Pay Less on Property Taxes—How 40% of Americans Can Save

Homeowners have faced a bevy of rising bills in recent years—from higher mortgage payments to soaring insurance costs and, for some, HOA fees.

Another guaranteed expense: property taxes. But nearly half of Americans can save on their bills, according to a new report by Realtor.com® economists. It found that the median tax bill in the U.S. in 2024 was $3,500, up 2.8% from 2023.

The report also highlights how and where property taxes have changed, and proposes a solution for some homeowners to get some relief by protesting their tax assessments. Nationwide, 40.5% of properties could benefit by lowering their assessments.

A new tool just launched on Realtor.com allows homeowners to compare their home's assessment value to similar homes, and it provides a set of data on comparable properties that homeowners can use as evidence in their appeal.

The map below shows the median property tax burden in each state, with the color corresponding to how much that value grew from 2023 to 2024.

Exactly how much people will save in property taxes will vary across the U.S. The five states with the highest share of properties that could benefit from property tax protesting are:

Texas

• Share of homes identified for protesting: 51.2%

• Median estimated savings from protesting: $606.66

South Dakota

• Share of homes identified for protesting: 48.3%

• Median estimated savings from protesting: $431.23

California

• Share of homes identified for protesting: 47.8%

• Median estimated savings from protesting: $1,875.12

Iowa

• Share of homes identified for protesting: 47.3%

• Median estimated savings from protesting: $368.91

Illinois

• Share of homes identified for protesting: 46.5%

• Median estimated savings from protesting: $629.76

"This large subset of the housing stock could see significant savings. The median property identified by this methodology could save over $539 per year, a 15.4% reduction of the median property tax bill of $3,500 in 2024," explains Joel Berner, senior economist at Realtor.com.

Here is the methodology that Realtor.com economists used: For the year-over-year analysis, tax records from 2023 and 2024 are collected from properties only where both years are available. Data is from the Realtor.com tax assessment database. Year-over-year changes are calculated at the property level and aggregated by state from there. Vermont, Indiana, Illinois, Arkansas, Washington, D.C., North Dakota, and South Dakota were excluded from the year-over-year analysis due to missing data.

The report found that Texas, California, and Illinois are "relatively high-tax states," so a small change in assessment values could result in significant property tax savings.

Some states, like California, have annual assessment value increases capped. So, additional variation in assessment values between similar properties in the same county is created. The economists go on to explain that this will lead to more instances in which, for a given property, there could be comparable properties assessed at much lower rates. This could inflate the number of properties that look like they are overassessed, but really just have comparable properties with old assessments that are locked into lower valuations by the cap.

South Dakota and Iowa were found to be in the middle of the pack for effective tax rates, but with higher variation in assessment values—that means protesting could lead to tax savings for homeowners there.

How property taxes are calculated

States, counties, and cities can collect property taxes. The tax rate varies by jurisdiction. Property taxes are calculated by taking the assessed value of a property and multiplying it by the local property tax rate where the house is located.

Property taxes are paid annually (semiannually or quarterly are given options, too). They're the biggest source of revenue for a city and are used to fund local services, such as public schools, public services (road repairs and maintenance), police, and fire departments.