First, which state has the highest property taxes?
As of 2016, New Jersey.
According to WalletHub, in 2016 New Jersey had the highest real estate taxes in the country, with homeowners paying out 2.29 percent of their property values. So, for homes that were at the state median value of $319,000, owners paid out a whopping $7,335.
But prices like that might be par for the course for states in that region, says WalletHub Analyst Jill Gonzalez. “A lot of Northeast states are known for their higher property taxes–and they’re also known for the many great amenities they provide.”
Among other states within this property tax range, Illinois came in a close second to New Jersey with a property tax rate of 2.25 percent. New Hampshire charged 2.1 percent, and Wisconsin was at 1.97 percent.
Although these states are considered to have high property tax rates, there are trade-offs that can benefit residents. For instance, New Hampshire’s 2.1 percent tax rate can be offset by the fact that the state has lower home prices and NO sales or income taxes. Some states with what are considered to be higher property taxes tend to have LOWER income or sales taxes, but might levy surcharges for things like gas and cigarettes.
It tends to be the opposite for states with lower property taxes. Many times these states can have higher income or sales tax.
So, the answer as to whether or not you should avoid the states with the highest property taxes is: there is no cut-and-dried answer.
Urban-Brookings Tax Policy Center Senior Research Associate Norton Francis says, “Every state has their own mixture of taxes that they rely on.”
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