Living here will drain your wallet faster than you think.
Owning a home can feel like the ultimate achievement—until you get slapped with a property tax bill that makes your jaw drop. Some states are notorious for charging sky-high rates, eating away at your savings and making homeownership feel like a financial trap. If you’re not careful, you could end up spending thousands more than expected every year, just to keep the roof over your head.
Not all states are created equal when it comes to property taxes. While some places keep rates low to attract new residents, others offset their lack of income tax or other revenue streams by hitting homeowners where it hurts.
Before settling down, take a closer look at these 13 states where property taxes are through the roof—you might just decide to look elsewhere.
1. New Jersey punishes homeowners with the highest property tax rates in the country.
If you live in New Jersey, brace yourself for some of the most brutal property tax bills in America. The state leads the nation in property tax rates, with homeowners paying an average of 2.21% of their home’s value each year. That means a house worth $400,000 comes with an annual tax bill of nearly $9,000—enough to make you rethink your decision to settle in the Garden State. The high cost is largely due to the state’s reliance on property taxes to fund its school systems, infrastructure, and public services, as reported by Jonathan Jones of Construction Coverage.
It doesn’t help that New Jersey’s cost of living is already sky-high. Even if you’re earning a comfortable salary, a hefty tax bill can quickly eat into your budget, making it tough to save for the future. Many residents who reach retirement age find themselves packing up and heading to more tax-friendly states. If you’re looking for long-term financial stability, you may want to cross New Jersey off your list.
2. Illinois homeowners get squeezed by excessive tax burdens.
Illinois is another state where property taxes are a serious financial burden. The average effective tax rate hovers around 2.05%, which means you could be paying thousands of dollars each year just to own a home. While Illinois doesn’t have the highest home values, the percentage residents pay in property taxes is staggering, according to to Elissa Chudwin of AARP. Many homeowners in the state feel trapped by ever-rising tax rates, especially as local governments struggle to cover pension obligations and other financial woes.
The situation isn’t improving anytime soon. Even with efforts to reform the system, Illinois continues to rely heavily on property taxes to fund its schools and public services. This has led to a steady stream of residents fleeing for lower-tax states, particularly retirees who can’t justify the expense. If you’re thinking about settling in Illinois, be sure to factor in the long-term cost of property taxes—it could make a major dent in your financial plans.
3. New Hampshire makes up for no income tax with hefty property bills.
New Hampshire might lure you in with the promise of no state income tax, but don’t be fooled—homeowners pay for it in other ways. The property tax rate in this picturesque New England state is one of the highest in the country, averaging around 1.96%. That means even if you’re saving on income tax, your annual property tax bill could easily offset those savings, leaving you no better off financially, as stated by Paul Briand of NH Business Review.
Unlike many other states, New Hampshire depends heavily on property taxes to fund schools, roads, and public services. There’s no statewide sales tax either, which forces local governments to squeeze homeowners even harder to generate revenue. The result? Property taxes that continue to climb year after year. If you’re drawn to the state’s natural beauty and outdoor lifestyle, be sure to calculate just how much owning a home here will cost you in the long run.
4. Connecticut homeowners get hit with relentless property tax hikes.
Connecticut is another state that puts a serious dent in homeowners’ wallets with high property tax rates. The average effective rate sits at about 2.14%, making it one of the most expensive places in the country to own property. With housing prices already on the higher end, these taxes can add up to tens of thousands of dollars per year, making affordability a real challenge for many residents.
What makes matters worse is the state’s ongoing fiscal problems. Connecticut has struggled with pension debt and budget deficits for years, and local governments frequently raise property taxes to make up the difference. That means even if you buy a home at a seemingly reasonable tax rate, you could see your bill rise significantly over time. If you’re looking for financial predictability, this might not be the place to plant roots.
5. Vermont drains homeowners with ever-increasing property tax rates.
Vermont is known for its beautiful landscapes and quaint small towns, but those scenic views come at a cost. The state has one of the highest property tax rates in the U.S., averaging around 1.82%. Given that Vermont has a relatively small population and a high demand for public services, homeowners often bear the brunt of the financial burden through increasing tax rates.
One of the biggest drivers of Vermont’s high property taxes is its education funding system, which places a significant portion of the cost on homeowners. Despite attempts to reform the system, taxes remain a major concern for residents. If you’re thinking about buying a home in Vermont, be prepared to pay a premium—not just for the house itself, but for the annual taxes that come with it.
6. Texas tricks homeowners with no income tax but sky-high property rates.
Texas proudly boasts no state income tax, but don’t expect to escape high property taxes. The average effective property tax rate in Texas sits at around 1.68%, which might not sound bad until you realize how much home values have skyrocketed. As property prices rise, so do the tax bills, leaving many homeowners with hefty payments each year.
The reason for these high rates? Texas relies heavily on property taxes to fund public schools and local governments, since there’s no income tax to fill the gap. That means if you’re living in a high-demand area like Austin, Dallas, or Houston, your property tax bill could be shockingly high. While Texas remains an attractive place for businesses and job seekers, the property tax burden is something every potential homeowner should consider before making the move.
7. Wisconsin homeowners feel the sting of unrelenting property taxes.
Homeownership in Wisconsin comes with a tax burden that many residents find hard to stomach. The state’s property tax rate averages around 1.63%, making it one of the highest in the Midwest. While Wisconsin doesn’t have the same home price inflation as states like Texas or California, the high percentage of tax means homeowners still pay a significant amount each year.
One of the biggest frustrations for Wisconsin residents is how persistent tax hikes seem to be. Even if property values don’t skyrocket, tax rates continue to climb, leaving many homeowners with bills they didn’t anticipate. With local governments dependent on property taxes to fund schools and infrastructure, there’s little relief in sight. If you’re considering Wisconsin for its natural beauty and affordability, make sure you account for the long-term cost of property taxes in your budget.
8. Nebraska surprises homeowners with unexpectedly high tax rates.
Nebraska might not be the first state that comes to mind when you think of high property taxes, but homeowners here pay more than they might expect. The average property tax rate hovers around 1.61%, which doesn’t sound outrageous until you realize that the cost of homeownership in Nebraska keeps rising. Even in smaller cities and rural areas, residents are feeling the weight of property taxes creeping higher each year.
A major reason for Nebraska’s steep property tax rates is its lack of other revenue sources. The state relies heavily on property taxes to fund public schools, local governments, and infrastructure. Unlike some states that balance things out with higher sales taxes or an income tax, Nebraska keeps squeezing homeowners to make up the difference. If you’re planning to settle down here, be sure to factor in the long-term impact of property tax increases—they aren’t slowing down anytime soon.
9. Rhode Island might be tiny, but its property taxes are anything but.
Don’t let Rhode Island’s small size fool you—owning property here comes with some big tax bills. With an average property tax rate of around 1.63%, homeowners pay thousands of dollars every year just to keep their homes. And since home prices in Rhode Island have risen steadily, the actual tax burden continues to climb, leaving many residents frustrated.
One of the biggest reasons property taxes are so high in Rhode Island is the state’s heavy reliance on them for funding public services. Unlike some neighboring states that spread out their tax burden, Rhode Island puts much of the financial pressure directly on homeowners. Whether you’re eyeing a beachside property or a cozy suburban home, expect to budget extra for property taxes that seem to rise year after year.
10. Michigan keeps homeowners locked in a cycle of rising property taxes.
Michigan might have affordable home prices compared to other states, but its property taxes tell a different story. The state’s average tax rate sits at about 1.54%, which means even moderately priced homes come with a significant tax bill. While some areas have managed to keep property values in check, others—especially in growing suburbs—are seeing tax rates climb higher than expected.
One reason for Michigan’s high property tax burden is the way local governments rely on these taxes to fund public education and infrastructure. Homeowners often find themselves in a frustrating cycle of reassessments that lead to higher payments, even if their home’s market value hasn’t increased much. If you’re planning to buy property in Michigan, be prepared for ongoing tax hikes that can make long-term budgeting a challenge.
11. Ohio homeowners pay more than they bargain for in property taxes.
Ohio might be known for its reasonable cost of living, but its property tax rates tell a different story. Homeowners in the Buckeye State pay an average tax rate of around 1.58%, making it one of the pricier states for property taxes. While home values in Ohio aren’t as high as in coastal states, the tax burden can still add up quickly, especially for those in more desirable areas.
Local governments in Ohio depend on property taxes to fund schools and public services, which means rates aren’t likely to decrease anytime soon. In fact, many homeowners find themselves paying more each year due to frequent reassessments and increasing tax levies. If you’re considering Ohio as a place to settle down, make sure to account for property taxes—they might be higher than you expect.
12. Iowa quietly drains homeowners with its hefty property taxes.
Iowa often flies under the radar when it comes to high property taxes, but homeowners here pay an average rate of 1.57%. That might not seem excessive at first glance, but when you factor in the overall cost of homeownership, the numbers start to add up quickly. Many residents find that their annual tax bills are far higher than they initially anticipated.
A major reason for Iowa’s high property tax burden is its funding structure for local schools and public services. Unlike some states that rely more on sales or income taxes, Iowa leans heavily on property taxes to cover the costs of essential services. Homeowners are often frustrated by rising assessments that lead to larger tax bills year after year. If you’re thinking about settling in Iowa, take a close look at the property taxes before making any final decisions.
13. Pennsylvania homeowners pay more than they expect in taxes.
Pennsylvania has plenty to offer with its mix of rural charm and city life, but property taxes here can be a tough pill to swallow. The average tax rate hovers around 1.49%, meaning homeowners often pay thousands of dollars each year just to stay put. While the state’s housing market is relatively affordable compared to the East Coast, property tax bills make it less budget-friendly than it first appears.
A big part of the issue is Pennsylvania’s reliance on property taxes to fund public schools. Many school districts continually increase rates to cover their budgets, leaving homeowners with higher bills every year. Even retirees, who might expect some relief, often find themselves paying steep property taxes well into their later years. If you’re considering Pennsylvania for its affordability, be sure to factor in the full cost of homeownership—including taxes that seem to never stop rising.