Tennessee is attracting new residents from across the country with its southern charm, stunning landscapes, and relatively low cost of living. If you're planning a move to the Volunteer State, one of the biggest financial perks you'll enjoy is lower property taxes — but there's more to the story than just the rate. Let’s break down what every new homeowner needs to know.

💸 How Low Are Tennessee Property Taxes?

Tennessee consistently ranks among the states with the lowest property tax burden. According to the Tax Foundation, Tennessee’s average effective property tax rate is around 0.56%, compared to the national average of roughly 0.99%.

For context:

• A $300,000 home in Tennessee would result in an annual property tax bill of around $1,680.

• That same home in New Jersey or Illinois? Easily over $6,000.

💡 Bonus Tip: Tennessee also has no state income tax, making it an attractive destination for retirees, remote workers, and investors.

🧾 How Property Taxes Are Calculated

Property taxes in Tennessee are based on your home’s assessed value, not its full market value.

Here’s how it works:

1. Assessment Ratio: Residential property is assessed at 25% of its appraised value.

2. Tax Rate: This is set by your county and/or city, and it varies widely.

3. Final Tax Bill = Assessed Value × Local Tax Rate

Example:
If your home is appraised at $300,000:

• Assessed value = $75,000 (25%)

• If your local tax rate is $2.75 per $100 of assessed value, your bill = $2,062.50

🏘️ County-by-County Differences Matter

Tennessee’s property tax rates are not uniform. Some counties — like Williamson and Davidson — have higher rates due to demand and services, while others like Sevier or Cumberland are much lower.

If you’re deciding where to buy, it’s worth comparing:

• Knox County (Knoxville): Balanced rate and strong schools

• Shelby County (Memphis): Higher tax rate, but larger city amenities

• Hamilton County (Chattanooga): Mid-range rate with urban/suburban mix

• Rutherford County (Murfreesboro): Popular with families and commuters

🧓 Tax Relief Programs for Seniors & Veterans

Tennessee offers property tax relief and freeze programs for:

• Homeowners 65+ meeting income requirements

• Disabled homeowners

• Disabled veterans or surviving spouses

These programs can significantly reduce or freeze the property tax bill — a huge benefit for retirees and those on fixed incomes. Be sure to apply annually through your local county trustee’s office.

📆 When and How to Pay

• Property taxes are due annually, typically in the fall (dates vary by county).

• Most counties allow online payments, and some even offer installment plans.

• If you escrow your taxes with your mortgage lender, they’ll handle the payments for you.

Final Thoughts

Tennessee’s property tax system is one of the many financial advantages of calling this state home. But like anything real estate-related, local knowledge is everything. Understanding how taxes are calculated, what exemptions you may qualify for, and how your chosen county stacks up can help you make the smartest move possible.

🤔 Have Questions About Buying in Tennessee?

Let’s talk! If you’re relocating and want a smooth transition, I’d love to be your guide. Leave a comment or give us a call — we’re here to help every step of the way.

🏡
Partners Realty Group
(865) 789 – 6677
"Where smart moves begin and strong roots grow."

Ready to take the next step? Let’s find your perfect Tennessee home today!