Oct 17, 2023 - News

Portland's confusing property taxes, explained

Effective property tax rate for a median-valued home, 2022
Data: Lincoln Institute of Land Policy; Note: Among the largest cities in each state, as well as Washington, D.C., Aurora, Ill. and Buffalo, N.Y.; Chart: Kavya Beheraj/Axios

Your property tax bill for this year is ready and should be in your mailbox soon.

  • Payment is due Nov. 15 — with discounts if you can swing at least two-thirds of the bill by then.

Why it matters: Property taxes make up roughly a third of Portland's budget, a quarter of Portland Public Schools', and about 15% of Multnomah County's, but arcane rules mean your bill could be very different from your neighbor's.

Driving the news: Portland ranked fifth highest nationally for effective property tax rate — a homeowner's tax bill as a percentage of a property's value — on a median-value home.

  • That's according to a recent report from the nonprofit Lincoln Institute of Land Policy and the Minnesota Center for Fiscal Excellence.

Zoom in: The report notes that differences in property values across cities mean that some cities with high tax rates can still have low tax bills on a median valued home — if they have low home values.

  • In 2022, Portland — where prices have been dropping but still trend comparatively high — had the highest tax bill on a median-value home, per the report, at 3.5 times the national average.

Flashback: Oregon saw big property tax limitations in the 1990s, first cutting rates almost in half by strictly limiting the rate that could be levied against a home's value, then moving away from an exclusively market-value based assessment.

The intrigue: Unlike in most cities, in Portland these limits don't reset when homes are sold. They're based instead on the age of the home.

  • The report found that effective tax rates on newly built homes in Portland are 40% more than those built before the tax limits that started in 1996.
  • Taking the limitations into account, Portland would drop to the 12th highest effective tax rate for median-value homes, the report says.

By the numbers: Two figures are the starting point for how much property tax you pay.

  • The "real market value" of your home — as determined by a county assessor. This is typically based on sales of similar homes.
  • "Maximum assessed value" is an Oregon-specific concept and can be lower than the market value. The maximum assessed value can't go up more than 3% each year, although there are exceptions, such as zoning changes or significant remodels.
  • Your tax is based on the lower of these two numbers.

Meanwhile, Multnomah County is divided into different tax rate zones. To see the rate you pay for different services — as well as your total overall rate — find the "code area" number on the first page of your bill, then look that up in the far left- or far right-hand column of this document.

  • Voters can add on extra property taxes for local services, such as schools or parks.

Be smart: Renters don't get billed directly for property taxes, but landlords could fold the expense into rent.

  • Want to find out the tax on the building where you live? Just plug in the address here and log on as a guest.
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