Michigan Property Taxes | Top 10 Places In Michigan With The HIGHEST Property Taxes - So you’re thinking about making the move to southeast Michigan, but a concern of yours are the property taxes (as it should be), and when you look at other online resources, it doesn’t really give you the answer you’re looking for. So with that being said, be sure to stick around, because I’m going to chat about how property taxes in Michigan are structured, and tackle the top 10 worst cities in southeast Michigan with the WORST property taxes.

This blog is a direct transcript from the video below. This comes in 3 versions: You are able to watch the video, read the blog for your convenience or listen to the audio experience (which is linked under the video below).

Disclaimer

I am not a tax professional, assessor, or attorney. This article is for general informational purposes only. Always consult a licensed tax professional, financial advisor, or local assessor’s office for guidance specific to your situation.

Michigan Property Taxes Explained: Why Rates Vary and What Homebuyers Should Know

Property taxes are one of the most significant recurring costs of homeownership, not just in Michigan, but nationwide. They fund essential community services—public safety, road maintenance, local government operations, libraries, parks, and more—so they naturally play a major role in deciding where to live.

Many people relocating to Michigan ask why property taxes feel high here, and whether they’re truly as burdensome as rumored. The reality is more nuanced, and Michigan’s tax system has evolved dramatically over the last several decades.

Below is a clear, SEO-optimized breakdown of how Michigan property taxes work, why they vary so widely from city to city, and what changes shaped the system we have today.

Michigan’s Property Tax Burden Has Shifted Over Time

Historically, Michigan’s property tax burden was above the national average—especially in the 1970s. However, over time, this changed significantly. By 2018, Michigan had dropped below the national average in terms of property tax burden relative to income.

Even so, property taxes remain a major source of funding for Michigan municipalities, and therefore continue to impact residents year after year.

While residents understandably feel the weight of this expense, local governments rely on these funds to provide services and infrastructure upkeep. Property taxes and community services go hand-in-hand—it's nearly impossible to reduce one without affecting the other.

How Michigan Compares Nationally

Different organizations rank states differently depending on methodology and data year:

• In 2020, Michigan’s effective property tax rate was around 1.44% of a home’s value.
• In some rankings, Michigan appears 13th highest; in others, around 38th.
• New Jersey typically appears highest, while states like Hawaii appear lowest.

This variation simply reflects differences in how each source defines “effective tax burden,” not a contradiction.

How Proposal A Changed Michigan Property Taxes

One of the most important changes in Michigan tax history occurred in 1994 with the adoption of Proposal A.

Before Proposal A:

• Property taxes fluctuated with market value.
• Homeowners often saw dramatic tax increases as market conditions changed.
• Schools relied heavily on local property taxes for funding.

Proposal A created a new structure that fundamentally reshaped the system:

1. Taxable Value Growth Became Capped

Taxable value can increase only by:

• Rate of inflation, or
• 5%, whichever is lower

…unless the property transfers ownership.

This is why a seller might have extremely low taxes while the new buyer’s tax bill resets significantly higher.

For example:

• A buyer who paid $75,000 twenty years ago may have a low taxable value due to capped growth.
• If the home sells today for $300,000, the taxable value “uncaps” and resets to reflect the new market value.

This is why Zillow tax estimates are almost always incorrect—and why buyers should confirm tax calculations with a lender or assessor.

2. School Funding Shifted

Proposal A reduced reliance on local taxes and increased state-level funding for schools.
While this reduced local tax burden, it increased certain statewide taxes to compensate.

What the Data Shows About Michigan's Tax Trends

Analysis of Michigan property tax data from 1978 through 2018 reveals several key insights:

1. Michigan’s Tax Burden Has Stabilized

Despite Proposal A's limitations, overall tax burden relative to income has remained relatively stable.

2. Michigan Property Taxes Contribute Less to Government Funding Compared to the National Average

This means Michigan homeowners are not carrying a disproportionately heavy share relative to other states.

3. Average Tax Rates Have Increased Gradually

Charts from the Michigan Department of Treasury show a slow upward climb in average tax rates from 1995 to 2020, reflecting inflation, community needs, and increased service costs.

Understanding Key Terms: Taxable Value vs. Market Value vs. SEV

Before diving into which cities have the highest property taxes, it’s important to define three terms that confuse most homebuyers:

Market Value

What the home would likely sell for in the current real estate market.

State Equalized Value (SEV)

Typically 50% of the home’s estimated market value, but not always accurate.
SEV is based on sales studies over past years and should not be used to determine listing price or market worth.

Taxable Value

The number used to calculate property taxes.
Taxable value is capped each year by Proposal A until the property transfers ownership.

Understanding these terms prevents major surprises when buying a home in Michigan.

How Property Taxes Are Calculated in Michigan

Michigan uses a formula based on millage rates (local tax rates) multiplied by the taxable value of the home.

Example structure:

Millage rates vary dramatically from city to city depending on local operating costs, debt millages, and voter-approved levies.

Cities in Southeast Michigan With the Highest Property Taxes

Using 2019 Census data, here are the 10 Southeast Michigan cities with the highest millage rates at that time. (Note: Millage rates can change annually.)

#10 — Detroit

• Millage: 69.6
• Median Market Value: ~$45,000
• Median Tax Bill: ~$1,438

#9 — Eastpointe

• Millage: 69.8 (Eastpointe Schools) / 65.2 (South Lake Schools)
• Median Market Value: ~$69,100
• Median Tax Bill: ~$1,800

#8 — Royal Oak Township

• Millage: 77.4 / 73.6
• Median Market Value: ~$64,100
• Median Tax Bill: ~$1,371

#7 — Hazel Park

• Millage: 74.6
• Median Market Value: ~$61,100
• Median Tax Bill: ~$1,650

#6 — Center Line

• Millage: 77.2 / 65.3
• Median Market Value: ~$72,600
• Median Tax Bill: ~$2,300

#5 — Inkster

• Millage: 78.4 / 64.1
• Median Market Value: ~$47,000
• Median Tax Bill: ~$1,671

#4 — Highland Park

• Millage: 78.4
• Median Market Value: ~$33,700
• Median Tax Bill: ~$1,241

#3 — River Rouge

• Millage: 82

• Median Market Value: ~$34,000

• Median Tax Bill: ~$1,628

#2 — Harper Woods

• Millage: 83.1 / 81.9
• Median Market Value: ~$76,100
• Median Tax Bill: ~$2,610

#1 — Ecorse

• Millage: 111.5 / 111
• Median Market Value: ~$40,500
• Median Tax Bill: ~$1,488

Why High- and Low-Tax Cities Vary So Much

Property taxes vary based on:

• Local millage rates
• Home values
• School district levies
• Public safety budgets
• Infrastructure needs
• Approved ballot measures

Higher millages in areas with lower home values typically reflect the need to generate sufficient revenue to fund essential services.

This is why two neighboring cities can have drastically different tax bills.

Final Thoughts: What Michigan Homebuyers Should Keep in Mind

Property taxes are one of the most important numbers to review when buying a home in Michigan. Now that you understand how taxable value works, how millage rates differ, and which cities have higher tax burdens, you can make more informed decisions when choosing where to live.

If you're planning a move to Michigan or need help understanding tax rates in your target area, feel free to reach out anytime — I’m always happy to help you navigate the process.