NH Property Tax by Town: What You'll Actually Pay in Salem, Windham, and Derry

How NH property tax actually works

NH property tax math is simple, and that is the good news. The bad news is that the numbers are bigger than most MA relocators expect.

The formula is the same in every town: mill rate times assessed value, divided by 1,000, equals your annual bill. A $500,000 assessment at a $20.00 mill rate is $10,000 a year. That is the whole bill, not just the school portion, because NH towns roll four separate lines into one rate: town operations, the local school, the state-education line, and the county. You see all four on your tax card, but you pay one number.

Bills are issued twice a year. The first bill in June or July is an estimate based on the prior year's rate. The second bill in November or December is the "settled" bill, where the town adjusts for the new rate the NH Department of Revenue Administration sets every fall. If the rate went up, you pay more in December. If it went down, you pay less. The rate is never locked for more than a year.

One more thing the calculator on Zillow does not tell you. Your assessed value is not your purchase price. Towns in NH assess on their own schedule, and most of them run somewhere between 80 and 100 percent of current market value. The gap between what you paid and what the town thinks the house is worth is called the equalization ratio, and it matters more than the mill rate alone. More on that below.

Why the rate swings so much town to town

You drive ten minutes from Salem to Derry and the rate climbs almost eight dollars per thousand. That is not a mistake. That is the NH funding model working exactly as designed.

NH has no income tax and no sales tax. That is the headline every relocator loves, and it is real. But the state still has to pay for public schools, and it has decided that most of that cost falls on the towns, through property tax. If a town has a big commercial base, like Salem with Tuscan Village and the Rockingham Park corridor, the commercial properties carry a large share of the bill and the residential rate comes in lower. If a town is mostly residential, like Derry, the homeowners carry the school budget almost alone and the rate climbs.

School spending per student matters too. Derry runs its own elementary and middle schools and sends high schoolers to Pinkerton Academy, which is a private academy with a public-tuition contract. That tuition line is significant. Windham runs its own K-12 system and has built new schools in the last fifteen years, which shows up in the debt-service line on the tax rate. Salem has a larger tax base to spread those costs across, so the same dollar of school spending costs a Salem homeowner less.

None of this is a criticism of any town. It is just the math, and it is why "NH is a low-tax state" deserves an asterisk the size of a front door.

Side by side, the three towns buyers compare most

Here is the 2025 picture for the three towns buyers compare most often, with annual tax bills at three common price points. These are based on 2025 rates published by the NH Department of Revenue Administration. Rates are set annually, so 2026 numbers will shift when the fall rate-setting cycle finishes.

Salem at a $17.06 rate: $8,530 on a $500K home, $12,795 on a $750K, $17,060 on a $1M. Windham at $19.83: $9,915 on a $500K, $14,872 on a $750K, $19,830 on a $1M. Derry at $24.74: $12,370 on a $500K, $18,555 on a $750K, $24,740 on a $1M.

Read across one row. A buyer choosing between a $750,000 colonial in Windham and the same house in Derry is looking at a $3,683 annual difference. Over ten years, that is $36,830 before any rate increases. That is a finished basement, a new roof, or two full years of college tuition. It is not a rounding error.

Read down one column. On the $1M line, the spread between Salem and Derry is $7,680 a year. Most buyers I walk through this do not know the gap is that wide until I put it on paper.

One caveat. These bills assume the town's assessed value matches the price you paid, which is rarely exactly true. Use the equalization section below to adjust.

Assessed value vs. what you paid

The sticker price is not what you are taxed on. The town's assessed value is.

Every NH town publishes an equalization ratio. It is the number the Department of Revenue Administration calculates to describe how close the town's assessments are to current market value. A ratio of 100 percent means the town is assessing at full market. A ratio of 80 percent means the town is assessing at 80 cents on the dollar, and your tax bill is lower than the sticker-price math would suggest.

Here is how it plays in practice. You buy a $750,000 colonial in Windham. The town's most recent assessed value on that property, from the last full revaluation, is $620,000. Your tax bill next June is calculated on the $620,000 figure, not the $750,000 you paid. At Windham's $19.83 rate, that is $12,295 a year, not $14,872.

That gap closes over time. NH law requires a town to do a full revaluation at least every five years, and most Southern NH towns are on a four or five year cycle. When the next revaluation hits, the assessor usually brings the number much closer to recent-sale prices, and your bill adjusts upward. Buyers who budget on the purchase-price math are usually over-budgeting in year one and right on the number by year three or four.

The town assessor's office posts every property's current assessed value online. Look it up before you write an offer. It is the single best ten-minute due-diligence step most buyers skip.

Elderly, veteran, and other exemptions

NH gives real exemptions for seniors, veterans, and a handful of other categories. They reduce your assessed value directly, so the dollar savings scale with the mill rate. The bigger your town's rate, the more the exemption is worth.

Elderly exemption. Every town sets its own amount and income limits. In Salem, a qualifying homeowner age 65 to 74 can get $98,000 off assessed value, 75 to 79 gets $145,000 off, and 80-plus gets $195,000 off. Income and asset limits apply, and they are not trivial. Windham and Derry run similar tier structures with different dollar amounts. On a Derry home, a $195,000 exemption at the $24.74 rate saves $4,824 a year. That is the kind of number that changes a downsizing decision.

Veteran credit. NH offers a standard veteran credit of $500 off the tax bill itself, not the assessed value. Towns can vote to raise it. A 100 percent service-connected disabled veteran gets a much larger credit, typically $2,000 to $4,000 depending on the town. Gold Star spouses qualify for the disabled-veteran tier in most towns.

Other categories. Blind exemption, deaf or hearing-impaired exemption, and solar/wind/wood-heating exemptions exist in most towns. The dollar values are smaller than the elderly or veteran credits but they stack.

You apply at the town's assessing office by April 15 for the current tax year. The application is simple, the paperwork requirements are not, and the return on the hour it takes to fill out is often thousands of dollars a year. If you are buying into a town and you qualify, file the day you close.

For downsizers weighing Salem against Derry for a single-level condo or a smaller home, run the exemption math both ways before you decide. The lower sticker price in Derry sometimes wins back more through the elderly exemption than the higher mill rate takes away. Sometimes it does not. The only way to know is the actual math on the actual house.

What buyers get wrong

The most common mistake I see on the buyer side is assuming the purchase price and the assessed value are the same number. They almost never are, and that mistake usually runs in the buyer's favor for the first year or two of ownership. Use the town's current assessed value to budget year one, then assume a revaluation jump within three or four years.

The second mistake is comparing NH to MA on the rate alone. NH's mill rates look enormous next to MA's. Most MA towns run between $10 and $15 per thousand. But MA also has a state income tax of 5 percent, a sales tax of 6.25 percent, and an "income surtax" on high earners. A MA-to-NH relocator who does the full tax picture, not just the property line, almost always comes out ahead in NH. For the full math on that, the moving from Massachusetts to Southern NH honest guide breaks it down on a real household budget.

The third mistake is thinking the NH tax advantage holds when you still work in MA. It does not. The commuter tax trap explains why MA will still tax your wages if you cross the border for work, and what to do about it.

When to appeal an assessment

If the town's assessment looks high compared to recent sales of similar homes on your street, you can appeal. You have until March 1 of the tax year to file an abatement request. The process is not mysterious, but it does reward homeowners who bring evidence.

The evidence that wins an appeal is a pile of recent comparable sales, usually three to five, that sold for less than your assessment implies your home is worth. The town's assessor is looking at the same MLS data, but they are looking at it through a mass-appraisal model, not a property-by-property review. If your home has a feature the model cannot see, a wet basement, a failing septic, a weird lot shape, an aging roof, that is your opening.

You can pull comps yourself from the town's assessing office or ask an agent who knows the street. I do abatement-comp pulls for past clients on request. If the numbers support an appeal, you file. If they do not, I tell you so, and you save the filing fee.

A successful appeal saves you money every year going forward, not just this year. On a Derry home where the assessment drops by $50,000, that is $1,237 a year back in your pocket, every year, until the next revaluation. Worth an afternoon.

If you want to compare specific towns side by side with current listings, the neighborhoods page has the price bands and tax math worked out for each one.