Property tax compared with rent, state by state

Of the 40 states and the District of Columbia where we are licensed, New Jersey has the heaviest property tax bill against rent: the typical yearly tax on a home there equals about 46.5 dollars for every 100 dollars of a year’s typical rent, more than five months of rent. New Hampshire and Connecticut come next, at about 37 each. Alabama is lightest, at about 6.5, under one month of rent, and the national figure is about 18.4.

I put this table together for landlords comparing places to own a rental, including those looking at a DSCR loan, a business-purpose mortgage based on the property’s own rent instead of your personal income.

The table: 40 states and the District of Columbia

“Per 100” means the typical yearly property tax for every 100 dollars of a full year of typical rent. The margin of error is the Census Bureau’s, at 90 in 100 confidence: the true figure is likely within that distance either way. States run from the heaviest tax against rent to the lightest, with the national figure last. A linked name goes to our page on DSCR loans in that state.

Source: U.S. Census Bureau, American Community Survey 5-year estimates, 2020-2024, tables B25103 and B25064, read from data.census.gov on November 4, 2026. Shares and margins worked out by Fidelity Residential.

How the figures were worked out

• Property tax: the median yearly real estate tax paid on homes lived in by their owners, from the Census table on real estate taxes.
• Rent: the median monthly gross rent paid by renters, which includes utilities paid by the tenant; we multiplied it by 12 for a year. Every rent figure matches the one the Census Bureau publishes in its housing profile table, DP04.
• Per 100: the yearly tax divided by a year’s rent, times 100.
• Margins of error: combined from the Census Bureau’s own margins with its published formula for a ratio, so they are approximations.

What it can and cannot tell you

A state figure is a broad signal, with three limits:

• Two different groups of homes. The tax figure comes from owner-occupied homes and the rent figure from rented homes, so the share compares a typical tax bill with a typical rent, not the two sides of one rental.
• A landlord’s bill can be higher. Many states give homeowners an exemption or a lower assessment on the home they live in. A rental usually does not get it, so its tax can sit above the homeowner median in the same place.
• Five-year averages. These estimates pool 2020 to 2024. They describe that period, not this year’s tax bills or rents.

What the table shows

• The Northeast runs heavy. New Jersey, New Hampshire, Connecticut and Massachusetts are four of the six heaviest, with Illinois and Wisconsin. Texas is seventh.
• The South runs light. Alabama, South Carolina, Arkansas, Louisiana and Tennessee are among the lightest, with Hawaii, Arizona, Delaware and Nevada.
• Above and below the nation. Nineteen of the 41 are above the national figure of about 18.4 by more than their margins of error and 21 are below it; the District of Columbia is within its margin of it.

What it means for an investor

A DSCR loan compares the property’s monthly rent with its full monthly payment: principal, interest, property taxes, insurance and any association dues. Where the tax bill is heavy against rent, more of each month’s rent goes to tax before the loan, so the same rent covers less.

Put the property’s own tax bill, not a state figure, into our DSCR calculator to see its coverage. Our rent compared with home values table and our rental vacancy table cover the same 41, and our page on investment property loans sets out the ways to finance a rental.

Frequently asked questions

Why does the table show 40 states and the District of Columbia?

Fidelity Residential is licensed in 40 states and the District of Columbia, and the table covers those. The national figure covers the whole country.

Why compare property tax with rent?

Rent is what the property brings in, and property tax is one of the costs the rent has to carry.

Is a heavy share a reason to avoid a state?

Not on its own. Rents, prices, vacancy and the property itself matter as much.

Do property taxes affect a DSCR loan?

Yes. The full monthly payment the lender compares with the rent includes property taxes, so a higher tax bill means the rent must cover more.

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