New Jersey Property Tax 2025: Rates, Hacks & Savings

Feeling Trapped by New Jersey's Sky-High Property Taxes?

You’re not alone. With a 2.23% average property tax rate, NJ ranks as the #1 most taxed state in the U.S. That’s nearly $9,000/year on a $400K home — more than monthly rent in many states.

But here's the good news:

You can cut that number in half.

Whether you're a homeowner or buyer, this 2025 guide breaks down how NJ property taxes work, how to calculate your bill, and where you can save thousands through the right exemptions, counties, and mortgage moves.

We’ll show you:

• NJ towns with the lowest tax rates
• How to appeal your tax assessment
• Where to get up to $1,500 in rebates
• And how reAlpha helps you skip the 3% agent fee — covering an entire year’s tax bill

Moving just a few miles can save you over $10,000/year in taxes. Looking to buy in a low-tax zone? Explore these affordable NJ towns close to NYC.

You can legally reduce your NJ property tax bill through appeals, exemptions, and smart home choices.

Here’s how thousands of homeowners are slashing their bills:

• File a Tax Appeal: If your home’s assessed value is too high, you can appeal by April 1st. Many appeals result in 10–25% reductions.
• Apply for Exemptions: Use the Senior Freeze, Veteran Deduction, and Homestead Benefit to save $250–$1,500 annually.
• Avoid High-Tax Towns: Some NJ towns have rates over 3.5%. Opt for places like Cape May or Walpack to save $8,000+/year.
• Downsize or Renovate Strategically: Additions can increase your assessed value. Renovate only when ROI outweighs tax hikes.

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NJ property taxes are based on your home’s assessed market value—then multiplied by your town’s unique tax rate.

New Jersey uses an ad valorem system, meaning taxes are based on your property’s market value. Here’s how it works step-by-step:

• 1. Assessment: Local assessors evaluate each property annually. Your home’s full market value becomes its assessed value.
• 2. Tax Rate Set Locally: Each NJ town sets its rate (called a “general tax rate” or “mill rate”) based on how much it needs to fund schools, roads, and services.
• 3. Final Tax Bill: Multiply your assessed value by the local tax rate.

Example:

If your home is worth $500,000 and your town’s rate is 2.23%, your annual bill = $11,150.

Note: Improvements like new decks or renovations can raise your assessed value, increasing taxes.

Quarterly Payments: NJ property taxes are billed four times a year. Late payments = interest up to 18% and potential liens or foreclosure.

At 2.23%, NJ has the highest property taxes in America—but some towns offer rates under 1%.

The statewide average effective property tax rate in 2025 is 2.23%. That’s about $8,920/year for a $400,000 home.

But your actual bill can vary drastically by location:

• Cape May Point (0.7%): $2,800/year
• Millburn (3.5%): $14,000/year
• Ocean County: Popular for retirees due to lower tax loads

Always compare rates before buying—it can mean saving $10,000+/year.

Your NJ property tax bill depends on your town’s budget, your home’s assessed value, and any renovations or exemptions.

Here are the 4 key factors that affect your New Jersey property tax rate:

1. Municipal Budget Needs: Each town sets its own rate to fund local services—like schools, police, libraries, and trash collection.
2. Your Assessed Property Value: Determined annually by a local tax assessor. If your home is valued higher than nearby homes, you’ll pay more.
3. Property Improvements: Renovations like finished basements, additions, or solar panels may increase your home’s value—and your tax bill.
4. Location: Urban areas tend to have higher rates due to increased service needs. Some counties have multiple taxing jurisdictions layered together.

Example: A home in Millburn might be taxed at 3.5%, while a similar home in Longport may only be taxed at 0.9%.

Use your town’s mill rate and your home’s assessed value to calculate your NJ property tax.

Here’s how to do it in 3 simple steps:

This is the value assigned by your local tax assessor. You can check it on your annual tax bill or the municipal website.

This is usually expressed as dollars per $1,000 of assessed value. For example, a 2.42% tax rate = 24.2 mills.

Use this formula:

Tax= (assessed value * tax rate/100)

Example Calculation

• Assessed Value: $300,000
• Tax Rate: 2.42%
• Property Tax: ($300,000 × 2.42) ÷ 100 = $7,260/year

Pro Tip: Use reAlpha’s commission-free real estate tools to factor tax savings directly into your homebuying budget.

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You could save $250 to $1,500+ per year through NJ’s property tax exemptions—if you meet the right criteria.

Here are New Jersey’s 3 most powerful exemptions:

• Amount: Up to $250/year

• Eligibility: Honorably discharged U.S. military veterans

• Bonus: Some disabled veterans may qualify for full exemption

How to Apply: Submit Form V.S.S. with your DD-214 to your local assessor’s office.

• Benefit: “Freezes” your property taxes at your current level

• Eligibility in 2025:
• Age 65+ or receiving federal disability benefits
• NJ resident for 10+ years
• Owned and lived in home 3+ years
• 2024 income under $163,050

💡 Even if your town raises its tax rate, your bill stays locked if approved.

• Benefit: Rebates up to $1,500 depending on income + home value

• Eligibility:
• Must be a primary residence owner
• Income must be under $150,000

Pro Tip: You can stack these exemptions. Many seniors use both the Senior Freeze + Homestead to save $2,000+ per year.

New Jersey has the highest average property tax rate in the U.S.—but some states charge less than half.

Here’s how New Jersey stacks up:

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Missing a property tax payment in NJ can lead to interest charges, liens, tax sales, and even foreclosure.

Here’s how it escalates:

• 8% on the first $1,500
• 18% on any amount above that
• Penalties kick in 9 days after the due date

• Your town may file a lien if unpaid for several months

• Liens can be sold to investors who charge more interest

• After 1–2 years, the town may auction your tax lien publicly

• The lienholder can begin foreclosure proceedings if not repaid

• If unresolved for 2+ years, your home can be legally taken and sold
• This process can damage your credit and equity permanently

Avoid it: Enroll in autopay, apply for hardship relief, and seek exemptions if eligible.

New Jersey’s tax rates might be the highest in the nation, but you don’t have to pay full price.

With the right strategy—appealing your assessment, leveraging veteran and senior exemptions, and choosing a low-tax town—you could save $5,000 to $12,000 annually.

And if you buy with reAlpha, you skip the traditional 3% real estate commission. That’s $9,000 in instant savings on a $300,000 home—enough to cover an entire year of NJ property taxes.

Get started with commission-free homebuying in New Jersey today.

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If you believe your home's assessed value is too high, you can appeal your property tax assessment by filing with your County Board of Taxation. The deadline is typically April 1st each year, though some counties may vary. To build a strong case, include comparable property sales, a recent independent appraisal, or evidence of a decline in your neighborhood’s market value. If your appeal is denied, you can escalate it to the New Jersey Tax Court within 45 days. A successful appeal can save homeowners hundreds to thousands of dollars annually.

Example: A homeowner in Bergen County lowered their tax bill by $1,400/year after showing that similar homes nearby were assessed 12% lower.

The Senior Freeze (Property Tax Reimbursement) Program lets eligible NJ seniors and disabled residents lock in their current property tax level—even if rates rise in the future. To qualify in 2025, you must:

• Be 65 or older (or receiving federal disability benefits)
• Have lived in NJ for at least 10 consecutive years
• Have owned and lived in your home for at least 3 years
• Meet income limits (under $163,050 for 2024)

You must pay your taxes in full and on time to be eligible. The state will reimburse you for any tax increases after your “base year.” This benefit can add up to thousands in annual savings over time.

As of 2025, New Jersey’s average property tax rate is 2.23%, the highest in the United States. That means if you own a $400,000 home, your annual property tax bill would be about $8,920. However, tax rates vary significantly depending on the municipality. Some towns charge less than 1%, while others exceed 3.5%. Always check the local tax rate and assessed value before buying a property in NJ, as it can impact your monthly budget by hundreds of dollars.

Some of the lowest property tax rates in New Jersey can be found in Cape May Point, Longport, and Walpack Township, where rates range from 0.7% to 1.05%. These towns tend to have smaller populations and lower infrastructure costs. For example, a $400,000 home in Cape May Point would cost about $2,800/year in property taxes—versus $14,000+ in Millburn. If you’re looking for affordability, always compare effective tax rates across towns before committing to a home.

Yes, New Jersey offers a $250 annual property tax deduction to eligible veterans. To qualify, you must be an honorably discharged U.S. military veteran who owns (or partially owns) a property in NJ. Additional benefits may apply for veterans with service-connected disabilities, including full property tax exemption in certain cases. Applications must include proof of honorable discharge (DD-214) and be filed with your municipal tax office.

Find the Perfect Mortgage in New Jersey with Be My Neighbor.

Compare options, calculate payments, and get expert guidance—all in one place.

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