If low property tax is high on your list for a move, five states stand out. Hawaii, Alabama, Nevada, Arizona and Colorado all have typical effective rates below half of one percent, about half the national figure of 0.94%. But a low rate is only one part of what a home costs to own, and each of these states makes up the money somewhere else.
Hawaii: lowest rate, highest prices
Hawaii’s typical effective rate is about 0.27%, the lowest in the country. The typical owner pays $2,239 a year, which sounds modest until you see the home value behind it: $839,100, the highest median of any state. Honolulu County’s rate is about 0.28%, and the Big Island’s is similar.
The catch is the price of the house and everything else. Hawaii’s state income tax tops out above 11%, and its general excise tax applies to almost every purchase. A low property tax bill on an expensive home is still a large share of a household budget once the mortgage is included.
Alabama: low rate and low bills
Alabama is the one state where both the rate and the bill are truly low. The typical effective rate is about 0.38%, and the typical bill is just $788 a year on a home worth $209,900. Baldwin County, on the Gulf Coast, has one of the lowest rates of any large county in the country at about 0.30%. Tuscaloosa and Madison counties are also near the bottom nationally.
The catch is that Alabama leans on other taxes. Combined state and local sales tax rates are among the highest in the country, often 9% or more, and groceries are taxed. Local services funded by property tax, including schools, receive less money than in most states.
Nevada and Arizona: desert states, low rates
Nevada’s typical rate is about 0.47%, with a typical bill of $2,027 on a home worth $435,400. Nevada has no state income tax, and its budget relies heavily on sales and gaming taxes. Both states also cap how fast a homeowner’s tax can rise each year.
Arizona’s rate is about 0.48%, and the typical bill is $1,879. In Maricopa County, which includes Phoenix, the typical rate is about 0.44%, one of the lowest of any big metro county. Arizona has a flat 2.5% income tax. The catch in both states is mostly price: home values climbed sharply in the last decade, and HOA dues in newer subdivisions can add more each year than the property tax itself.
Colorado: low rate, rising values
Colorado’s typical rate is about 0.48%, but because the median home is worth $539,400, the typical bill is $2,602, not far below the national median. Denver County’s rate is about 0.45%. Colorado’s constitution limits how much local governments can raise, which keeps rates low, but values have climbed so quickly that bills have jumped, and the state has passed several rounds of temporary relief.
Lowest rate is not lowest cost
If you are comparing places, look at three numbers together: the typical bill on the home you plan to buy, the state income tax on your expected income, and the sales tax you will pay on day-to-day spending. A state with a 0.4% property tax and a 9% sales tax may cost a retiree more than a state with a 1% property tax and no tax on groceries. Our state pages show the income and sales tax facts next to the property tax figures for exactly this reason.
Common questions
Which state has the lowest property tax overall? Hawaii has the lowest rate, about 0.27%. Alabama has the lowest typical bill, under $800 a year.
Which big city has the lowest property tax? Among large counties, Honolulu, Maricopa (Phoenix) and Denver all have typical rates below 0.5%.
Are low property tax states cheaper to live in? Not always. Home prices, income tax and sales tax can outweigh a low property tax bill.
Do these states offer extra breaks for seniors? Most do, through homestead exemptions, freezes or deferrals. Check the state page for details.
Figures from the US Census Bureau American Community Survey, 2020-2024. How we calculate them.
