Property tax burdens vary widely as states debate senior relief

Property taxes can feel like a minor nuisance in some states and a crushing expense in others — a reality detailed in a new WalletHub analysis.

The average U.S. household pays $3,119 per year in property taxes, according to U.S. Census Bureau data cited in the report.

Even renters are affected. Roughly 35% of households rent, but property taxes are often built into rental costs and remain a primary funding source for state and local governments.

“Some states charge no property taxes at all, while others charge an arm and a leg,” WalletHub analyst Chip Lupo said. “Americans who are considering moving and want to maximize the amount of money they take home should take into account property tax rates, in addition to other financial factors like the overall cost of living, when deciding on a city.”

WalletHub ranked states by effective real estate property tax rates and calculated annual bills — using the national median home value of $332,700 in 2024 (the most recent available data) and each state’s median home value.

Hawaii ranked first with the lowest effective rate at 0.27%, translating to $888 on a $332,700 home. Because Hawaii’s median home value is $839,100, the typical annual bill there is $2,239.

WalletHub

Alabama followed at 0.38%, or $1,249 on a $332,700 home. Nevada ranked third at 0.47%, or $1,549. Arizona, Colorado and South Carolina were next at 0.48%.

Idaho placed seventh at 0.49%, while Delaware and Tennessee tied at 0.5%. Utah rounded out the top 10 at 0.52%.

At the high end, New Jersey ranked last with an effective rate of 2.11%, with homeowners paying $7,022 on a $332,700 home and $9,590 on the state’s median home value of $454,400.

Illinois followed at 2.01%, or $6,694. Connecticut ranked 49th at 1.81%, or $6,024. New Hampshire was 48th at 1.66%, or $5,511.

Texas and Nebraska tied at 1.49%, equating to $4,961 and $4,949, respectively, on a $332,700 home. New York ranked 46th at 1.55%, or $5,167.

The wide variation has fueled new proposals aimed at easing the burden — particularly for seniors.

Tennessee proposal targets full senior reimbursement

In Tennessee, Rutherford County Property Assessor Rob Mitchell recently unveiled the Tennessee Golden Homeowners Tax Relief Program.

That proposal would fully reimburse property taxes on primary residences for qualifying residents ages 65 and older who have maintained continuous in-state residency for at least 20 years.

Mitchell said the program’s cost would equal about 3% of Tennessee’s annual state budget and could be funded by the state’s recurring surplus, estimated at $1.5 billion to $2.5 billion per year.

“The money is there. The question is priority,” he said. “If Tennessee can afford to give $1 billion annually in tax cuts to big business, we can certainly afford to protect the seniors who built our communities and have been paying into the system for decades.”

Under current law, Tennessee reimburses qualifying low-income elderly and disabled homeowners for part of their property tax bills. That program, administered by the state comptroller’s office, distributes more than $40 million annually to more than 100,000 residents.

Mitchell argued the expanded plan would help prevent tax foreclosures and allow seniors to redirect limited income toward local goods, services and health care.

Supporters are circulating a petition on Change.org to build momentum for legislative action.

Texas, Florida, Ohio weigh sweeping changes

Elsewhere, lawmakers are considering broader overhauls.

In Texas, Lt. Gov. Dan Patrick announced “Operation Double Nickel,” which would lower the age for senior property tax benefits from 65 to 55.

According to his website, the proposal “would accelerate school property tax cuts, reduce school property taxes and freeze appraised values for more than 3.3 million homeowners, forever, by taking the current over-65 freeze on taxable value down to homeowners 55 and over.”

Qualifying homeowners would see school–related property tax valuations frozen at age 55.

Seniors already receive a partial school-tax exemption that was recently increased from $10,000 to $60,000. Patrick said the new proposal would save eligible Texans about $900 to $1,000 per year — or up to $10,000 if they’re between the ages of 55 and 65.

He also proposed increasing homestead exemptions by another $40,000 — raising the exemption to $180,000 for non-seniors and $240,000 for Texans 55 and older.

Under the plan, a senior with a $300,000 home would be taxed as if it were worth $60,000 instead of $100,000.

“In the last several years, the average Texas homeowner has saved $2,000 on their property taxes by homestead exemptions going up and some compression that we work in there. But that’s not enough, and we all know that’s not enough,” Patrick said.

In Florida, House Republicans advanced proposals that would eliminate or phase out non-school property taxes over 10 years — including a measure targeting residents 65 and older.

The Florida Policy Institute estimates a $43 billion funding gap under the House proposals.

In Ohio, Gov. Mike DeWine is reviewing five property tax bills approved by the Republican-controlled legislature.

Those measures would allow county officials to scale back previously approved levies, restrict tax bill growth to inflation and shift the burden of proof in valuation disputes.

As states debate relief, property taxes remain a central — and increasingly political — part of the cost of living.