Property taxes remain one of the most uneven costs facing US households, with geography playing an outsized role in how much homeowners and even renters ultimately pay.
The typical American household shells out $3,119 annually in property taxes, according to US Census Bureau data. In the 26 states that also impose taxes on vehicles, residents pay an average of $499 more each year, further widening the financial gap between low- and high-tax jurisdictions.
The analysis of data by WalletHub also shows that property taxes are baked into rental pricing and form a core funding source for state and local governments, meaning most Americans feel the effects one way or another.
New Jersey ranks as the most expensive state, with an effective property tax rate of 2.11%, translating to $7,022 annually on a home valued at $332,700 (the US median as of 2024) and $9,590 on a home at the state’s median value of $454,400.
Illinois follows closely at 2.01%, with Connecticut (1.81%) and New Hampshire (1.66%) also among the costliest states for homeowners.
By contrast, Hawaii claims the lowest effective tax rate at just 0.27%. A homeowner there would pay $888 on a $332,700 property, despite the state’s far higher median home value of $839,100. Alabama (0.38%) and Nevada (0.47%) also rank among the least burdensome states.
The disparity underscores how headline home prices don’t always align with annual tax bills.
“Some states charge no property taxes at all, while others charge an arm and a leg,” said Chip Lupo, WalletHub Analyst. “Americans who are considering moving and want to maximize the amount of money they take home should take into account property tax rates, in addition to other financial factors like the overall cost of living, when deciding on a city.”
But real estate isn’t the only variable.
More than half the states impose no recurring vehicle property tax at all including Hawaii, Florida, Texas, New York and Illinois which have a 0.00% effective vehicle tax rate, meaning no annual levy on a $29,100 Toyota Camry LE, the top-selling car of 2025 used as the benchmark in the study.
But in states that do assess vehicle taxes, the costs can climb quickly. Virginia tops the list with a 3.97% effective rate, equating to $1,156 per year on the same vehicle. Mississippi (3.42%) and Missouri (2.55%) also rank near the top.
Louisiana, by comparison, posts a modest 0.10% vehicle tax rate, or just $29 annually.
Notably, Georgia eliminated its recurring vehicle property tax in 2013, replacing it with a one-time levy based on fair market value.
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