California’s property tax rate is relatively low compared to other states, but soaring home prices mean many homeowners still pay some of the highest property tax bills in the country. In fact, Palo Alto residents pay the highest median property taxes nationwide at $23,007 per year, according to a Construction Coverage analysis of U.S. Census Bureau data.
Property tax burdens vary widely across the country. Illinois has the highest effective property tax rate at 1.793%, followed by New Jersey (1.675%), Vermont (1.399%), Nebraska (1.379%), and Connecticut (1.355%), according to the report. California’s effective rate, by comparison, is under 1%.
Despite its lower effective rate, several California cities rank among the highest nationwide for median property taxes paid.
Palo Alto ranks first for median property taxes paid at $23,007 annually, despite having an effective tax rate of 0.657%. The city’s median home value exceeds $2 million and can surpass $3 million in some cases, meaning that even a relatively modest tax rate results in a substantial tax bill.
Several other California cities also rank among the highest nationwide for median property taxes paid. In Newport Beach, the effective rate is 0.557%, yet the median tax bill is $19,232. Santa Monica homeowners pay a median of $14,328 at a 0.643% rate, while Berkeley records $14,324 at 0.900%.
San Ramon homeowners pay a median of $14,266 with a 0.782% rate. In San Mateo, the rate is 0.767%, with median taxes of $13,705. Mountain View posts $13,310 at 0.642%, Dublin shows $13,243 at 0.905%, and San Francisco’s median tax bill is $12,657 with a 0.786% rate.
California’s housing affordability has shown modest improvement. According to the California Association of Realtors, 18% of households could afford the state’s $869,300 median-priced home in the fourth quarter of 2025, up from 17% in the third quarter and 16% a year earlier.
Buyers needed a minimum annual income of $213,200 to afford monthly payments of $5,330, including principal, interest, taxes, and insurance, on a 30-year fixed-rate mortgage at 6.35%.
California’s median home price is projected to rise 3.6% to $905,000 in 2026, following an expected increase to $873,900 in 2025. Housing affordability is projected to remain at 18%.
Nationwide, property tax revenue increased by more than $96 billion between 2022 and 2024, rising from $703 billion to $800 billion, according to Construction Coverage’s analysis of Census Bureau data.
The rankings are based on data from the U.S. Census Bureau’s 2024 American Community Survey. Researchers at Construction Coverage calculated effective property tax rates for owner-occupied homes by dividing total real estate taxes paid by the total value of housing units.
While cities in New Jersey, Illinois, Connecticut, and New York dominate the rankings for highest effective property tax rates, California cities stand out when ranked by median property taxes paid.
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