaware offers homeowners an effective property tax rate of 0.57%, resulting in an annual tax payment of $1,545 on a home valued at $270,000. This low rate is part of the state’s broader strategy to keep overall living costs manageable for residents.
Delaware’s property tax system benefits from its reliance on other tax revenues, such as corporate taxes, which allows it to maintain lower taxes for homeowners. With affordable housing options and favorable tax policies, Delaware is particularly appealing to retirees, who flock to the state to take advantage of its low taxes and coastal lifestyle.
7. South Carolina
- Effective Property Tax Rate: 0.57%
- Average Annual Property Tax: $1,155
- Median Home Value: $203,100
South Carolina maintains a low effective property tax rate of 0.57%, which amounts to around $1,155 in annual taxes for a median-priced home of $203,100. This state is a great option for homebuyers looking for a lower cost of living, especially those considering retiring in the southeastern U.S.
In South Carolina, the state’s reliance on sales and income taxes helps to keep property taxes low. The affordability of homeownership, coupled with favorable weather and a lower cost of living, makes South Carolina an increasingly popular destination for retirees and families alike.
8. West Virginia
- Effective Property Tax Rate: 0.58%
- Average Annual Property Tax: $726
- Median Home Value: $127,300
West Virginia offers homeowners one of the lowest property tax rates in the country, with an effective tax rate of 0.58%. This means homeowners with a median-priced home of $127,300 pay just $726 annually in property taxes, making West Virginia one of the most affordable states for homeownership.
Low property taxes are a key factor that attracts retirees and budget-conscious families to West Virginia. The state relies on other forms of taxation and natural resource revenues to keep property taxes low. Combined with a lower cost of living, West Virginia offers great value for homeowners looking for affordability and natural beauty.
9. Wyoming
- Effective Property Tax Rate: 0.61%
- Average Annual Property Tax: $1,403
- Median Home Value: $231,200
Wyoming’s effective property tax rate of 0.61% results in an average annual tax bill of $1,403 for a median home valued at $231,200. Wyoming is known for its favorable tax policies, which include no state income tax, making it a particularly attractive state for both businesses and individuals.
The state’s low property tax rate is supported by revenues from natural resource extraction, such as oil and gas, which allows Wyoming to maintain minimal taxes on residents. With a combination of low property taxes and no state income tax, Wyoming remains a desirable destination for those looking for tax advantages.
10. Arkansas
- Effective Property Tax Rate: 0.62%
- Average Annual Property Tax: $776
- Median Home Value: $126,500
Arkansas rounds out the list with an effective property tax rate of 0.62%, which results in an annual tax bill of approximately $776 for a median-priced home of $126,500. Arkansas offers some of the most affordable property taxes in the country, making it an attractive state for first-time homebuyers and retirees alike.
The state keeps property taxes low by relying more on sales and income taxes for revenue. Arkansas’ affordability extends beyond just property taxes, with low housing costs and a lower cost of living overall. For homebuyers looking for value, Arkansas presents a compelling option.
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