According to the old cliche, everything is bigger in Texas. This includes cowboy hats, hairstyles and… property taxes? If a recent study has anything to say about it, then yes–Texas has bigger property taxes than many other states.
According to a new report, Texas has some of the highest property taxes in the entire country. The personal finance site WalletHub examined the average property tax rates and annual payments in all 50 states. Then, it compared the data to determine the states with the highest and lowest average property taxes. Even if you believe that everything is bigger in Texas, the findings might surprise you.
Texas tends to be politically conservative, generally supporting lower taxes for private individuals and corporations. Traditionally, Texans have never looked fondly on high taxes. Nonetheless, there is no denying that the real estate market in Texas is booming, leading to higher property values and higher property taxes. The Lone Star State ranked sixth highest on WalletHub’s list with an effective real-estate tax rate of 1.86 percent. For a home worth $185,000, that means property taxes of $3,435. Compare that to the much-lower national average of $2,197.
Ranking real estate taxes
There were only five states that ranked higher than Texas on the list. The number-one most expensive state for property taxes was New Jersey, with a real-estate tax rate of 2.4 percent and an annual payment of $4,437. Rounding out the top ten are:
1. New Jersey
3. New Hampshire
10. Rhode Island
The implications for buyers and sellers
This new data about property taxes could have significant implications for anyone who is trying to buy or sell real estate in Texas. Buyers, particularly out-of-state buyers, may be deterred by the high property tax rates. As a consequence, sellers may find it more difficult to unload their properties. However, Texas real estate, particularly in metropolitan areas like Austin, Dallas and Houston, shows no sign of slowing down– many people are keen to live in the Lone Star State, regardless of property taxes.