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It’s November, which means it’s time for Oregon residents to get their property tax bills for the year. When I assist buyers in finding a house, they often notice property tax discrepancies in otherwise-comparable properties, which can sometimes be the differentiating factor in making a decision on a home. Since it’s the season for property taxes, I thought it might be helpful to pull back the curtain a little on how the tax assessor calculates property taxes.
If you are in Multnomah County, these two articles – delving into how the tax bill is calculated (HERE) and frequently asked questions (HERE) – have been illuminating for me in terms of parsing through some of the idiosyncrasies of the Multnomah County tax code. Clackamas County has this online PDF as a useful resource (HERE), while Washington County’s main site is HERE.
For all three counties, Oregon’s Measure 5 (passed in 1990) and Measure 50 (passed in 1997) have been the two main legislative apparatuses that have influenced the state tax code. Measure 5 caps property tax calculation for real market value by $15 for every $1000 the home is worth. Measure 50 established “maximum assessed value” by setting its baseline of a home’s 1995 real market value less 10% (for every home built before 1995) and capping increases for maximum assessed value at 3% per year. Homes newer than 1995 have their value calculated by the city assessor, using their formula, but retain the 3% increase. Please keep in mind the 3% cap does not include local bonds and initiatives that may be passed by voters.
There are exceptions for that 3% increase, and some of these are especially germane to buyers and sellers. These exceptions include:
- New construction or additions of more than $10,000 in a year or $25,000 over five years.
- Remodeling or rehabilitation for the same amounts as the above item.
- Partitions or rezoning.
- Discovery of omitted property (this is especially notable for buyers who may be thinking of purchasing a home with unpermitted work, as an appraisal can turn up omitted property).
- Disqualification from past exemptions.
I tried to streamline this as best I could, but the tax code does remain extremely hard to parse. If you have any questions or input, let me know, and hopefully we can discover the answers together!
