Who Has the Highest Property Taxes in 2026?

If you own a home, you’ve probably seen your property tax bill go up - again. But how does your bill stack up against others? Some places charge so much in property taxes that it eats up a big chunk of your monthly budget. Others? You could live there for decades and barely notice the cost. So who actually pays the most?

New Jersey Leads the U.S. in Property Tax Burden

In 2026, New Jersey still holds the title for the highest average property taxes in the United States. Homeowners there pay an average of $8,767 per year on a home valued at $450,000. That’s nearly 2% of the home’s value - more than double the national average. Why? It’s not just high rates. It’s also high home values and a heavy reliance on property taxes to fund public schools and local services. Unlike states that use sales or income taxes more heavily, New Jersey leans almost entirely on property owners to cover the cost of education and infrastructure.

Take a town like Hoboken. A modest 2-bedroom condo there can easily carry a $12,000 annual tax bill. For many middle-income families, that’s more than their car payment, their phone bill, and their gym membership combined. And there’s little room to appeal - assessments are frequent, and exemptions are rare.

Illinois and Connecticut Close Behind

Illinois comes in second, with an average annual property tax of $5,579. Cook County, which includes Chicago, is the worst offender. A $300,000 home there can cost $7,000+ in taxes each year. The state’s pension debt crisis forced local governments to hike property taxes to cover shortfalls. Many residents have moved out of the city into neighboring states just to escape the burden.

Connecticut isn’t far behind. With a statewide average of $5,486, it’s the most expensive state in New England. Towns like Greenwich and Darien have some of the highest tax rates per $1,000 of home value in the country - over $25 per $1,000. That means a $600,000 home pays $15,000 a year in property taxes. For retirees on fixed incomes, it’s unsustainable.

Why Some States Pay Almost Nothing

While New Jersey and Illinois bleed homeowners dry, other states barely ask for anything. Hawaii has the lowest average property tax in the U.S. at $1,726 per year. That’s because land is expensive, but tax rates are capped by law. Texas has no state income tax, so it relies on property taxes - but even there, the average is only $3,648. The key difference? Texas lets local governments set their own rates, and many rural areas keep them low.

Alabama, Louisiana, and West Virginia all average under $1,000 per year. In parts of Alabama, you can own a 3-bedroom house on a full acre and pay less than $500 in taxes annually. These states make up for low property taxes with higher sales taxes or fees - but for homeowners, it’s a trade-off that often works in their favor.

It’s Not Just About the Rate - It’s About Value and Policy

Don’t assume a high tax rate means high taxes. A state with a 1.5% tax rate but average home values of $800,000 will collect far more than a state with a 2.5% rate but homes worth $200,000. That’s why New Jersey wins - high values + high rates + no income tax = perfect storm.

Some states, like California, have protections like Proposition 13 that limit how much taxes can rise each year, even if home values spike. That means long-time owners pay far less than newcomers. In Florida, the homestead exemption knocks off the first $50,000 of value from taxation. These policies create huge disparities - two identical houses next to each other can have wildly different tax bills based on when they were bought.

International Comparison: Where Else Is It High?

Outside the U.S., property taxes are often lower - but not always. In the United Kingdom, council tax (the local equivalent) is based on property bands from the 1991 valuation. A Band H home in London might pay £3,000 a year, but that’s still less than what a similar-sized home pays in New Jersey. The U.K. doesn’t have a direct property tax on market value, so it doesn’t rise with inflation the same way.

Canada has higher taxes than the U.S. average in cities like Toronto and Vancouver, where combined municipal and school taxes can hit $6,000-$8,000 per year on a $1 million home. But again, that’s still below New Jersey’s top rates. Japan and Germany have relatively low property taxes - often under 1% of assessed value - but they make up for it with steep capital gains taxes when you sell.

Who Gets the Money? And Why Does It Matter?

Property taxes mostly fund public schools. In New Jersey, 70% of local property tax revenue goes to education. In Illinois, it’s about 60%. That’s why school districts fight so hard to keep taxes high - they depend on it. But when property values drop, or when families can’t pay, schools suffer too.

Some states, like New Hampshire, don’t have a state income tax, so property taxes cover everything: schools, police, roads, libraries. That’s why residents there are used to high bills - they know where the money goes. In contrast, states like Nevada have no property tax on primary homes at all, but they make up for it with high sales taxes and casino revenue.

What Can You Do If Your Taxes Are Too High?

If you’re paying more than you think you should, you’re not powerless. Most counties allow you to appeal your assessment. You’ll need recent sales data from similar homes in your neighborhood. If your home was assessed at $400,000 but three similar homes sold for $320,000 last year, you have a case.

Many states offer homestead exemptions, senior freezes, or disability relief. In Texas, homeowners over 65 can freeze their tax amount - it won’t rise even if the home’s value does. In New York, the STAR program cuts taxes for primary residents. You have to apply - it doesn’t happen automatically.

And if you’re thinking of moving? Look beyond the tax rate. Check the total cost: insurance, utilities, school quality, commute times. A $2,000 lower tax bill might mean a 45-minute drive to work and underfunded schools. That’s not always a win.

What’s Changing in 2026?

Several states are rethinking how they fund schools and services. California is testing a new property tax reset for inherited homes. New Jersey is exploring a state-level property tax rebate program. Florida is expanding its homestead exemption. Meanwhile, inflation is pushing home values up - which means more tax bills, even if rates stay the same.

Don’t expect relief soon in the highest-tax states. Political will to cut property taxes is weak when so much public funding depends on it. But awareness is growing. More homeowners are organizing to demand transparency - and more accountability.