Why Property Taxes Vary So Much by Location

You buy a house. You love the kitchen. You can live with the outdated carpet. But then the property tax bill shows up and… yikes. Your buddy two towns over is paying half as much for a house that’s the same size. What gives?

Yeah, property taxes can feel like a mystery wrapped in bureaucracy. But there’s a rhyme to the reason—several. So let’s pull the curtain back on why one homeowner gets a bill that feels like a gentle pat, while another feels like they just got hit with a frying pan.

The Basics First: What Property Taxes Are Actually For

At the core, property taxes are how local governments pay for stuff. Not glamorous stuff. Real stuff:

• Public schools
• Police and fire departments
• Roads, snow plows, trash pickup
• Libraries, parks, and rec centers

Every county, city, and school district has bills to pay, and they count on property taxes as one of their biggest sources of income. But how much they need—and how they decide to split the bill among residents—varies wildly depending on where you live.

So let’s get into the nuts and bolts of why those numbers jump around so much.

Reason #1: Local Budgets Are Wildly Different

Not all towns run on the same kind of budget. One city might need $500 million a year to run things, while a rural county down the highway operates on a fraction of that.

Here’s what drives that budget up:

• Large school districts with lots of students
• High demand for public services (transit, housing programs, safety nets)
• Big infrastructure needs (think: aging roads, bridges, public buildings)

Now, if a local government needs more money to function, guess what? They’re going to raise it from property owners. That’s where your bill starts ticking up.

And here’s the kicker: Even two neighboring cities can have wildly different priorities. One might be investing heavily in schools and social programs. The other might be more bare-bones. That local decision-making shows up directly in your property tax bill.

Reason #2: Property Values Aren’t Equal

You’ve probably seen it before: a 3-bed, 2-bath in Kansas goes for $180,000 while the same square footage in Palo Alto is seven figures, easy.

And guess what the tax is based on? Yep. The value of the property.

Let’s say City A has an average home value of $150,000, and it needs to raise $15 million a year. They might set their tax rate (called a millage rate) at something like 1.5%.

Now, City B, where average home values are $600,000, only needs $12 million. They can afford to set their rate lower—say, 1% or even less.

Sample Comparison Table

City	Avg Home Value	Tax Rate	Avg Annual Property Tax
City A	$150,000	1.5%	$2,250
City B	$600,000	1.0%	$6,000
City C	$400,000	2.0%	$8,000

Higher values don’t always mean lower rates, though. Some high-value areas still tax aggressively to fund expensive public services. But generally, the value of your home has a major impact on what you’re charged.

Reason #3: How Often Properties Are Reassessed

Here’s one of the sneakiest variables: reassessments.

Some places reassess home values every year. Others? Every five. Some wait even longer, which means a home bought 15 years ago might still be taxed based on what it was worth in 2010.

That affects fairness in a big way.

• If your city reassesses frequently, your tax bill stays more in line with current value.
• If reassessments are rare, long-time owners can end up paying way less than newcomers.

This is a major issue in places like California, where Prop 13 limits how much a home’s assessed value can increase per year. That keeps taxes low for people who’ve owned their homes a long time, but puts the burden more on newer buyers.

So when you hear that someone is paying less than you, it’s not always that their home is worth less. It might just be that it hasn’t been reassessed in ages.

Reason #4: Exemptions, Discounts & Caps

There are all kinds of carve-outs in property tax laws, and they can seriously shift the landscape.

Some common ones:

• Homestead Exemptions: Lower the taxable value of a primary residence.
• Senior Discounts: Many states give tax breaks to homeowners over a certain age.
• Veterans’ Exemptions: Reduced taxes for eligible military veterans.
• Caps on Increases: Limits how much taxes can go up year-to-year.

Florida, for instance, has Save Our Homes, which caps annual assessment increases at 3%. Texas has big homestead exemptions. In New York, STAR credits help with school taxes.

The result? Two houses on the same street can pay very different taxes, just based on who lives in them and how long they’ve owned them.

Reason #5: School Districts Matter More Than You Think

Your school district isn’t just about where your kids go. It’s one of the biggest drivers of property taxes.

Some school districts rely heavily on property tax funding. Others get more from state sources. The ones leaning on property taxes will have higher rates, period.

In fact, in many places, your property tax bill is a school tax bill with extras. In New Jersey, for example, over 50% of the average property tax goes to public education.

This is why people looking to sell house fast san diego often cite taxes as a motivator. San Diego spans multiple school districts, each with different funding levels. Some are more aggressively funded through local taxes, making some neighborhoods costlier to stay in long-term.

And don’t forget: better-funded schools usually mean higher real estate prices, too. So higher taxes often tag along with higher home values.

Reason #6: Local Politics and Voter Choices

Here’s something a lot of people don’t realize: property tax rates often reflect local political decisions.

• Voters approve school levies.
• City councils pass new funding measures.
• Counties decide how much to charge and what to charge for.

And those choices add up. In one city, residents might vote to increase taxes to improve school facilities or fund fire departments. Another city might lean toward cutting taxes and trimming services.

Even bond issues, where the city borrows money for a project and pays it back through taxes, impact your bill. The more voters say yes to spending, the more your taxes will reflect that.

So the difference in your bill might just be that people down the road are more (or less) willing to spend through taxation.

So What Can You Do About It?

If your bill feels way too high, you’re not powerless. Here are some real, practical moves you can make:

1. Check Your Assessment

Go through your property assessment line by line. Mistakes happen. If your home is listed as having a finished basement or extra square footage that it doesn’t have, you can challenge it.

2. File an Appeal

Most counties have a formal process for appealing assessments. You usually need to do it within a tight window, so act quickly after getting your notice.

Bring in comps—similar homes in your area with lower assessments—as evidence. Some folks even hire consultants who specialize in this.

3. Apply for Exemptions

Don’t leave money on the table. Look up what your city or county offers. Homestead exemptions alone can shave hundreds or even thousands off your bill.

4. Move Across a Boundary Line

If you’re looking to buy (or sell), research the tax rates by neighborhood, not just city. Even a half-mile move can put you in a different taxing district with a very different rate.

Wrapping It Up: It’s Not You. It’s the System.

You didn’t screw up. You didn’t buy the wrong house. Property taxes just aren’t fair in the way people think they should be.

It’s a system built on local decisions, uneven values, political choices, and a patchwork of exemptions that favor some more than others. Once you know what you’re looking at, it starts to make a lot more sense—even if it doesn’t feel any better on your wallet.

And if you’re thinking about moving because of it? Do your homework upfront. Compare districts. Look into reassessment cycles. And if you’re in an area like San Diego where the tax burden is getting out of hand, selling might make sense. Just make sure you talk to someone who knows how to move fast in that market.