With a 4% top income tax rate and 0.83% property tax, Kentucky homeowners face a moderate combined tax burden. This calculator is pre-filled with Kentucky numbers: $205,000 median price, 0.83% property tax, $1,750/year insurance.
Last updated: March 13, 2026
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Monthly Payment (Kentucky)$0
Loan Details — Kentucky
Kentucky median: $205,000
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Below 20% triggers PMI on conventional loans
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Average 30-year fixed ~6.75% (March 2026)
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Kentucky average: 0.83%
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Kentucky average: $1,750/yr
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Principal & Interest
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Property Tax
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Kentucky Metro Area Home Prices
Click a metro to load its median price into the calculator above.
Yearly Amortization Schedule+
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Kentucky's Tax Landscape and Your Mortgage
Kentucky levies a flat 4% income tax on all taxable income. A household earning $150,000 pays approximately $4,500 in state income tax, which reduces the amount available for monthly mortgage payments by roughly $375/month.
At the state's median home price of $205,000, the $0.83% property tax rate adds $142/month to your mortgage payment. That's $1,702/year — below the national median of ~1.1%.
Property Taxes Across Kentucky
The 0.83% statewide average masks significant variation. Property tax rates in Kentucky vary by county and school district. Check your specific jurisdiction for exact rates.
Price ranges across the state: Louisville has a median of $250,000, while Bowling Green sits at $230,000 — a $20,000 gap that dramatically changes your monthly payment. At $0.83% property tax, that price difference alone means $14/month more in property tax in Louisville.
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Homebuyer Programs and Exemptions
Kentucky offers several programs for homebuyers:
KHC Conventional Preferred Plus with down payment assistance
Affordable DAP with up to 6% assistance
Homestead exemption: Homestead exemption of $46,350 (2025) for seniors 65+ and disabled persons
Kentucky-Specific Considerations
Flat 4% income tax rate (reduced from 5% in 2023)
Relatively affordable housing market
Some cities and counties levy local occupational/income taxes (1-2.5%)
Louisville and Lexington have additional local taxes that affect take-home pay
Compare Kentucky Mortgage Rates
See personalized rates from Kentucky lenders. LendingTree matches you with up to 5 offers so you can compare and save.
0.39% property tax, 5% top rate. Median home: $232,500.
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1.04% property tax, no income tax. Median home: $340,000.
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0.62% property tax, 2.5% top rate. Median home: $395,000.
Frequently Asked Questions
What is the average property tax rate in Kentucky?
The average effective property tax rate in Kentucky is 0.83%. On a $205,000 home (the state median), that works out to approximately $1,702/year or $142/month added to your mortgage payment. Property tax rates vary by county and school district within Kentucky — always check your specific jurisdiction's rate. Homestead exemption: Homestead exemption of $46,350 (2025) for seniors 65+ and disabled persons
How much does homeowners insurance cost in Kentucky?
The average annual homeowners insurance premium in Kentucky is approximately $1,750 ($146/month). This is near the national average of approximately $1,500/year. Actual premiums depend on your home's location, age, construction type, and coverage limits.
What first-time homebuyer programs are available in Kentucky?
KHC Conventional Preferred Plus with down payment assistance. Affordable DAP with up to 6% assistance. These programs typically have income limits, purchase price caps, and may require homebuyer education courses. Check the Kentucky housing finance agency website for current eligibility requirements and application deadlines.
How does Kentucky's 4% income tax affect home affordability?
Kentucky's top income tax rate of 4% reduces your take-home pay, which affects how much mortgage you can comfortably carry. On a $150,000 salary, state income tax takes roughly $3,900-$5,100/year (effective rate is lower than the top marginal rate). Combined with 0.83% property tax, the total tax burden in Kentucky is above average. Use our paycheck calculator to see your exact take-home pay.
What is the conforming loan limit in Kentucky?
The 2026 conforming loan limit in Kentucky is $806,500. Loans above this amount are considered jumbo loans and typically carry higher interest rates (0.25-0.5% premium), require larger down payments (10-20%), and have stricter qualification requirements including higher credit scores (700+) and lower debt-to-income ratios.
This calculator is for educational purposes. Tax rates and insurance costs are based on Kentucky state averages and may not reflect your specific county, school district, or municipality. Consult a financial professional for advice specific to your situation.