New Jersey Property Tax (2026): Rates & Buyer Impact
February 3, 2026
5 minutes
Here’s the truth: New Jersey homeowners are bleeding cash.
At a 2.23% average tax rate, NJ ranks #1 in the nation, costing the typical family $8,920/year on a $400K home. That’s more than the entire rent in 30+ other states.
But here’s what most people don’t realize: you can legally cut that number in half.
What You’ll Get in This 2025 Guide:
- Town-by-town property tax rates (sortable table - find your town instantly).
- How to file a tax appeal and save 10–25% on your bill.
- The 3 NJ exemptions worth $250–$1,500+ every year.
Millburn homeowner: $14,000/year
Cape May Point homeowner: $2,800/year
That’s $11,200/year back in your pocket just by choosing the right zip code.
NJ Property Tax Rates by Town (2025)
Not all of New Jersey is equally expensive. Moving just 5 miles can save you $10,000+/year in taxes.
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Here’s the 2025 breakdown of NJ property tax rates by town, ranked from highest → lowest:
| Town | 2025 Tax Rate (%) | Avg Annual Tax on $400K Home | Why It Matters |
|---|---|---|---|
| Millburn | 3.50% | $14,000 | Highest in NJ |
| Teaneck | 3.20% | $12,800 | High taxes + strong schools |
| Summit | 3.15% | $12,600 | Affluent commuter hub |
| Walpack Township | 1.05% | $4,200 | Rural, low-density living |
| Longport | 0.90% | $3,600 | Vacation-home favorite |
| Cape May Point | 0.70% | $2,800 | One of NJ’s lowest rates |
Math Snapshot
- Millburn vs Cape May Point: $14,000 – $2,800 = $11,200/year saved.
- That’s $933/month back in your pocket.
- Waiting 1 year to move = $11,200 gone to taxes.
Not always. Many low-tax towns (like Cape May Point) balance smaller budgets with lower infrastructure needs - without sacrificing safety or livability.
Each quarter you delay = another tax payment lost. Don’t let the state take more than it should.
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.
NJ Property Tax Exemptions You May Qualify For (2025)
Here’s the reality: most NJ homeowners are leaving $1,500+ on the table every year by not filing for exemptions they’re entitled to.
We’ve simplified the 2025 programs into one exemption matrix:
| Program | Annual Savings | Who Qualifies | How It Works |
|---|---|---|---|
| Veteran Deduction | Up to $250 | Honorably discharged veterans | Direct reduction on annual tax bill |
| Senior Freeze (PTR) | Locks your bill | 65+ or disabled, income < $163,050 | State reimburses any increases after your base year |
| Homestead Benefit | Up to $1,500 | Homeowners w/ income < $150,000 | Credit applied directly to tax bill |
Math Snapshot
- A qualifying senior veteran could stack Veteran ($250) + Homestead ($1,500) = $1,750/year saved.
- Over 10 years → $17,500 back in your pocket.
- Skip it? That’s $17,500 gone to Trenton.
- NJ’s exemption forms are 1–2 pages long. That’s 15 minutes of effort for $1,500+ in yearly savings.
Pro Tip: Many seniors combine exemptions AND choose homes in lower-tax towns. That’s how they save $10K+/year while still living in NJ.
How to Reduce Property Taxes in New Jersey (2025)
Most NJ homeowners think property taxes are non-negotiable. That’s wrong. With the right moves, you can legally slash your bill by $5K–$12K/year.
1. File a Tax Appeal (Deadline: April 1st)
- If your home’s assessed value is too high, you can appeal.
- 10–25% reductions are common when supported with recent sales comps.
- Example: A Bergen County homeowner cut their bill by $1,400/year after showing their home was assessed 12% higher than neighbors.
Thousands of NJ homeowners win every year, and even partial reductions compound into tens of thousands saved over time.
2. Apply for Exemptions
Stack the Senior Freeze, Veteran Deduction, and Homestead Benefit to save $250–$1,500+ per year. Don’t leave money with Trenton.
3. Avoid High-Tax Towns
Why pay $14,000 in Millburn when Cape May Point is $2,800? That’s an $11,200/year decision mistake.
4. Renovate Strategically
Every addition boosts your assessment. Only renovate when ROI > tax hit.
Math Snapshot
- Filing appeal: Save $1,200/year
- Homestead + Veteran: Save $1,750/year
- Moving towns: Save $11,200/year
Total potential = $14,150/year in savings
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How Property Taxes Work in New Jersey (2025)
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.
What Is the Average Property Tax in NJ in 2025?
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.
What Determines Your Property Taxes in NJ?
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:
- Municipal Budget Needs: Each town sets its own rate to fund local services - like schools, police, libraries, and trash collection.
- Your Assessed Property Value: Determined annually by a local tax assessor. If your home is valued higher than nearby homes, you’ll pay more.
- Property Improvements: Renovations like finished basements, additions, or solar panels may increase your home’s value - and your tax bill.
- 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%.
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How to Calculate Property Tax in New Jersey (2025)
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:
Step 1: Find Your Assessed Value
This is the value assigned by your local tax assessor. You can check it on your annual tax bill or the municipal website.
Step 2: Get Your Town’s Tax Rate (Mill Rate)
This is usually expressed as dollars per $1,000 of assessed value. For example, a 2.42% tax rate = 24.2 mills.
Step 3: Calculate Your Tax
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
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How New Jersey Compares to Other States in Property Taxes
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:
State | Avg Property Tax Rate | Annual Tax on $400K Home |
|---|---|---|
New Jersey | 2.23% | $8,920 |
Illinois | 2.08% | $8,320 |
Connecticut | 1.79% | $7,160 |
Texas | 1.68% | $6,720 |
| California | 0.75% | $3,000 |
What Happens If You Don’t Pay Property Taxes in NJ?
Missing a property tax payment in New Jersey doesn’t just sting - it snowballs fast.
Here’s how the penalties escalate step by step:
1. Interest Charges → 8% on the first $1,500, then 18% above that.
- Skip one $8,920 bill, and within a year, you could owe $10,500+.
2. Tax Lien Filed → After several months, your town files a lien.
- Liens can be sold to investors, who tack on even higher interest.
3. Tax Sale → After 1–2 years, your lien goes to public auction.
- Bidders can secure rights against your property.
4. Foreclosure → If unpaid, the lienholder can force foreclosure.
- You lose your home, equity, and credit score.
Math Snapshot
- $8,920 (avg annual NJ bill) → after 18% compounding → $21,000+ in 3 years.
- That’s 2.5X your original bill - gone.
Not safely. In NJ, towns are legally aggressive once a lien is filed, it rarely gets reversed without full repayment.
A Smarter Way to Buy a Home-and Save at Closing
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Every month you delay = ~$933 lost to property taxes.
FAQs
1. How can I appeal my property tax assessment in New Jersey?
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.
2. What is the Senior Freeze Program in NJ and who qualifies?
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.
3. How much is property tax in NJ in 2025?
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.
4. What are the lowest property tax towns in NJ?
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.
5. Can I get a property tax break as a veteran in NJ?
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.
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As a great communicator with excellent negotiation skills, I focus more on establishing unbreakable ties between my clients, as opposed to just helping them achieve their real estate dreams. As a representative of both buyers and sellers, I understand how to lead a transaction process to ensure that the needs of both are met. My track record speaks for itself. Since I ventured into the industry in 2013 as a realtor, I have not only helped many buyers land perfect homes, but I have also assisted tons of owners and investors build wealth.