How much are property taxes rising?

Property Taxes are rising
@Tereza via Twenty20

U.S. homeowners in 2020 paid an average $3,719 in property taxes, Attom's data found. That represents a fairly substantial increase of 4.4% from a year earlier, when the average was $3,561.

“The increase was twice what it was in 2019," Tata says.

More than half the metropolitan areas analyzed in Attom's study saw their average property taxes rise faster than the national average. Some were more than double:

  • Salt Lake City — 11.4%
  • San Francisco — 11.1%
  • San Jose, California — 10.8%
  • Seattle — 10.3%
  • Atlanta — 10.2%
  • San Diego — 10.2%
  • Tampa, Florida — 10%
  • Denver — 9.9%
  • Raleigh, North Carolina — 9.7%
  • Columbus, Ohio — 9.1%

Homeowners in New Jersey had the highest property tax bills. They paid an average $9,196 last year.

Connecticut ($7,395), New York ($6,628), New Hampshire ($6,596) and Massachusetts ($6,514) rounded out the top five. The takeaway? It’s not cheap to own a home in the Northeast.

The states with the smallest average property tax bills last year were Alabama ($841), West Virginia ($849), Arkansas ($1,147), Tennessee ($1,202) and Mississippi ($1,241).

Simply add Capital One Shopping to your browser, and shop like normal. This free tool does the work for you.

Install Capital One Shopping

Why property taxes are so much higher

State revenue building
Konstantin L / Shutterstock

The rising costs of public services Tata refers to are being fueled in no small part by the COVID-19 pandemic. Perhaps you’ve heard of it?

To cover their operating costs, communities rely heavily on taxes paid by businesses. As business revenue falls, so do local government coffers. The pandemic forced some 200,000 U.S. businesses to permanently shut down during the first year of the pandemic, according to a recent Federal Reserve study.

Meanwhile, local government costs — including to run public hospitals and clean public schools — jumped last year because of COVID.

With revenues vaporizing and expenses rising, communities and school districts have had no choice but to find ways to make up the difference. Raising property taxes, as much as it stinks for homeowners, is a relatively simple and effective solution.

If you’re feeling the pinch

Worried couple checking receipt sitting in the sofa in the living room at home
Antonio Guillem / Shutterstock

If you, like so many Americans, are dealing with ongoing financial uncertainty due to the pandemic, higher property taxes are going to hurt all the more. But there are steps you can take to get your finances on firmer footing.

One way of potentially saving a substantial stack of cash is by refinancing your mortgage. Mortgage technology firm Black Knight calculates that around 13 million homeowners in the U.S. could save an average of $283 a month by refinancing, now that 30-year mortgage rates are averaging under 3% again.

Easing the burden of credit card debt also can help counter the impact of higher property taxes. Consider taking out a debt consolidation loan, which can help you pay off your credit card debt more quickly.

Higher property taxes or not, it’s always a good time to see if you can reduce the cost of your homeowners insurance. Compare providers when your policy comes up for renewal, because you may be able to score yourself a better deal.

As you're pinching pennies, you may not think you’re in a position to play the stock market. But there’s a way to merely invest your "spare change" into a diversified portfolio that pays real returns.

COVID's economic impact is far from over, so your local government's situation could turn even uglier. You and your fellow taxpayers may be asked to pay even more. Best to start preparing a little extra cushion now.

Compare car insurance and save up to $500 a year

If you haven't compared car insurance recently, you're probably paying too much for your policy. Getting quotes from multiple insurers used to be time-consuming, but today's technology makes it easy.

Using a free site like Pretected is easy and could help you save up to $500 a year on car insurance. In mintues, their "smart matching" system will provide tailor-made quotes from insurers that can meet all of your coverage needs - and your budget.

Stay protected on the road and find more affordable car insurance in minutes with Pretected.

About the Author

Clayton Jarvis

Clayton Jarvis

Reporter

Clayton Jarvis is a mortgage reporter at MoneyWise. Prior to joining the MoneyWise team, Clay wrote for and edited a variety of real estate publications, including Canadian Real Estate Wealth, Real Estate Professional, Mortgage Broker News, Canadian Mortgage Professional, and Mortgage Professional America.

What to Read Next

Disclaimer

The content provided on MoneyWise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter.