Property taxes are an expensive piece of the homeownership pie, according to a new analyis by LendingTree.com.
In fact, homeowners pay a median of $3,119 annually in property taxes — or $260 a month — as of 2024, according to the LendingTree analysis. Overall, the analysis found that property taxes rose 5.1% — or $150 — from 2023 to 2024.
LendingTree noted that the figure reflects a years-long upward trend.
LendingTree said that the last time it conducted this study, it found that property taxes rose 10.4% between 2021 and 2023. Between 2019 and 2024, property taxes nationwide increased by 30%, according to the Institute on Taxation and Economic Policy (ITEP), which LendingTree noted is a direct consequence of the pandemic-era housing boom that sent assessed home values soaring across much of the nation.
The online loan marketplace said the tax burden isn’t evenly distributed. Homeowners carrying a mortgage pay $913 more per year than those who own their homes outright — $3,489 versus $2,576.
Matt Schulz, LendingTree chief consumer finance analyst and author of “Ask Questions, Save Money, Make More: How to Take Control of Your Financial Life,” said the difference is a big deal for first-time homebuyers.
Who is the Homeowner?
“When considering the costs of homeownership, too many people take too narrow a view,” Schulz said. “They think about the home price, interest rates, and closing costs, but they don’t always consider other recurring costs over the long run, including property taxes, homeowners association (HOA) fees, and insurance. If you’re not considering all these costs and more when thinking about how much house you can afford, you’re doing yourself a disservice. These costs matter, and you ignore them at your peril.”
LendingTree noted that a part of the property tax gap between those with a mortgage and those without may come down to where the two groups sit on the housing ladder. Mortgaged homeowners, LendingTree said, are more often recent buyers who bought at higher prices and carry higher assessed values as a result.
There could be a structural factor, too, LendingTree noted.
Most lenders require an escrow account, through which a portion of the monthly mortgage payment is set aside to cover property taxes.
Should the tax bill increase, the escrow portion adjusts higher to cover the difference, LendingTree noted.
The difference in property tax payments tends to play out more sharply at the lower end of the tax spectrum, LendingTree said. For example, households without a mortgage are 2.4 times more likely to pay less than $800 in property taxes than those with one.
Across the metros looked at, 17.7% of mortgage-free households fall into that bracket, compared with just 7.5% of mortgage holders, LendingTree said.
Property Taxes Heading Up
On the other end, more than half (56.1%) of mortgaged households paid $3,000 or more in property taxes in 2024, compared with 43.8% of those without a mortgage, LendingTree said.
No matter where homeowners live, property taxes are heading in one direction, and that is up. Property taxes increased in every one of the 50 largest U.S. metros between 2023 and 2024, LendingTree noted.
Among the hardest hit metros, Tampa, Florida, ranks first, with property taxes rising 7.7%. Denver (7.4%) and Miami (7.1%) follow, the website said.
Lower property tax bills may feel like a good thing, but Schulz notes there could be trade-offs.
“For one, the typical property tax bill could be lower because home prices in the area are lower or stagnant, making it harder for homeowners to build equity,” he said. “Also, in many areas, schools rely on property taxes heavily, so lower taxes could mean lower-quality schools. In addition, sales taxes or income taxes could be higher in some places to make up for lower property taxes.”
Milwaukee (0.7%), Phoenix (1%) and Memphis, Tennessee (1.1%), saw the smallest increases in property taxes.
Schulz said that high home values play a role, it isn’t everything.
“The property tax rates are a major factor as well,” he said. “For example, homes in Austin and Dallas aren’t nearly as expensive as homes in the biggest coastal cities, but they have property tax rates that can be double or more what you’d find in those cities. As a longtime homeowner in Austin, I can tell you first-hand that the property tax burden here is no joke.”
Home values in California are generally higher, and homeowners can pay more in raw dollars even when the rate is lower, LendingTree aid. In Texas, however, it’s the rate itself that drives the burden.
Texas Reassesses Annually
Texas reassesses property values annually based on current market data, with no equivalent to California’s Proposition 13 to prevent large year-over-year increases — meaning faster-growing areas such as Austin and Dallas have seen tax bills climb significantly without any changes to the actual property.
Mortgaged homeowners generally face higher property tax bills than those who own their homes free and clear, but LendingTree said there are a handful of exceptions.
Homeowners with mortgages typically pay higher property taxes in nearly all metros, but that’s not the case in Seattle, Salt Lake City, Boston, Washington, D.C., and Virginia Beach, where mortgage-free homeowners carry a comparatively heavier tax load.
