Property taxes across the U.S. are rising faster than inflation, with the average homeowner paying $4,427 in 2024, up 3.7% from the previous year, according to a new analysis from real estate data firm ATTOM. By comparison, the Consumer Price Index (CPI) rose 2.7% last year. Some states, including Delaware (18%) and Maryland (11.6%), saw significantly larger increases.
Why Are Property Taxes Rising?
Property taxes are typically levied by local governments to fund public services like schools, roads, and emergency services. They account for 70 cents of every dollar in local tax collections, per the Tax Foundation. While the average estimated value of single-family homes dropped 1.7% to $494,231 in 2024, taxes still increased due to rising costs for public services, according to the Tax Policy Center.
Where Taxes Are Falling
While 40 states and D.C. saw property tax increases, 10 states—mostly in the West—experienced declines. Wyoming approved a 25% cut for properties valued up to $1 million, and Montana introduced a rebate and tiered tax system, benefiting 8 in 10 homeowners.
States with the Highest and Lowest Taxes
The U.S. Census Bureau reports that New Jersey ($9,358), New Hampshire ($6,707), and Connecticut ($6,573) had the highest average property taxes in 2024, far exceeding the national average of $3,211. Meanwhile, West Virginia ($881) and Alabama ($890) paid well below the average.
Market Value vs. Assessed Value
Property taxes are determined by a home’s assessed value (set by local assessors) and the local tax rate. While the average market value of single-family homes rose 55% since 2019 to $362,210 (per Zillow), higher assessed values and increased tax rates have driven up bills.
Long-Term Implications
Experts note that property taxes often rise faster than inflation because they are tied to local government funding needs rather than consumer prices. Municipalities may increase rates to cover rising costs for schools, infrastructure, and public services, regardless of broader economic trends.