• 1.1% is the median property tax rate in the United States.
• $3,719 was the average property tax payment made in 2020.
• 323 billion dollars was collected in 2020.

• 2.42% is New Jersey’s property tax rate, which is the highest.
• $446,000 is the median home price in New Jersey.
• $10,800 was the average payment in 2021.

• 0.28% is Hawaii’s property tax rate, which is the lowest nationally.
• $863,000 is the median home price in Hawaii.
• $2,416 was the average payment in 2021.

Which that alone is an example of how expensive property taxes can get, where New Jersey has an average home price only slightly above half of what Hawaii does, but the average person in New Jersey spends over 4x as much on property taxes.

Why this is a big deal.

13 years is the average length of home ownership in the US.

The area which has the lowest average length of home ownership currently is Austin, Texas, with Austin’s average going from normal to lowest in the last 10-20 years.

• $624,000 is the median home price in Austin currently.
• $261,000 was the median in 2012.
• A 124% increase.

Comparing that, the median home price was $210,000 nationally in 2012.
$374,000 is the current median home price.
A 78% increase.

Both numbers largely due to a post 2008 recession surge, but Austin has had home values more than double in the last decade.

Most people look at Texas and think good taxes, but property tax wise, they are actually one of the worst in the United States, with a 1.7% rate, making them the 6th highest in the country.

This is why so many people are moving out of Austin.

They have real estate prices go up and along with an obvious incentive to sell increasing, property tax bills going up with it also add to it.

Which proof of this would be California, which actually has fairly low property taxes nationally at .7%, but it has an interesting loophole.

California property taxes don’t adjust often and is one of the only states which taxes people on at the rate they initially paid for the home. There’s a limit in the state, where rates can only rise 2% a year, which falls way below home value in most cases.

This is why Los Angelos actually has the longest average for home ownership, with the average ownership length being 18 years.

Why property/land taxes end up hurting middle and lower income people.

People buy homes in more up and coming areas, before they were growing.

They stay there for years, but when the areas pickup, prices tend to grow with it and the property tax bill to stay climbs, making a move hit.

That reason to move in 10 years versus 20 years could be a major factor people to sell their homes early and miss out on much larger returns.

And this is why I don’t think property/land taxes work.

There was an economist a century ago named Henry George, who was a brilliant man and focused a lot on land value taxes being the driving force for funding the government.

That model worked and even influenced how China operates, where most land buyouts are capped at 99 years of ownership.

Henry George has a bit of a cult behind him, with the land tax as a goal, but the problem is it’s sort of an out of date idea.

When Henry George had it, wealth was land.

Whoever had the most valuable land was the wealthiest person.

Today, Google could realistically operate on a random farm in Kentucky and still be Google.

With that, I think we’ve hit a point property taxes are an idea of the past and should probably be eliminated and moved to a straight flat tax on income.