Best and Worst States for Property Taxes

Investing in real estate not only means you are responsible for paying a mortgage, but you are also responsible for paying taxes. Some states will pay more property taxes than others, some states don’t even have taxes, this is all broken down below using the Census data below, to help you determine the best location for your investment. Take a look at the list to see if your property made the best or worst list, when it comes to paying property taxes.

THE TOP 10 LIST OF THE BEST AND WORST STATES TO PAY PROPERTY TAXES MAY INFLUENCE YOUR DECISION ON THE NEXT LOCATION OF YOUR REAL ESTATE INVESTMENT.

Now, take a look at the following states and as you run the numbers ask yourself if it’s really worth your investment to pay a significant amount in property taxes, especially when other states are so much lower,.

Top 10 States with Highest Real Estate Taxes:

2013 chart of median real estate taxes
AOL

Top 10 States with Lowest Real Estate Taxes, according to 2013 American Community Survey:

bottom 10 states 2013 real estate taxes
AOL

The tax burden on homeowners is only the beginning of understanding property taxes. While some homeowners pay low amounts in real estate taxes, they’re paying higher in state income or sales taxes. Take for instance Alaska homeowners who had a median $3,008 tax bill last year, that’s a heavy bill, however those residents don’t have to pay state income taxes, adding some financial comfort to the homeowner.

Property taxes can get confusing when it comes to justifying costs, so let’s try to understand property taxes more when it comes to property taxes of a home’s value. Take for instance homeowners in the Northeast who will take on a bigger tax bill, however the total might only represent a relative fraction of the value of their home. According to National Association of Realtors, the median sales price for current homes in the Northeast was $237,200 last year, compared to $143,700 in the Midwest.

Now, look at The National Association of Home Builders list of states, which were separated into two categories — a state’s aggregate real estate taxes and its aggregate home values — creating a “statewide effective real estate tax.” This report went on, ranking the states in terms of their effective rate for property taxes. The national effective rate last year was 1.13 percent, according to the NAHB.

10 states with the highest effective real estate tax rates:

highest effective real estate taxes
AOL

10 states with lowest effective property tax rate, according to the National Association of Home Builders:

lowest effective property taxes
AOL

Results from the NAHB analysis can be found here, which also takes a look at valuable the role of property taxes play in state and local tax receipts.

Now, ask yourself again, is it really worth your investment to own property and pay higher taxes? Or would you like to own property in affordable states with lower taxes? Empowered Investor, LLC. can help, check out the featured properties we have in affordable markets throughout the United States. .

Information and facts came directly from Real Estate AOL on Oct 9th 2014.

photo credit: Eric Fischer via photopin cc