By:
Special Report
Home sales surged in the United States in the early months of the pandemic. From the first quarter of 2020 to the second, the homeownership rate in the U.S. climbed from 65.3% to 67.9% – the largest quarterly increase since record keeping began in the mid 1960s. And while owning a home offers several advantages over renting, it also comes with added expenses – not the least of which are property taxes.
Property taxes, specifically those on land and residential structures, are typically levied at the local level – by cities, counties, or school districts. State governments also often impose additional taxes on personal property such as cars or boats.
Typically used for funding public services such as schools, law enforcement, and infrastructure improvements, property taxes are the lifeblood of local communities across the United States. Nationwide, property taxes accounted for 32.2% of all state and local tax revenue in fiscal 2020, more than any other tax, including sales and income taxes. Depending on the state, property taxes account for anywhere from 16.8% to 64.0% of tax revenue. (Here is a look at the counties where families need to budget the most for taxes in every state.)
Exactly how much Americans pay each year in property taxes depends both on their local property tax rate and the value of their property. For example, if a single family home is valued at $200,000 in a given year and the local property tax rate is 1%, the property tax bill would come to $2,000.
With a median home value of $336,300 in 2021, Arizona has the 15th most expensive housing market in the country, based on data from the U.S. Census Bureau’s American Community Survey. And according to the Tax Foundation, an independent nonprofit tax policy research organization, the effective property tax rate in Arizona was 0.63% in 2021, the 11th lowest among the 50 states.
Meanwhile, per capita state and local property tax collections in Arizona totaled $1,206 in fiscal 2020, compared to $1,810 across the entire country.
All tax data in this story was compiled by the Tax Foundation.
Rank
State
Effective property tax rate, 2021 (%)
Per capita state & local prop. tax collections, FY2020 ($)
Median home value, 2021 ($)
1
New Jersey
2.23
3,431
389,800
2
Illinois
2.08
2,268
231,500
3
New Hampshire
1.93
3,285
345,200
4
Vermont
1.83
2,860
271,500
5
Connecticut
1.79
3,295
311,500
6
Texas
1.68
2,216
237,400
7
Nebraska
1.63
2,088
204,900
8
Wisconsin
1.61
1,717
230,700
9
Ohio
1.59
1,458
180,200
10
Iowa
1.52
1,806
174,400
11
Pennsylvania
1.49
1,644
222,300
12
New York
1.40
3,118
368,800
13
Rhode Island
1.40
2,449
348,100
14
Michigan
1.38
1,594
199,100
15
Kansas
1.34
1,712
183,800
16
Maine
1.24
2,862
252,100
17
South Dakota
1.17
1,606
219,900
18
Massachusetts
1.14
2,638
480,600
19
Minnesota
1.11
1,776
285,400
20
Maryland
1.05
1,744
370,800
21
Alaska
1.04
2,276
304,900
22
Missouri
1.01
1,114
198,300
23
North Dakota
0.98
1,538
224,400
24
Oregon
0.93
1,730
422,700
25
Georgia
0.92
1,336
249,700
26
Florida
0.91
1,541
290,700
27
Oklahoma
0.89
883
168,500
28
Virginia
0.87
1,830
330,600
29
Washington
0.87
1,727
485,700
30
Indiana
0.84
1,146
182,400
31
Kentucky
0.83
33
173,300
32
North Carolina
0.82
1,082
236,900
33
California
0.75
1,955
648,100
34
Montana
0.74
1,806
322,800
35
New Mexico
0.67
899
214,000
36
Mississippi
0.67
1,167
145,600
37
Tennessee
0.67
845
235,200
38
Idaho
0.67
1,131
369,300
39
Arkansas
0.64
798
162,300
40
Arizona
0.63
1,206
336,300
41
Delaware
0.61
1,049
300,500
42
Nevada
0.59
1,153
373,000
43
Utah
0.57
1,209
421,700
44
West Virginia
0.57
1,002
143,200
45
South Carolina
0.57
1,314
213,500
46
Louisiana
0.56
914
192,800
47
Wyoming
0.56
2,163
266,400
48
Colorado
0.55
1,956
466,200
49
Alabama
0.40
632
172,800
50
Hawaii
0.32
1,556
722,500
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See the full article on Personal Consumption Expenditures, or, read more Arizona real estate investing news. It’s your call!
