Alabama vs Iowa
Property‑Tax Comparison: Alabama vs. Iowa
Intro
Both Alabama and Iowa levy property taxes on real‑estate owners, but the effective rates and resulting annual payments differ substantially. According to the U.S. Census Bureau's 2023 American Community Survey (5‑year estimates), Alabama’s effective property‑tax rate is 0.38 %, while Iowa’s is 1.43 %. The gap translates into lower annual tax bills for comparable home values in Alabama.
Side‑by‑Side Metrics
| Metric | Alabama | Iowa |
|---|---|---|
| Effective property‑tax rate | 0.38 % | 1.43 % |
| Median home value | $195,100 | $195,900 |
| Median annual property tax | $738 | $2,795 |
| Property tax on a $250,000 home | $946 | $3,567 |
| Property tax on a $500,000 home | $1,892 | $7,134 |
| Median household income | $62,027 | $73,147 |
Sources: Alabama property tax and Iowa property tax; data from the U.S. Census Bureau's 2023 ACS (5‑year).
Who Wins the Property‑Tax Comparison?
Alabama wins on the basis of a lower effective property‑tax rate.
- Rate difference: 1.05 percentage points, which is a 73.48 % lower rate than Iowa’s.
- Annual tax difference for a $250 k home: $2,621 less in Alabama.
- Annual tax difference for a $500 k home: $5,242 less in Alabama.
The lower rate in Alabama results from the state’s reliance on a combination of local‑government assessments and relatively modest millage levels, whereas Iowa’s higher rate reflects higher local service funding needs and a broader use of property tax for school financing.
Which Audiences May Find This Comparison Useful?
| Audience | Relevance of the Comparison |
|---|---|
| Current or prospective homeowners | Understanding the recurring cost of ownership helps in budgeting and selecting a location. |
| Retirees and fixed‑income households | Lower property taxes can reduce the overall cost of living, especially when income is limited. |
| Real‑estate investors | Property‑tax differentials affect cash‑flow projections and net‑return calculations. |
| Policy analysts | The data illustrate how state‑level tax structures impact local tax burdens. |
The comparison is factual and based solely on the most recent ACS estimates; it does not incorporate other tax categories (e.g., income or sales tax) or non‑tax factors such as climate, employment opportunities, or public services.
Summary
Based on the most recent ACS estimates, Alabama’s effective property‑tax rate of 0.38 % is significantly lower than Iowa’s 1.43 %. Consequently, homeowners in Alabama face lower annual property‑tax bills across a range of home values. This information is most pertinent to individuals and entities evaluating the ongoing cost of home ownership or investment in either state.
Explore More Comparisons
Discover how property taxes compare across all states in our comprehensive comparison guide.
Data Source
All figures are drawn from the U.S. Census Bureau's 2023 American Community Survey (5‑year estimates). This comprehensive dataset provides reliable, standardized property tax information across all states.