COVID-19 has expanded everyone’s options on where to live, and the answer to where you should live now may have to do with where has the lowest property taxes.
Previously, being close to your job was the number one priority.
Now, remote work is more available than ever.
You can live across the country from your job, and it’s no problem at all.
So, with that, people are relocating.
They’re asking themselves, “Where do I want to live and why?”
If you’re doing research because you’re moving or purchasing a new property, then you’ll want to look at the list below.
Here are the top US states with the lowest property taxes in 2023.
What Are Property Taxes?
Property taxes are taxes paid by a real estate owner to either the country or the local authorities.
This money goes toward the community to support things like infrastructure improvements, public services, and local public schooling.
The tax amount is based on the assessed value of your home.
It varies based on your state’s rate.
Most U.S. homeowners will need to pay property taxes every month in combination with their mortgage payments.
Thus, you must think about them before you purchase real estate because it’ll add to your costs.
If you pay off your mortgage in its entirety, you’ll receive a bill for your property taxes from the local government throughout the year.
What Are Rates Based On?
Property taxes are based on your home’s assessed value.
Your home’s assessed value may match its actual value, but this isn’t typical.
There’s often a gap between the assessed value and the actual value, which can impact the tax amount.
Additionally, the land itself and the structures that exist on it will dictate the overall value of your land.
Furthermore, where you live (state and county) can affect the property taxes of your home.
The assessment of your property is based on a unit called a mill, which is equal to one-thousandth of a dollar.
Assessors find annual property tax liability by multiplying the following values:
The state tax rate
The assessment ratio (this is the portion of the property value that’s subject to tax)
The property value
Keep in mind that all three values will fluctuate as a result of both the market and state.
The state you’re in will affect your property assessment.
Some states conduct their assessments annually while others do it every few years.
Which States Have the Lowest Property Taxes (2023)?
Note: data is from WalletHub.
1. Hawaii
Property Tax Rate: 0.28 percent
While Hawaii has the lowest property tax rate of any state in the nation, this shouldn’t fool you.
The median annual tax payment is still $1,715.
This is significant, and it can be attributed to the fact that the median home value is the highest in the U.S. at $615,300.
2. Alabama
Property Tax Rate: 0.41 percent
If you’re looking to have a low annual housing payment, Alabama is a good option.
The average Alabama homeowner will pay just $587 per year in property taxes based on the typical home value of $142,700.
These taxes go toward local government, public services, and education.
3. Colorado
Property Tax Rate: 0.51 percent
Colorado has the third lowest property taxes in the United States.
It’s below the national average of 0.99 percent.
They have a low tax rate because the rates in Colorado do not apply to market value and rather to the assessed value (often just a fraction of the market value of your home).
The average home price in Colorado is $343,300, so the average annual property tax is right around $1,756.
4. Louisiana
Property Tax Rate: 0.55 percent
Louisiana has the best of both worlds.
While it has a low property tax rate, it also has home values that are on the lower side as well.
Its typical home values are priced at $163,100.
This means that the annual taxes on a home at this price are around $890.
That said, while Louisiana is much more affordable than some other states in the country, it also has a high poverty rate.
5. District of Columbia
Property Tax Rate: 0.56 percent
While you may have heard it’s very expensive to purchase property in Washington, D.C. (and you’re not wrong!), the property tax rates are very low.
The rate is so low that D.C. is in the top 5 states with the lowest property taxes.
Now, this doesn’t necessarily make it any less daunting to buy in the District.
The median home value in D.C. exceeds half a million dollars.
However, D.C. does offer homeowners several ways to maximize deductions and credits to reduce their overall bill.
6. South Carolina
Property Tax Rate: 0.57 percent
While both South Caroline and Delaware are neck and neck when it comes to the tax rate, South Carolina has a higher typical home value.
People really do have Carolina in their minds these days.
That said, South Carolina still battles to keep their poverty rate down like many other southern states.
7. Delaware
Property Tax Rate: 0.57 percent
Delaware is another state tucked away in the mid-Atlantic region (like D.C.).
Homeowners in this state are more likely to pay more for a typical home because the average values are higher.
This can hike up your property tax bill.
In 2022, the typical home value is $251,100, which can put your annual taxes at right around $1,431.
However, because the median household income is higher, this is possible for many residents.
Plus, there’s no sales tax in the state, which is an added bonus!
8. West Virginia
Property Tax Rate: 0.58 percent
If you’re looking to minimize your housing costs, West Virginia is a great bet to make.
It has a low property tax rate as well as modest home prices.
The typical home value in 2022 was $119,600.
When you do the math on how much you end up paying in property tax, you’re looking at roughly $698. Not bad!
9. Nevada
Property Tax Rate: 0.60 percent
Generally, we’ve been working with “effective property tax rates” which compare rates at the state level.
However, property tax rates can still vary within a state.
Depending on where you live in Nevada, the rate may be anywhere from a negligible amount to the equivalent of your mortgage.
Keep that in mind when shopping around!
10. Wyoming
Property Tax Rate: 0.61 percent
Wyoming is an attractive state for tax reasons.
The state’s sales tax is among the lowest in the country, and it has no state income tax whatsoever.
So, if you add in the fact that the property tax rate is in the top 10 lowest in the U.S., then it has a lot going for it.
The typical home value isn’t all that low at around $220,500 on average, but it isn’t that high if you look at some of the most expensive states (looking at you, Hawaii!).
11. Arkansas
Property Tax Rate: 0.62 percent
Despite having a slightly higher tax rate, Arkansas is similar to other southern states.
It has a low property tax rate and cost of living.
This means you can move to the state, take advantage of the typical home value of $127,800 and pay around $798 on property taxes each year.
A pretty good deal!
12. Utah
Property Tax Rate: 0.63 percent
The state of Utah has worked hard to reduce payments for its residents.
In the 1990s, the Utah State Legislature reduced the statewide basic levy for education twice.
It also allowed counties to impose a sales tax if they reduced property taxes.
As a result, primary residences in Utah receive a 45 percent exemption on property taxes.
That said, Utah does have higher typical home values, which can result in higher taxes — that exemption really does people favors!
13. Arizona
Property Tax Rate: 0.66 percent
Arizona has a law that caps the total tax rate on owner-occupied homes.
While the overall effective tax rate is among the lowest in the nation, you should pay attention to where you’re purchasing a home.
For instance, Pima County collects the highest property tax in Arizona (0.81 percent) while Greenlee County has the lowest at 0.46 percent.
14. Idaho
Property Tax Rate: 0.69 percent
The typical homeowner in Idaho will pay around $1,456 in property taxes annually.
This is roughly $1,000 less than the national average.
The state has a homeowner’s exemption that will allow them to keep property taxes low.
This states that they will exempt 50 percent of the value of your home and up to one acre of land (maximum $100,000).
15. Tennessee
Property Tax Rate: 0.71 percent
Property taxes are low in Tennessee because they aren’t applied to the full market value of the property.
Rather, they’re just applied to the assessed value which is equal to 25 percent of the market value for residential property.
This can help homeowners pay around half of the national average in taxes annually.
What Are State Property Tax Exemptions?
An exemption is an elimination of all or part of the property taxes for an eligible piece of real estate.
In some areas, real estate can only become tax-exempt after the property owner has been approved.
To be eligible for exemption, the property may need to meet criteria like the owner must be a qualifying person or entity, OR it may need to be used for public, educational, religious, or charitable purposes.
Qualifying individuals often include senior citizens, STAR (School Tax Relief) participants, disabled individuals, and veterans.
Common tax-exempt properties include churches or other places of worship; institutions of public charity; properties used for public purposes (ex: public hospitals, schools, burial grounds); certain types of personal property like those that create energy, enable commerce, or conserve nature; qualifying wetlands or native prairie lands; etc. this is not an exhaustive list.
If you’re interested in having your real estate considered for tax exemption, make sure you check to see if your area requires an application.
You don’t want to miss the deadline for filing your application.
How Do You Reduce Your Payments?
If you want to pay the lowest property taxes possible, consider the following tips!
Understand your tax bill. This is the first step to recognizing how you could change your situation if you feel your taxes are too high.
Ask for your property tax card. You can go to the town hall and request a copy of your property tax card from the local assessor’s office.
This card has information that the town has gathered about the property over time.
Make sure to review the card and see if there are any mistakes or discrepancies. They are more common than you think!
Don’t build on your land. Any structural changes to your home or property will increase your bill.
For instance, if you add a deck, pool, large shed, or any other permanent fixture, the state will assume your home has increased its value.
Limit curb appeal. Tax assessors have a strict set of guidelines when it comes to the evaluation process.
The assessment contains some subjectivity, and more attractive homes are often assessed at a higher value.
Review comparable homes in your area. You can find discrepancies that can lower your taxes when you appeal to an assessor.
Walk the home with an assessor. Don’t allow your assessor to walk unguided.
Most of them will only see the shiny, new selling points of a home.
They won’t look at your old, outdated, or broken components.
Walk your home and point out your deficiencies.
It may feel weird to do this, but it can save you money!
Allow the assessor to access your home. While you don’t have to allow the assessor inside, they’ll assume the greatest value if they don’t see the inside.
By letting them see inside, you can reduce your bill.
Look for exemptions. Make sure you check whether your state lowers the tax burden for you.
You just have to fall into certain categories!
Appeal your tax bill. If you still don’t think your tax bill is fair, you can appeal your bill.
It will likely require you to go through a lawyer and pay at least a small fee.
This isn’t worth it for everyone, but it can be if you think your tax bill is truly unfair.
Keep in mind that it could take several months for a decision, so this probably isn’t the move if you’re trying to avoid paying taxes for the upcoming season.
Final Thoughts
Did you know that property taxes are sometimes seen as the “lifeblood” of the local government?
They can account for over 70 percent of all local tax revenue.
While paying into local services — schools, parks, roads, and other public works — can be fruitful, sometimes it doesn’t make sense to pay more than necessary.
Searching for the places with the lowest property taxes can help put money back in your pocket at the end of the year.
Additional Resources
If you are looking to buy affordable land, you can check out our Listings page.
And before you buy land, make sure you check out Gokce Land Due Diligence Program. 
Don't forget to check out my latest Gokce Knowledge Class: 31 Lessons I Learned Selling My First 500 Properties Online. 
If you are looking to sell land, visit our page on how to Sell Your Land.
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Disclaimer: we are not lawyers, accountants or financial advisors and the information in this article is for informational purposes only. This article is based on our own research and experience and we do our best to keep it accurate and up-to-date, but it may contain errors. Please be sure to consult a legal or financial professional before making any investment decisions.
Prior to starting Gokce Capital, Erika received a Bachelor of Architecture from the University of Southern California and a graduate degree in Urban Policy from Columbia University. She worked as both an architectural designer and engineer in New York before joining the New York City Department of Housing Preservation and Development.
Erika currently lives in the New York Metropolitan area with her spouse, daughter and cat. She is originally from Chicago and still considers herself a midwesterner at heart.
Erika also loves to read, write and travel (fun fact, she has visited all 50 states and more than 30 countries!). Her new book, Land Investing Mistakes: 11 True Stories You Need To Know Before Buying Land, is now available on Amazon.