NJ Has Nation's Highest Property Taxes, By A Long Shot: Report

NEW JERSEY — Life in New Jersey tends to guarantee two things: death and high property taxes. The Garden State pays the nation's highest rate on property taxes by a long shot, with an average bill that's 43 percent higher than the second-leading state, according to a new report from WalletHub.

New Jersey's effective real-estate tax rate in 2021 — the most recent year of data — was 2.47 percent, the highest in the U.S. The state also outpaced all others in terms of average annual taxes on a home of state-median value ($8,797 annually for a home valued at $355,700), WalletHub said in its report, released Monday.

That's 43 percent higher than the state with the second-highest tax bill on a median-priced home — $6,153 per year on a $286,700 property in Connecticut.

Although it doesn't make up the cost difference in real-estate taxes, New Jersey is one of 25 states without property taxes on vehicles. The nation's highest vehicle property-tax rate goes to Virginia — 3.96 percent, or $1,039 for a $26,000 car.

New Jersey routinely ranks among the highest in the nation when it comes to property taxes. Average payments and home values have gone up steadily throughout the state over the past decade, regardless of what political party is in power.

When former Gov. Chris Christie and the state Legislature reached a historic deal for a 2 percent cap in 2011, the average property tax bill in New Jersey was at $7,759 for a home valued at $299,014, not including credits or deductions. By the time Gov. Phil Murphy began his first term in 2018, the average property tax payment had risen by 13 percent.

Since Murphy took office, the cost of owning a home has continued to go up. The most recent state figures showed an average annual tax bill of $8,965 on a home worth $334,983 — New Jersey's average residential assessment.

New Jersey has the nation's eighth-highest median home value, according to WalletHub. But the areas with the most expensive properties also have significantly lower real-estate tax rates, including Hawaii (0.29 percent), the District of Columbia (0.57 percent), California (0.75 percent) and Massachusetts (1.2 percent).

Murphy tried alleviating some of the residential tax burden by introducing the ANCHOR rebate (Affordable New Jersey Communities for Homeowners and Renters), replacing the Homestead Rebate as the state's primary property-tax-relief program. The average rebate will total $971.

Eligible New Jersey residents have until Feb. 28 to file for the ANCHOR rebate. Read more: NJ's Tax-Rebate Deadline Is Soon: Did Your ANCHOR Application Process?

In the past, Murphy has also defended New Jersey's high taxes, saying they've helped the Garden State produce a higher standard of living than most around the country.

"The best public schools in America. It means among the best healthcare systems in America. It means a location second to none," Murphy told WNYC in October 2021, during his re-election campaign. "It means a quality of life. It means extraordinary diversity."

View WalletHub's full report on 2023's Property Taxes by State.