Michigan Property Taxes

By Andrew McManamonMichigan Property Taxes October 15, 2025

You’ve found a Michigan home you love. The price feels right, the location’s perfect… but then you scroll down and see the property taxes — and suddenly, things don’t look so clear anymore.

If you’re scratching your head wondering how those numbers are calculated (and why they seem to double when you buy the home), you’re not alone. Property taxes in Michigan can be tricky, especially with terms like “SEV,” “taxable value,” and “uncapping” floating around.

I’m Andrew McManamon, a Michigan Realtor who’s helped buyers all over the state — from Livingston County to Washtenaw — understand how taxes actually work here before signing on the dotted line. So, let’s break this down in plain English, with real Michigan examples and a few calculations you can actually use.

What Are Property Taxes in Michigan?

Property taxes are the price you pay for community services — schools, police, fire departments, libraries, parks, and even the plows that dig you out after one of those “Pure Michigan” snowstorms.

They’re what’s called an “ad valorem” tax, which simply means the amount you pay is based on the value of your property.

Unlike income or sales tax, property taxes are tied to your home’s value and are collected by your local government — not the state.

When Are Property Taxes Paid in Michigan?

Michigan homeowners receive two tax bills each year:

Summer Taxes: Mailed around July 1, due by September 14 (without penalty).
Winter Taxes: Mailed around December 1, due by February 14 (without penalty).

Summer bills tend to be much higher, mainly because they include school operating taxes and public service funding that local governments rely on during the warmer months for construction, education, and road work.

What Are Michigan Property Taxes Used For?

Michigan property taxes fund nearly everything that keeps your local community running smoothly. Depending on where you live, your tax dollars may go toward:

Public schools and community colleges
Police, fire, and EMS services
Street maintenance and snow removal
Libraries, parks, and recreation programs
County and township administration

So, while writing that check never feels fun, those dollars go right back into keeping your neighborhood functioning and safe.

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How Are Michigan Property Taxes Calculated?

Here’s where most homebuyers get confused — because your Michigan tax bill isn’t based on what you paid for your home.

Let’s look at the three key values that appear on your property tax statement:

Assessed Value (AV) – About half your home’s estimated market value, determined by your local assessor.
State Equalized Value (SEV) – The AV adjusted by the county and state to ensure consistency across Michigan.
Taxable Value (TV) – The number that actually determines how much you owe in property taxes.

🧾 Step 1: The Assessed Value

Each year, your local assessor estimates what your home would sell for on the open market, then divides that number in half to get your assessed value.

Example:

If your home’s market value is $400,000, the assessed value is roughly $200,000.

This number isn’t set in stone — it’s based on recent comparable home sales in your area, so if your neighborhood’s values jump, so will your assessed value.

🧮 Step 2: The Taxable Value

Your taxable value is the amount your local government uses to calculate your actual property tax bill.

It starts out equal to your assessed value the year you buy your home, but going forward it’s capped — meaning it can only increase by the rate of inflation or 5%, whichever is lower.

That’s why long-time homeowners often have much lower property tax bills than new buyers in the same neighborhood.

⚠️ When Property Taxes “Uncap”

Here’s the kicker — whenever a Michigan home sells, its taxable value “uncaps.”

That means the taxable value resets to equal the current assessed value, which is usually based on today’s much higher home prices.

So if the previous owner’s taxable value was based on the $90,000 they paid 25 years ago, and you’re buying it for $325,000, expect a significant jump in your next tax bill.

Michigan Millage Rates (and How to Calculate Your Property Taxes)

Your local millage rate determines how much tax you’ll actually pay.

1 mill = $1 per $1,000 of taxable value

To estimate your annual property taxes, multiply your taxable value by your local millage rate, then divide by 1,000.

Example:

Let’s say your taxable value is $100,000, and your township’s millage rate is 20.

$100,000 × 20 ÷ 1,000 = $2,000 in annual property taxes

You can find your exact millage rate on your property tax bill or through your city, township, or county assessor’s website.

👉 Here's a link to the Michigan Millage Rates

Estimating Property Taxes When Buying a Home

Here’s where homebuyers often make costly mistakes — they use the seller’s current tax bill to estimate their own.

Don’t do that.

Because once the property transfers to you, it uncaps — meaning the taxable value resets, and the taxes will be based on your purchase price, not theirs.

When you’re running numbers before buying a Michigan home, use these two methods for a realistic estimate:

🔹 The Low Estimate

Take the current taxable value (from the seller’s property record) × local millage rate ÷ 1,000.

This gives you a conservative estimate — but remember, it will almost always be lower than what you’ll actually pay once the home uncaps.

🔹 The High Estimate (More Accurate for Buyers)

Take 50% of the purchase price or list price (whichever is higher) × local millage rate ÷ 1,000.

This uses the same formula assessors use when determining a new taxable value after a sale and provides a more realistic projection of what your first year’s property taxes will be.

Michigan Property Tax Exemptions You Should Know

Principal Residence Exemption (PRE)

If the home you’re buying will be your primary residence, you can apply for the Principal Residence Exemption (PRE), which removes up to 18 mills of school operating tax from your bill.

To qualify, you must:

Own and occupy the property as your main home
Be a Michigan resident

This exemption can save you hundreds to thousands per year, depending on your local school district.

Senior and Veteran Tax Credits

Michigan also offers property tax relief programs for:

Seniors (65+) – Through the Homestead Property Tax Credit
Disabled Veterans – Full property tax exemptions in many cases

Check with your county treasurer or assessor to see if you qualify.

Where to Find Your Property Tax Information

You can estimate, review, or pay your taxes through the Michigan Department of Treasury’s Property Tax Estimator:

👉 Michigan Property Tax Estimator

You’ll need:

Your city/township and county
School district code
Estimated purchase price or current taxable value

If you need help finding this info, your Realtor or local assessor can guide you step-by-step.

Frequently Asked Questions About Michigan Property Taxes

1. How often do you pay property taxes in Michigan?

Twice per year — summer and winter.

2. When do property taxes “uncap”?

They uncap when a home is sold or transferred, resetting the taxable value to match the new market value.

3. What is the average property tax rate in Michigan?

The average effective rate is around 1.54%, though it varies by county. Oakland, Washtenaw, and Wayne are on the higher side, while Livingston and Lenawee are more moderate.

4. How can I calculate my Michigan property taxes?

Multiply your taxable value (or 50% of purchase price for a new buyer) × millage rate ÷ 1,000.

5. How can I lower my Michigan property taxes?

File for the Principal Residence Exemption, appeal your assessed value if it seems too high, or review available senior/veteran credits.

6. Can my property taxes increase after buying a home?

Yes — when the property “uncaps,” your taxes will likely jump since they’ll be recalculated based on your purchase price.

7. Are Michigan property taxes higher than other states?

Michigan’s property tax rates are slightly above the national average, but because home prices are much lower here, overall tax bills are typically more affordable.

8. What if I don’t pay my property taxes?

Unpaid taxes can lead to interest, penalties, and eventually foreclosure by the county treasurer after three years of delinquency.

9. How do I find my local millage rate?

Visit your city or township assessor’s website — most list their current millage rates and even include online tax calculators.

10. Do mortgage lenders handle property tax payments?

Most lenders collect taxes through your escrow account and pay them on your behalf to ensure they’re never missed.

Final Thoughts

Michigan property taxes may not be the most thrilling part of homeownership, but understanding how they’re calculated can help you budget smarter and avoid surprises at closing.

If you’re planning to buy, sell, or relocate within Michigan and need help estimating your taxes or understanding uncapping, reach out anytime. I help people move to, from, and within the state of Michigan — and I love it.