Louisiana is the #4 state with the lowest property taxes

Ask any homeowner about expenses and they’ll tell you: If you’re a first-time buyer, you need to carefully calculate the total cost of owning a home before taking the plunge into homeownership.

Owning a home comes with dozens of additional costs, from mortgage payments and interest to upkeep, renovations, and household utility bills. It doesn’t take long before expenses add up—especially when they come on top of potential property tax costs.

To determine which states offer the lowest in property taxes, Roofstock analyzed 2021 data from Wallethub and the U.S. Census Bureau. Costs were then determined for real estate property tax rates, median real estate tax payments, and median home prices for every state and Washington D.C. These amounts were then contextualized with what first-time homebuyers need to know about property taxes.

Louisiana by the numbers

- Effective real estate tax rate: 0.55%
- Annual taxes on $217.5k home: $1,187
- Louisiana's median home value: $163,100
- Annual taxes on Louisiana's median home: $890

There are several types of local government entities in Louisiana that can levy property taxes, and each tax authority has its own rates, which means that homeowners are being taxed by multiple entities each year. What’s surprising about that is that while there are multiple entities levying property taxes, Louisiana’s real estate tax structure still results in extremely low property tax rates for homeowners in this state.

Residential property in Louisiana is assessed at a value that is equal to 10% of market value, which means that a home with a full value of $100,000 would be taxed on just 10%, or $10,000. There are exemptions that help to further cut down on the real estate tax bills in this state, including the homestead exemption, which applies to owner-occupied primary residences and reduces the assessed value by $7,500. So, if a $100,000 home had an assessed value of just $10,000, claiming the homestead exemption would cut that value down to just $2,500. That results in extremely low property tax bills, even with several entities cashing in.

In some states, the high cost of property taxes can cause a home with an otherwise affordable price tag to be well out of someone’s price range. In others, the low cost of property taxes could give you a little more wiggle room in your budget—which is never a bad thing.

If the idea of weighing the estimated costs of property taxes seems overwhelming to you, start by looking at the states with the lowest property taxes listed below. The national list is reverse-ordered by effective real estate tax rate, with Hawaii as the state with the lowest property taxes, though the results would look different if it was ordered by the taxes on the state's median home. Whether you're looking for a dream home or next big investment, owning a home comes with several additional costs, property taxes being one of them.

States with the lowest property taxes

#1. Hawaii: 0.28% effective real estate tax rate
#2. Alabama: 0.41% effective real estate tax rate
#3. Colorado: 0.51% effective real estate tax rate
#4. Louisiana: 0.55% effective real estate tax rate
#5. Washington, D.C.: 0.56% effective real estate tax rate