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Best Places To Own a Home — and Save On Taxes

Cynthia Measom

Taxes are a fact of life in the U.S., but depending on where you settle down, the tax burden for homebuyers might be much heavier — and it’s an expense that can really take a toll on your budget.

The U.S. median home value is $226,800 in 2019, with an average effective property tax rate of 1% and a median real estate tax bill of $2,279. To determine the 30 best places to own a home if you want to pay fewer taxes, GOBankingRates analyzed median home values, state and local income tax rates, sales and use tax rates, median real estate taxes paid, and effective property tax rates in over 200 cities.

Find out if relocating might be the best solution for easing your tax burden, or if you’re already living in a prime location to save money on real estate taxes.

30. Spokane, Washington

  • April 2019 median home value: $212,400
  • State income tax rate: 0%
  • Sales and use tax rate: 8.9%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,923
  • Effective property tax rate: 0.9%

Spokane has some of the highest sales and use tax rates and property tax rates out of all of the cities on GOBankingRates’ list, which is probably why it landed lower in the overall ranking. Even so, it’s considered one of the best places to own a home and save on taxes.

29. Ocala, Florida

  • April 2019 median home value: $145,300
  • State income tax rate: 0%
  • Sales and use tax rate: 7%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,039
  • Effective property tax rate: 0.71%

Out of all the Florida cities on GOBankingRates’ list that ranked in the top 30, Ocala has the lowest median home value and the smallest five-year change in home value. But you’ll pay more in property taxes compared to other cities in Florida, such as Lakeland, St. Petersburg, Hialeah and Kissimmee.

28. Aurora, Colorado

  • April 2019 median home value: $327,000
  • State income tax rate: 4.63%
  • Sales and use tax rate: 8%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,335
  • Effective property tax rate: 0.4%

Aurora carries a state income tax rate, unlike the majority of cities in GOBankingRates’ ranking, and its median home value falls among the 10 most expensive on the list. Median real estate taxes paid in Aurora, however, are some of the lowest in the country.

27. Irving, Texas

  • April 2019 median home value: $222,200
  • State income tax rate: 0%
  • Sales and use tax rate: 8.25%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $3,088
  • Effective property tax rate: 1.39%

Irving has an effective property tax rate and real estate taxes that are higher than the national average. It also has the highest median home value compared to the other Texas cities in this ranking — Dallas and Garland — but it’s still below the national average.

26. Jacksonville, Florida

  • April 2019 median home value: $177,500
  • State income tax rate: 0%
  • Sales and use tax rate: 7%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,466
  • Effective property tax rate: 0.83%

Jacksonville has the second-highest property tax rate out of all the Florida cities that ranked in the top 30, but it’s still below the national average of 1%. Additionally, the city’s median real estate taxes paid and sales and use tax are both below the national average.

25. Boston

  • April 2019 median home value: $599,000
  • State income tax rate: 5.05%
  • Sales and use tax rate: 6.25%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,172
  • Effective property tax rate: 0.20%

Boston has one of the highest median home values on GOBankingRates’ list, with an increase of $188,700 in value over five years. The city also has one of the highest state income tax rates. However, Boston boasts the lowest property tax rate, which is far below the national average of 1%.

24. Vancouver, Washington

  • April 2019 median home value: $321,200
  • State income tax rate: 0%
  • Sales and use tax rate: 8.4%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $2,579
  • Effective property tax rate: 0.8%

Vancouver ranks in the top 10 for highest median home values, with a five-year change in value totaling nearly $122,000. The city has real estate taxes that are more expensive compared to the rest of the country, but it also has a property tax rate that’s below the national average.

23. Garland, Texas

  • April 2019 median home value: $204,100
  • State income tax rate: 0%
  • Sales and use tax rate: 8.25%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $2,666
  • Effective property tax rate: 1.3%

Out of all the Texas cities that ranked in the top 30, Garland has the lowest median home value, median real estate taxes and property tax rate. However, the property tax rate and median real estate taxes in Garland are above the national average.

22. Lakeland, Florida

  • April 2019 median home value: $161,600
  • State income tax rate: 0%
  • Sales and use tax rate: 7%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,076
  • Effective property tax rate: 0.67%

Lakeland has the second-lowest real estate taxes out of all the Florida cities that made GOBankingRates’ list. Plus, the property tax rate and median real estate taxes are both well below the national average.

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21. Kissimmee, Florida

  • April 2019 median home value: $217,400
  • State income tax rate: 0%
  • Sales and use tax rate: 7.5%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,145
  • Effective property tax rate: 0.53%

In Kissimmee, the effective property tax rate and median real estate taxes are both below the national average. Compared to the other Florida cities that ranked among the top 30 places to own a home and save on taxes, Kissimmee’s median home value falls toward the middle of the pack.

20. Pensacola, Florida

  • April 2019 median home value: $145,800
  • State income tax rate: 0%
  • Sales and use tax rate: 7.5%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,160
  • Effective property tax rate: 0.80%

The median real estate taxes and property tax rate in Pensacola are below the national average. Compared to people in Kissimmee, Florida, people in Pensacola have to pay higher taxes in these areas, but at least the median home value in this city is much lower.

19. Port St. Lucie, Florida

  • April 2019 median home value: $222,500
  • State income tax rate: 0%
  • Sales and use tax rate: 7%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $2,161
  • Effective property tax rate: 0.97%

The median real estate taxes in Port St. Lucie are much higher compared to the other Florida cities that made GOBankingRates’ list. However, there aren’t state and local income taxes in Florida. And, Port St. Lucie’s median home value is slightly lower than the national average of $226,800.

18. Boise, Idaho

  • April 2019 median home value: $299,300
  • State income tax rate: 6.93%
  • Sales and use tax rate: 6%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,706
  • Effective property tax rate: 0.57%

Boise’s median home value is higher than the national average by over $70,000. However, the city’s state income tax rate, median real estate taxes and property tax rate are all below the national average.

17. San Jose, California

  • April 2019 median home value: $1,039,700
  • State income tax rate: 9.3%
  • Sales and use tax rate: 9.25%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $5,788
  • Effective property tax rate: 0.56%

San Jose has the third-highest median home value on GOBankingRates’ list, with a five-year increase of $358,600, which is almost six times the national average of $60,300. The median real estate taxes in San Jose are far higher than the national average, but at least the property tax rate is also much lower.

16. Orlando, Florida

  • April 2019 median home value: $241,200
  • State income tax rate: 0%
  • Sales and use tax rate: 6.5%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,846
  • Effective property tax rate: 0.77%

Orlando has fairly high median real estate taxes at $1,846, though it is still below the national average of $2,279. However, its median home value, median real estate taxes and property tax rate are all below the national average.

15. Henderson, Nevada

  • April 2019 median home value: $329,800
  • State income tax rate: 0%
  • Sales and use tax rate: 8.25%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,846
  • Effective property tax rate: 0.56%

Compared to all the cities in Nevada that made GOBankingRates’ list, Henderson has the highest median real estate taxes — plus, its median home value is well above the national average. However, the median real estate taxes paid and effective property tax rate in Henderson are both lower than the national average.

14. Nashville, Tennessee

  • April 2019 median home value: $263,500
  • State income tax rate: 0%
  • Sales and use tax rate: 9.25%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,250
  • Effective property tax rate: 0.47%

Nashville has one of the highest sales and use tax rates out of all of the cities in this study. Although Nashville’s median home value is higher than the national average, the city isn’t considered expensive in that category — it falls toward the middle of the list. Both the median real estate taxes paid and the property tax rate in Nashville are lower than the nation’s average.

13. Tacoma, Washington

  • April 2019 median home value: $312,200
  • State income tax rate: 0%
  • Sales and use tax rate: 10.2%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $2,849
  • Effective property tax rate: 0.91%

Tacoma has the highest sales and use tax rate compared to the other Washington cities that made the list — and it collects the highest rate in general. Tacoma also has a higher property tax rate than all the other cities in Washington. However, it’s still slightly lower than the national average.

12. San Francisco

  • April 2019 median home value: $1,357,500
  • State income tax rate: 9.3%
  • Sales and use tax rate: 8.5%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $6,019
  • Effective property tax rate: 0.44%

San Francisco claims the highest median home value on GOBankingRates’ list, and not without good reason. The city experienced the largest five-year change in median home value between 2014-19, with an increase of $441,100. It also features one of the highest state income tax rates in this study.

 

11. Seattle

  • April 2019 median home value: $723,300
  • State income tax rate: 0%
  • Sales and use tax rate: 10.1%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $4,326
  • Effective property tax rate: 0.60%

Out of all the Washington cities that made the top 30 in this study, Seattle has had the largest increase in median home value over the past five years — a $280,900 change in value — and it also has the highest median real estate taxes paid. However, the property tax rate in Seattle is lower compared to all the other cities in Washington that ranked.

10. Salt Lake City

  • April 2019 median home value: $397,600
  • State income tax rate: 4.95%
  • Sales and use tax rate: 7.75%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,912
  • Effective property tax rate: 0.48%

Out of all the states that feature a state income tax, Salt Lake City has one of the lowest rates. Although the city’s sales and use tax rate is higher than the national average, the median real estate taxes paid and the effective property tax rate are lower.

9. Dallas

  • April 2019 median home value: $214,400
  • State income tax rate: 0%
  • Sales and use tax rate: 8.25%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $2,986
  • Effective property tax rate: 1.39%

Median home values in Dallas are lower than in No. 8 Las Vegas, but the state and local income tax rates — as well as the sales and use tax rate — are exactly the same. Dallas ranks lower on GOBankingRates’ list thanks to its significantly higher median real estate taxes and property tax rate.

8. Las Vegas

  • April 2019 median home value: $275,500
  • State income tax rate: 0%
  • Sales and use tax rate: 8.25%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,529
  • Effective property tax rate: 0.56%

Las Vegas and the higher-ranking North Las Vegas are a short distance away from each other geographically and in the ranking. However, while the state and local income tax rates — and sales and use tax rate — are exactly the same for each city, the median real estate taxes and property tax rate in Las Vegas are slightly higher.

7. Reno, Nevada

  • April 2019 median home value: $370,200
  • State income tax rate: 0%
  • Sales and use tax rate: 8.27%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,668
  • Effective property tax rate: 0.45%

When you compare the taxes in Reno to the rates in North Las Vegas — a higher-ranking Nevada city — you’ll find several differences. The sales and use tax rate is slightly higher in Reno compared to North Las Vegas: 8.27% vs. 8.25%, respectively. Median real estate taxes are also a bit higher in Reno, but the effective property tax rate is lower.

6. Tampa, Florida

  • April 2019 median home value: $221,100
  • State income tax rate: 0%
  • Sales and use tax rate: 8.5%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,640
  • Effective property tax rate: 0.74%

The property tax rate and median real estate taxes paid in Tampa are below the national average. Compared to the other cities that ranked among the top 10 places to own a home and save on taxes, the median home value in Tampa is the third-lowest.

5. Jersey City, New Jersey

  • April 2019 median home value: $483,900
  • State income tax rate: 5.53%
  • Sales and use tax rate: 6.63%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $7,347
  • Effective property tax rate: 1.52%

Jersey City has one of the lowest state income tax rates when you compare all the cities located in states that assess the tax. Although its sales and use tax rate is below average for the nation, the median real estate taxes paid and property tax rate are not. In fact, Jersey City has the highest property tax rate on GOBankingRates’ list.

4. Fremont, California

  • April 2019 median home value: $1,120,700
  • State income tax rate: 9.3%
  • Sales and use tax rate: 9.25%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $5,747
  • Effective property tax rate: 0.51%

Fremont has the second-highest median home value in this study — it’s one of three cities to cross the $1 million mark. Fremont also ranks No. 2 for the greatest increase in median home value over the past five years, with a gain of $404,800.

3. North Las Vegas, Nevada

  • April 2019 median home value: $261,500
  • State income tax rate: 0%
  • Sales and use tax rate: 8.25%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,383
  • Effective property tax rate: 0.53%

North Las Vegas’ sales and use tax rate is 1.25% higher than the cities that hold the No. 1 and No. 2 spots on GOBankingRates’ list, but the median real estate taxes paid in North Las Vegas are slightly lower. The city’s property tax rate falls in between the two higher-ranking places in this study.

2. St. Petersburg, Florida

  • April 2019 median home value: $216,400
  • State income tax rate: 0%
  • Sales and use tax rate: 7%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,401
  • Effective property tax rate: 0.65%

It’s no wonder why this city ranks No. 2 in GOBankingRates’ study — St. Petersburg’s sales and use tax rate, effective property tax rate, median real estate taxes paid and median home value are all below the national average.

1. Hialeah, Florida

  • April 2019 median home value: $286,300
  • State income tax rate: 0%
  • Sales and use tax rate: 7%
  • Local income tax rate: 0%
  • Median real estate taxes paid: $1,469
  • Effective property tax rate: 0.51%

Hialeah ranks No. 1 on this list of the best places to own a home and save on taxes. The city’s sales and use tax rate is below the national average, and so are the median real estate taxes paid. Plus, Hialeah’s median home value and effective property tax rate are far from being the highest in this study.

Best Places To Own a Home and Save On Taxes

For homebuyers looking to save a bundle on their taxes, the city of Hialeah, Florida, should be a top consideration. If you already live in a state captured on this list, look for the city that has the lowest real estate taxes within your state. For example, if you already live in California, Fremont has strong tax advantages over San Jose. If you live in Nevada, North Las Vegas is the clear winner over Reno and Las Vegas.

But, before you start packing your bags, make sure to choose a city that offers home values within your budget. After all, burdening yourself with a pricey mortgage just so you can save on taxes might not be the savviest move.

Click through to see the states with the highest property taxes — so you can avoid them.

More on Saving Money

Methodology: GOBankingRates determined the best places to own a home and save on taxes by analyzing the 200 largest cities in the U.S. along the following criteria: (1) two-year change in median home value by percentage, based on data from Zillow’s April 2019 index; (2) two-year change in median home value in dollars, based on data from Zillow’s April 2019 index; (3) five-year change in median home value by percentage, based on data from Zillow’s April 2019 index; (4) five-year change in median home value in dollars, based on data from Zillow’s April 2019 index; (5) state income tax rate, sourced from individual state websites; (6) local income tax rate, sourced from individual city and county websites; (7) combined sales tax rate, sourced from individual city, county, local and state websites; (8) effective property tax rate, based on the median amount of real estate taxes paid in each city, sourced from the Census Bureau’s 2017 American Community Survey, divided by the current median home value. Each factor was scored and combined, and then the cities were ranked.

This article originally appeared on GOBankingRates.com: Best Places To Own a Home — and Save On Taxes