Your Property Tax Bill Could Be Wrong: 40% of Homeowners Overpay by $539

As a homeowner, you're always looking for ways to save, from minimizing home energy costs to taking care of your own home repairs. But one of the smartest money moves for homeowners might have to do with changing a payment that you assumed was fixed: your yearly property taxes. In fact, you could be one of the 40% of American homeowners who are paying up to $500 more than they should in property taxes due to inaccurate property assessments.

Below, we explain why your home's property assessment might not align with its true market value, then explain how a new analysis from Realtor.com can help you figure out how to successfully appeal your assessment.

How over‑assessment happens

It might seem strange that your property taxes could be inaccurate, but lagging updates or uneven assessment practices can result in a mismatch between your home's true market value and its assessed value.

Realtor.com notes that multiple jurisdictions levy property taxes, but their assessment procedures aren't uniform, which can lead to incorrect property tax assessments. In fact, more than 23% of properties experienced a tax increase between 2023 and 2024 without a corresponding increase in home value.

Who it happens to

According to a 2024 study from Realtor.com, up to 40.5% of all American homeowners could save money by protesting their property tax assessment. Those homeowners could save a median amount of $539 per year, which is 15.4% percent of the median property tax bill of $3,500.

State‑by‑state opportunities

Residents in some states are more likely to be overpaying on their property tax bills than those in others. Realtor.com specifically calls out the following states:

• Texas, where up to 51.2% of homes could benefit from protesting, with a median savings of $606.66.
• South Dakota, where 48.3% of homes could benefit from protesting with a median savings of $431.23.
• California, where 47.8% of homes could benefit from protesting, with a median savings of $1,875.12.
• Iowa, where 47.3% of homes could benefit from protesting, with a median savings of $368.91.
• Illinois, where 46.5% of homes could benefit from protesting, with a median savings of $629.76.

While residents of the other 45 states could certainly benefit from protesting their current property tax valuation, homeowners in these five states should prioritize doing so — there's nearly a one in two chance they could bring their bill down.

Why discrepancies exist

So why exactly are property values so out of sync with property taxes? The answer depends in no small part on where you live. For instance, in places like California, caps on annual assess­ment increases create dramatic variations between homes, making some appear overvalued compared to their neighbors.

In contrast, property assessments in Iowa and South Dakota appear to vary more dramatically between homes. The clear lack of uniformity could make protesting your property's value assessment a potentially effective way to save money.

Use a new support tool

You don't need to do the math yourself to figure out whether your home has been overvalued.

Realtor.com now offers a free feature that compares your home's assessment to similar local properties, which can help you build a stronger appeal case. Entering your home address is all you need to get started.

Of course, using the tool is just the first step. From there, if you notice a dramatic contrast between your home's value and that of similar local properties, it's time to protest your current property value to ensure you aren't overpaying your property taxes. Get started with the steps below.

Gather comparables

Start by using a tool like the one above to compare your home's value to that of other properties in your area. You'll want to look at homes with a square footage similar to yours that were built during the same timeframe.

Bear in mind that your property's value could be higher than your neighbors' for a variety of reasons, from your home's remodels to the exact part of town you live in. A discrepancy between your home's value and others' doesn't necessarily mean you're being overcharged — but it does give you a good reason to double-check that your home was assessed properly.

Submit through official channels

You must submit your appeal through your city or county's tax authority, following the official processes established by your specific area. Pay attention to paperwork requirements, since small mistakes could get your application rejected, requiring you to start over and potentially miss key tax deadlines.

Meet deadlines

Your local tax office should send you a yearly property tax assessment, usually near the start of the year. As soon as you receive your letter, check the deadlines for the appeal, and know that missing the appeal means you'll be stuck paying the amount issued in the official letter.

Have the right expectations when working with assessors

Doing the research might lead you to believe you're guaranteed to experience a reduction in property taxes, but don't forget that the property assessor gets final say. If you choose to hire an appraiser who assesses properties for a living, there's a good chance they understand more about your city's tax codes than you do.

While this doesn't necessarily mean you should assume you're wrong and your assessor is right, you should gear yourself up to accept their professional opinion — even if they determine your tax bill should go up, not down.

Bottom line

If you go through the steps above and learn there's no way to lower your property tax bill, try not to sweat it. There are countless other ways to build your wealth by saving around the house, from switching to a better insurance provider to upgrading old appliances for energy efficiency's sake.

Plus, even if your property tax assessment is accurate this year, it might not be a few years down the road. Bearing these tips in mind can help you later on, so don't forget to follow up.