Of the top ten counties in the US that pay the highest property tax rates, all ten of them come from either New York or New Jersey. New Hampshire and Connecticut also have several counties listed high up in the rankings.
Meanwhile, at the opposite end of the spectrum, the states of Alaska and Louisiana have the lowest property tax rates in the country, says the Washington-based Tax Foundation, a non-profit organization that conducts research into taxation.
The property tax report used data from the national census stretching back over five years, ending in 2009.
According to Tax Foundation analyst Nick Kasprak, there are two main factors that contribute directly towards higher property tax rates – revenues shared by state governments and services provided by those governments.
“Where local governments are responsible for more community services and programs, state residents unfortunately have to pay for it through their property tax,” he explained.
He said that counties in the north east typically spent more on schools, police and fire departments, and recreational facilities than other parts of the country do.
Areas with lower property tax rates spend much less on these kinds of services, Kasprak says. For instance, some of them may have volunteer fire departments only.
Kasprak also pointed out that certain states in the US require local governments to foot the bill for such things as low income housing or minimum schools standards, and these are paid for through property tax increases.
Counties with lower property tax rates often receive additional revenue from industries such as gambling or oil production too, and this helps those governments ease the burden on their residents. For example, both Alaska and Louisiana supplement much of their budget in this way.
Unfortunately for New York/New Jersey residents, there states have no such resources to call upon, and coupled with better quality services, this is why Hunterdon County residents face the highest property tax bills in the country, averaging $8,216 a year.
Nassau on Long Island is also considerably expensive, at $8,206 per year, just ahead of Westchester.
Compare this with Fairbanks County in Alaska, where residents pay on average just $109 each year, which works out to be just 0.07% on a home valued at the national median of $159,300.