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See how low property taxes in Utah are

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January 14, 2022
Jason Finn // Shutterstock

See how low property taxes in Utah are

Ask any homeowner about expenses and they’ll tell you: If you’re a first-time buyer, you need to carefully calculate the total cost of owning a home before taking the plunge into homeownership.

Owning a home comes with dozens of additional costs, from mortgage payments and interest to upkeep, renovations, and household utility bills. It doesn’t take long before expenses add up—especially when they come on top of potential property tax costs.

To determine which states offer the lowest in property taxes, Roofstock analyzed 2021 data from Wallethub and the U.S. Census Bureau. Costs were then determined for real estate property tax rates, median real estate tax payments, and median home prices for every state and Washington D.C. These amounts were then contextualized with what first-time homebuyers need to know about property taxes.

Utah by the numbers

- Effective real estate tax rate: 0.63%
- Annual taxes on $217.5k home: $1,362
- Utah's median home value: $279,100
- Annual taxes on Utah's median home: $1,748

Property tax rates in Utah are handled at the county level, and in each of Utah’s 360 separate tax districts, residential property is assessed at a value that is equal to 55% of market value. That isn’t what keeps Utah’s tax rates at the bottom of the list, though. What helps to keep Utah’s effective real estate tax rate lower than most of the rest of the nation is the Truth-in-Taxation law, which is a revenue-driven system that automatically lowers the property taxes in areas where the valuations of existing property have increased.

This reduction in property tax rates prevents local governments from automatically collecting more taxes just because the valuations of homes have increased, but that doesn’t necessarily mean that the property taxes in these areas can’t ever be increased. If local governments want to exceed the certified tax rate, they can go through the Truth-in-Taxation notification and hearing process—but in general, this automatic adjustment process is what keeps Utah’s real estate taxes low across the board.

In some states, the high cost of property taxes can cause a home with an otherwise affordable price tag to be well out of someone’s price range. In others, the low cost of property taxes could give you a little more wiggle room in your budget—which is never a bad thing.

If the idea of weighing the estimated costs of property taxes seems overwhelming to you, start by looking at the states with the lowest property taxes listed below. The national list is reverse-ordered by effective real estate tax rate, with Hawaii as the state with the lowest property taxes, though the results would look different if it was ordered by the taxes on the state's median home. Whether you're looking for a dream home or next big investment, owning a home comes with several additional costs, property taxes being one of them.

States with the lowest property taxes

#1. Hawaii: 0.28% effective real estate tax rate
#2. Alabama: 0.41% effective real estate tax rate
#3. Colorado: 0.51% effective real estate tax rate
#4. Louisiana: 0.55% effective real estate tax rate
#5. Washington, D.C.: 0.56% effective real estate tax rate

This story originally appeared on Roofstock and was produced and distributed in partnership with Stacker Studio.

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