Property taxes across the United States rose 3.7% in 2025, outpacing the 2.7% increase in overall inflation as measured by the Consumer Price Index, according to a recent analysis by real estate data firm ATTOM. The average homeowner paid $4,427 in property taxes last year, even as the typical single-family home value declined by 1.7% to $494,231.
The rise in property taxes despite falling home values underscores that local governments often adjust tax rates based on budgetary needs rather than property assessments alone. Property taxes constitute about 70 cents of every local tax dollar, funding essential services such as public schools, road maintenance, and emergency response.
State-Level Variations in Property Tax Changes
Homeowners in Delaware experienced the steepest increases, with property taxes rising 18%, followed by an 11.6% increase in Maryland. By contrast, 10 states, mostly in the Western U.S., saw property tax declines. Notable examples include Wyoming, which enacted a 25% tax cut on properties valued up to $1 million, and Montana, where approximately 80% of homeowners benefited from new rebates and a tiered tax system.
ATTOM CEO Rob Barber explained, “Property taxes often rise faster than inflation because they’re driven by local government funding needs, not consumer prices. Municipalities may increase taxes to cover rising costs for schools, infrastructure, and public services regardless of inflation.”
Highest and Lowest Property Tax Burdens
The analysis found that homeowners in the Northeast, California, and Illinois tend to pay the highest property taxes, with New Jersey averaging about $10,500 annually per homeowner. In contrast, West Virginia reports the lowest average property tax, at $1,081 per homeowner.
Why it matters
The continuing increase in property taxes ahead of inflation affects homeowner budgets and may influence housing affordability and local political debates over tax policy. The disparity in tax changes among states reflects varied approaches to funding local services, economic reliance on other revenue sources, and legislative efforts to reduce tax burdens in some regions.
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