Midtown Direct NJ Property Tax Benchmark (2026): Millburn/Short Hills, Summit, Montclair, Chatham & Madison
Compare 2026 property tax rates across NJ Transit’s Midtown Direct rail corridor: Summit (1.62%), Chatham (1.68%), Madison (1.72%), Short Hills/Millburn (1.84%), and Montclair (2.58%).
By Pablo Cirre Gómez and East Corp Capital Quantitative Desk
Along NJ Transit’s Morris & Essex and Montclair-Boonton Midtown Direct rail lines—the 32-to-48-minute one-seat commuter corridor into New York Penn Station—homebuyers often assume every train town carries the same 2.5% New Jersey property tax burden. In reality, crossing a county line by a single train stop from Essex County (Montclair, Maplewood, South Orange) into Union County (Summit) or Morris County (Chatham, Madison) cuts the effective property tax rate from 2.58% down to 1.62%–1.69%, saving $13,350 to $14,400 every year on a $1.5 million home.
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Why County Lines (Essex vs. Union vs. Morris) Drive a $14,000 Annual Tax Gap
Every New Jersey property tax bill is divided into three slices: the School District Levy (~55%–62%), the Municipal Levy (~22%–26%), and the County Levy (~12%–20%). Because Essex County includes the regional hospital, judicial, and social infrastructure of Newark, Essex County’s county-level tax rate is nearly double that of neighboring Morris County. That is why Chatham and Madison in Morris County maintain effective rates near 1.68%–1.72%, while Montclair, Glen Ridge, South Orange, and Maplewood in Essex County sit between 2.48% and 2.68%.
The sole outlier inside Essex County is Millburn Township (Short Hills): because The Mall at Short Hills is one of the highest-grossing luxury retail centers per square foot in North America, its commercial property tax payments subsidize Millburn’s residential tax roll—holding Short Hills’ effective tax rate down near 1.84% despite funding one of New Jersey’s top-ranked public school districts.
2026 Town-by-Town & Jurisdiction Benchmark Table
| Municipality / Jurisdiction | 2026 Rate / Ratio | Effective Tax / Cost | Key Statutory & Commuter Note |
|---|---|---|---|
| Summit (Union County) | 1.58% – 1.66% | $24,300 / yr | 38 min Midtown Direct to NY Penn; Overlook Medical & Celgene/BMS base |
| Chatham Borough / Twp (Morris) | 1.64% – 1.72% | $25,200 / yr | Low Morris County tax rate (0.25%) vs. Essex County (0.48%) |
| Madison (Morris County) | 1.68% – 1.76% | $25,800 / yr | Drew/Fairleigh Dickinson university town; municipal electric utility |
| Millburn / Short Hills (Essex) | 1.78% – 1.88% | $27,600 / yr | The Mall at Short Hills commercial ratable offsets Essex County levy |
| Westfield (Union County) | 2.02% – 2.14% | $31,200 / yr | Raritan Valley Line + NYC Express bus; vibrant walkable downtown |
| Montclair / South Orange / Maplewood | 2.48% – 2.68% | $38,700 / yr | Essex County levy + urban-suburban municipal services |
How a $14,000 Annual Tax Difference Changes Your Maximum Mortgage Buying Power
At a 6.44% 30-year fixed mortgage rate, every $1,150 per month ($13,800/year) saved in property tax escrow between Montclair (2.58%) and Summit (1.62%) or Chatham (1.68%) supports an additional $183,000 of mortgage principal for the exact same monthly PITI payment. That is why houses in Summit, Short Hills, and Chatham trade at a structural price-per-square-foot premium: buyers capitalize the lower perpetual property tax stream directly into the home price.
Frequently Asked Questions & Statutory Rules (2026)
Why are property taxes in Short Hills (Millburn) so much lower than in neighboring Maplewood or South Orange?
Both Millburn/Short Hills and Maplewood/South Orange sit in Essex County, but Millburn Township collects tens of millions of dollars in commercial property taxes from The Mall at Short Hills and Route 24 office parks, reducing the residential share of the school and municipal budget.
Does Madison NJ have lower utility bills in addition to lower Morris County property taxes?
Yes. Madison Borough owns and operates its own municipal electric utility alongside a low 1.72% effective property tax rate, providing residents with lower kWh electricity rates and rapid local storm restoration.
How does a municipal-wide revaluation in Montclair or Maplewood affect my property tax bill?
A municipal revaluation brings all properties back to 100% of current market value. If your home appreciated faster than the town average since the last revaluation, your tax share rises; if it appreciated slower than the town average, your tax bill can actually decrease even as your assessed value jumps.
Can I deduct Summit or Short Hills property taxes on my New Jersey state tax return?
Yes. New Jersey allows homeowners to deduct up to $15,000 of local property taxes paid from their New Jersey gross income on Form NJ-1040, even when the federal $10,000 SALT cap limits their federal Schedule A deduction.