Property taxes are due again. (Doesn't it seem like we just paid these?) Around this time each year I dream of moving somewhere with lower property taxes but how could I leave California? It would be tough. I just found out that the state with the lowest property taxes is also a place that equals paradise in my mind - Hawaii!
According to research done by 24/7Wall Street, Hawaii ranks 50th out of the states in property taxes.
Hawaii
- Effective property tax rate: 0.28%
- Median home value: $528,000 (the highest)
- Property taxes paid per tax return: $1,993 (5th lowest)
This is great news for me. I see a house hunting trip in my near future. (A girl can dream!)
Coming in at 49th and 48th were Alabama and Louisiana.
The state with the highest property tax. Can you guess? It isn't California. It is New Jersey. Who knew?
New Jersey
- Effective property tax rate: 2.38%
- Median home value: $313,200 (4th highest)
- Property taxes paid per tax return: $8,943 (the highest)
It is followed by New Hampshire (2.15%), Connecticut (1.98%) and Wisconsin (1.96%).
Here is how California stacks up.
Effective property tax rate: 0.81%
Median home value: $412,700 (2nd highest)
Property taxes paid per tax return: $5,219 (9th highest)
County paying the most in real estate taxes: Marin County
Property taxes paid per tax return in Marin County: $9,283
California doesn't look too bad thanks to Prop 13 which was passed in 1978. Under Proposition 13, property tax value was rolled back and frozen at the 1976 assessed value level. Property tax increases were then limited to no more than 2 percent per year as long as the property was not sold. Once sold, the property tax was reassessed at 1 percent of the sale price, and the 2 percent yearly cap became applicable to future years. This allowed property owners to be able to estimate the amount of future property taxes, and determine the maximum amount taxes could increase as long as they owned the property.
A little history lesson for today. You still have to write the check but maybe this helps.
