Increase in Property Tax Bills

[Justin Carter]

Is anyone that invests in Detroit and Warren, MI also experiencing a significant increase in their taxable values? 

Granted, I acquired 2 properties in these markets in 2024 and so I am aware that a sale will prompt a re-assessment, but I am a bit surprised to see the assessment values nearly double, which will result in a significant increase in my tax liability. Hard to cash flow when your tax bill doubles!   

Curious if anyone else has experienced the same thing and if they'd have any luck with the appeal process? 

[Travis Biziorek]

I've heard a lot of complaints about it this year. For a baseline, I own 12-doors in Detroit but I also have a couple hundred clients I've helped buy rentals there over the last couple years.

Everyone seems to be complaining about higher property taxes. The reality is, you should be pulling the current SEV for any new acquisition and doing your property tax calculations based on that figure before buying. I do this for every single client.

But even that is not bulletproof and I've seen new adjustments going 5-10% higher than that.

You can appeal property tax assessments, and I've done so with a lot of success in the past. But it's best if you have done some significant rehab to the property (at least that's my experience. 

All that said, you shouldn't be seeing anything close to a 2x in expected property taxes unless you completely fumbled the ball on pulling the current SEV before purchase.

A lot of people do their numbers based on what the current owner is paying or what Zillow shows. This is a huge mistake, and it's where most people get into trouble.