States With the Highest and Lowest Property Taxes

Property tax is not always something homebuyers take into account when shopping for a home, but it can dramatically impact your budget. And how much you pay ultimately comes down to where you live.

When it comes to making your monthly mortgage payment, a portion of that amount goes into property tax but this varies greatly from state to state.

Lawrence Yun, the chief economist for the National Association of Realtors, explained that in certain areas such as Buffalo and Syracuse in New York, tax rates are so high that the property tax portion of the monthly bill could be higher than the mortgage part, according to USA Today.

A previous report by CNBC noted that home buyers need to first find out what the property taxes are before making a purchase, then they need to divide it by 12 and add it to an estimated monthly instalment. When drawing up a budget, they still keep in mind that taxes increase so there needs to be room in a budget to accommodate these fluctuations.

"Property tax is a critical piece of information in the home purchase decision and something a buyer should ask about before making the purchase," Yun said, per USA Today.

Generally speaking, the effective property tax rate in the U.S. is 1.2 %, with 18 states either matching or exceeding that estimation and 32 states falling below that figure.

In light of this information, USA Today set out to determine which states had the highest and lowest property taxes according to data from the Lincoln Institute of Land Policy. These are the results:

States With Highest Property Taxes

1. New Jersey- Tax rate: 2.35%. Median home value: $315,900. Median tax paid: $7,410
2. Illinois- Tax rate- 2.3%. Median home value: $173,800. Median tax paid: $3,995
3. New Hampshire- Tax rate: 2.15%. Median home value: $237,300. Median tax paid: $5,100
4. Connecticut- Tax rate: 1.97%. Median home value: $270,500. Median tax paid: $5,327
5. Wisconsin- Tax rate: 1.96%. Median home value: $165,800. Median tax paid: $3,248
6. Texas- Tax rate: 1.9%. Median home value: $136,000. Median tax paid: $2,578
7. Nebraska- Tax rate: 1.85%. Median home value: $133,200. Median tax paid: $2,467
8. Michigan- Tax rate: 1.78%. Median home value: $122,400. Median tax paid: $2,174
9. Vermont- Tax rate: 1.74%. Median home value: $217,500. Median tax paid: $3,795
10. Rhode Island- Tax rate: 1.63%. Median home value: $238,000. Median tax paid: $3,884

Best states for Property Taxes

1. Hawaii- Tax rate: 0.27%. Median home value: $515,300. Median tax paid: $1,406
2. Alabama- Tax rate: 0.43%. Median home value: $125,500. Median tax paid: $543
3. Louisiana- Tax rate: 0.49%. Median home value: $144,100. Median tax paid: $707
4. Delaware- Tax rate: 0.54%. Median home value: $231,500. Median tax paid: $1,243
5. Washington, D.C.- Tax rate: 0.56%. Median home value: $475,800. Median tax paid: $2,665
6. South Carolina- Tax rate: 0.57%. Median home value: $139,900. Median tax paid: $798
7. West Virginia- Tax rate: 0.58%. Median home value: $103,800. Median tax paid: $607
8. Colorado- Tax rate: 0.6%. Median home value: $247,800. Median tax paid: $1,489
9. Wyoming- Tax rate: 0.61%. Median home value: $194,800. Median tax paid: $1,196
10. Arkansas- Tax rate: 0.62%. Median home value: $111,400. Median tax paid: $693

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