Written by: Mikki Silvey, Senior Tax Manager, Property Tax
When Assessments Hit, the Financial Impact Can Be Significant
Michigan sets property values every year, and each year stands on its own. While assessment notices may feel routine, 2026 values carry long-term consequences due to how taxable value increases are capped and carried forward over time.
When an assessment is successfully appealed and reduced, the taxable value basis is effectively reset, limiting future annual increases by the rate of inflation (or 5%, whichever is lower) until the property transfers or if there is a loss or addition. When owners do nothing, they continue paying taxes on a higher taxable value that compounds annually, meaning the same inflation rate is applied to a higher base―resulting in greater long-term tax liability.
What Michigan Property Owners Need to Know for 2026
In Michigan, there are three values associated with a parcel:
- True cash value-TCV (synonymous with fair market value)
- Assessed value-AV (50% of true cash value)
- Taxable value-TV (this is the value used to calculate taxes)
The taxable value is considered a capped value. This value can only increase annually by the rate of inflation or 5%, whichever is less, until the property transfers or if there is a loss or addition. While there can be nuances, the taxable value will generally increase at a slower rate than the assessed value; and over long-term ownership, the assessed and taxable values may have a substantial delta between the two.
The taxable value can never be higher than the assessed value. For example, the inflation rate calculated for the 2023 and 2024 tax years exceeded 5%. Therefore, the taxable value increase for those tax years maxed out at 5%. The 2025 taxable value increase was 3.1%, and the taxable value increase for the 2026 tax year is 2.7%.
Key Reassessment Facts
| VALUATION (LIEN) DATE | December 31, 2025 |
| TAX YEARS IMPACTED | 2026 |
| JURISDICTIONS AFFECTED | Statewide |
| ASSESSMENT NOTICES EXPECTED | February 2026 |
| APPEAL DEADLINES | June 1, 2026 Real property parcels classified commercial or industrial may be appealed directly to the Michigan Tax Tribunal (MTT) by the filing deadline of May 31, 2026 (extended to June 1, 2026, as May 31 falls on a Sunday). Personal property parcels classified commercial or industrial may be appealed directly to the MTT by May 31, 2026 (June 1, 2026) if a statement of assessable property was filed before the commencement of the 2026 March Board of Review. |
Where Property Owners Are Most at Risk of Overassessment in 2026
Because Michigan assessments are typically handled at a local level, risk is driven by jurisdiction-specific market assumptions and mass appraisal techniques. Owners should pay close attention to whether assessed values reflect current market realities, particularly following recent volatility in interest rates, operating costs, and vacancy patterns.
Valuations may be generated by mass appraisal models, which may not fully capture property-specific issues such as deferred maintenance, functional obsolescence, or localized market softness. Michigan is also a fee simple valuation state, meaning assessments typically rely on market rents, not contract rents―an important distinction from leased‑fee income approaches.
What This Means for Your Bottom Line
- Assessment reductions can provide long‑term benefit by resetting the taxable value growth base
- CPI‑driven taxable value increases were 5% in 2023–2024, 3.1% in 2025, and 2.7% in 2026
Valuation Trends by Property Type
| Property Type | Expected Trend | Notes |
|---|---|---|
| Office | ↓ | Office values continue to soften in most markets as elevated vacancy and shifting tenant demand weigh on income, increasing the risk that assessments rely on outdated assumptions. |
| Retail | → | Retail valuations remain relatively stable overall, with assessment risk varying by location, tenant mix, and the degree to which vacancy or rollover pressure affects property income. |
| Multifamily | → ↓ | Multifamily markets are cooling from peak pricing as new supply and concessions impact net operating income, creating potential gaps between assessed values and current performance. |
| Industrial | → | Industrial assets are generally stable, though assessment risk varies by market where rent growth is normalizing or property specific factors are not fully reflected in valuation models. |
| Hospitality | → | Hospitality valuations are highly property specific and driven by operating results, making reassessments particularly sensitive to changes in occupancy, rate, and overall performance. |
What You Do Next Matters
Early preparation matters in Michigan because reviewing values proactively allows owners to determine whether an appeal is warranted and whether potential savings justify the effort, given taxable value constraints.
DMA adds the most leverage early by modeling assessed vs. taxable value dynamics, evaluating market alignment, and outlining a defensible valuation position and appeal strategy to determine whether an appeal is warranted.
Why Michigan Property Owners Choose to Partner with DMA
DMA brings experience working within the local assessment environment, including familiarity with assessor practices, valuation methodologies, and the development and review of assessments. That perspective, along with established professional relationships in the field, helps DMA anticipate how valuation conclusions will be evaluated and how we can provide the strongest support for valuations.
DMA qualifies appeals before they are filed, so our clients only pursue cases with real, supportable upside. Our process starts by evaluating true market alignment and reconciling assessed versus taxable value dynamics, then building a defensible valuation position supported by market evidence. This process confirms whether an appeal is warranted before our clients invest time and resources.
DMA quantifies potential tax savings alongside risk and likelihood of success, so our clients’ decisions are economic rather than speculative. When an appeal is warranted, DMA builds a focused, well-structured case supported by clear valuation evidence. The result is a streamlined process that minimizes the effort required from our clients and keeps the focus on outcomes.
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We’ll compare your projected or actual assessment to market evidence and tell you whether an appeal makes sense.
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