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While Republican leaders across the country are waging war against property taxes after recent hikes, home insurance premiums represent a much heavier financial burden for millions of homeowners in several states, according to the latest data.
In Tennessee, the typical homeowner spends an estimated $284 a month on coverage—nearly double the estimated property tax bill of $143, according to a new study by personal finance website LendingTree.
In another Southern state, Alabama, homeowners spend an estimated $182 a month on home insurance and $93 on property taxes—once again, nearly double.
Their property tax bills pale compared to the ones paid by homeowners in New Jersey and New York—the two states with the highest estimated monthly property tax bills, at $863 and $626 respectively, according to LendingTree.
In New Jersey and New York, property taxes represent 23.4 percent and 19.5 percent of total housing costs, respectively, whereas, in Tennessee and Alabama, they account for 6.8 percent and 6.3 percent, respectively.
But homeowners in the two Northeastern states pay a lot less in home insurance than those in the two Southern states, with New Jerseyans facing an estimated monthly insurance bill of $159 and New Yorkers of $168.
Most significantly, home insurance represents only 4.3 percent and 5.2 percent of a homeowner’s share of monthly housing costs in New Jersey and New York, respectively, but it accounts for 13.4 percent and 12.3 percent of a household’s total housing costs in Tennessee and Alabama, respectively.
States Spending More on Home Insurance Than Property Taxes
Nationwide, homeowners spend an estimated $200 a month on insurance and $311 on property taxes. But homeowners in 15 states spend more on home insurance than on property taxes, according to LendingTree. These include:
- Tennessee ($284 v. $143)
- Alabama ($182 v. $93)
- Colorado ($463 v. $241)
- South Carolina ($259 v. $135)
- Arkansas ($200 v. $115)
- Oklahoma ($278 v. $178)
- Arizona ($238 v. $162)
- New Mexico ($244 v. $189)
- Idaho ($200 v. $163)
- Nebraska ($413 v. $350)
- Mississippi ($149 v. $131)
- West Virginia ($113 v. $101)
- Kentucky ($186 v. $167)
- North Carolina ($214 v. $196)
- Louisiana ($132 v. $125)
In two other states—Virginia ($234 v. $276) and Montana ($268 v. $267)—homeowners spend about the same amount on home insurance as they do on property taxes.
Many of the states where homeowners face the highest insurance burdens are also among the most disaster-prone, with risks ranging from hurricanes and flooding in the Southeast and Gulf Coast to tornadoes across the central U.S. and wildfires in the West.
The Role of Insurance and Property Taxes in the Crisis
While the rise in home prices which occurred during the pandemic years and the post-2022 surge in mortgage rates are the most obvious and discussed factors playing into the housing affordability crisis, higher property taxes and home insurance premiums are also contributing to making homeownership more expensive for many Americans.
Property taxes have surged by over 30 percent between 2019 and 2025, according to the latest data by Harvard University’s Joint Center for Housing Studies (JCHS), while home values soared by 54 percent since 2020.
Driven by more frequent and more severe natural disasters and elevated rebuilding costs, home insurance premiums have climbed 46 percent since 2021, according to Insurify—roughly three times as much as inflation. The insurance comparison website expects premiums to rise for the fifth straight year in 2026.
Overall, all these higher housing costs are making buying a home—and holding onto one—unaffordable for millions in the U.S. According to the latest Federal Reserve Bank of Atlanta’s Home Ownership Affordability Monitor (HOAM) data, the median-income household would need to spend 66.38 percent of its income to own the median-priced home in the United States.
Households spending more than 30 percent of their income on housing are considered “burdened.”
Congress has recently passed a sweeping housing package (which became law this month without President Donald Trump’s signature) meant to address the fundamental cause of the crisis—a chronic lack of inventory nationwide—and boost production.
At the local level, blue states and cities such as California and New York are trying to loosen regulations to encourage new construction, while GOP-led states like Florida and Texas are targeting higher property taxes and trying to cut them drastically, or even eliminate them.
When it comes to home insurance, disaster-prone states such as California and Florida have recently enacted reforms aimed at keeping insurers in the state and consumers covered in the face of growing risks and higher expenses. But even their best and most successful efforts—like Florida’s sweeping tort reform—have not stopped premiums from rising.
The U.S. government is now considering federal solutions to the nationwide emergency, including the establishment of a federal reinsurance backstop, sort of a public option that would help private insurers absorb catastrophic tail risks; the federal funding of large-scale residential retrofits to harden homes against natural disasters and make them more resilient; and expanding the U.S. Treasury’s role to catalog risk and identify coverage gaps through the National Catastrophe Risk Consortium.
Contact Newsweek editors on this story: Ben Kelly and James Debens
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