Georges Ayoub and Cedric Goinard thought they knew what they were getting into when they bought a historic home in Indian Village in 2024.
Sure, it needed a lot of work: a new roof, a new sewer line, updated electrical and remediation from basement flooding. They were aware of those issues.
“We wanted to live in a beautiful neighborhood, in a historic house, and be part of the revival of the City of Detroit,” Ayoub said.
They weren’t prepared for the tax bill: $45,893.40. The eye-watering amount — far higher than they expected — put their plans in jeopardy. The couple believed the bill reflected an inflated assessment, but untangling that would take months.
“If we don’t get the tax reduced to something more reasonable, we’re going to have to sell the house right after buying it,” Goinard said of their thinking at the time. “Because we cannot afford it.”
In Michigan, annual property tax increases are capped until a home changes owners. Once it sells, taxes can jump sharply.
Those rules, and Detroit’s high tax rates, are not new. What is new is the city’s rising home values, which are making those tax jumps far more expensive. The biggest increases tend to hit higher-priced homes that haven’t changed hands in years. But buyers in lower-income neighborhoods across Detroit can face steep hikes, too.
“It is a big deal,” said Detroit Assessor Alvin Horhn. “Capping is a problem across the state. It’s exacerbated because the millage in Detroit is simply too high.”
An analysis of assessor data by Outlier Media found properties with larger projected tax increases sell less frequently. Real estate agents say they see the same pattern across Detroit: homes sitting on the market or seeing price reductions, if they sell at all. Buyers can also be caught off guard by the tax bills.
“This is a ticking time bomb that’s finally going off,” said Sami Abdallah, owner of Re/Max City Centre.
A problem everywhere
Mayor Mary Sheffield and her predecessor Mike Duggan have touted billions of dollars in rising property values in Detroit over the last decade. Sheffield said in a press release that these gains create “generational wealth that can change lives.”
But those same gains could make it harder for Detroiters to cash in on their investment.
Every year, the assessor calculates two values: assessed value (roughly half of market value) and taxable value (which determines the tax bill).
Proposal A, approved by Michigan voters in 1994, limits annual increases in a property’s taxable value to 5% or the inflation rate, whichever is lower. But assessed values are not capped; those values move with the market, and over time, can pull far ahead of the taxable value. After a sale, the taxable value resets close to the assessed value.
That cap benefits longtime homeowners. From 2017-25, Detroit’s total property value swelled from $2.8 billion to $10.1 billion — an increase of more than 261%. Detroiters who held onto their homes during that time saw their taxable value rise by just 27%.
But Proposal A is a double-edged sword: When a home sells, the taxable value can reset and sharply increase. That can discourage longtime owners from moving, because buying another home could mean losing their capped tax status and paying significantly higher property taxes. It also raises costs for the new owners.
At 32 years old, Proposal A “is showing its age,” said Jeff Guilfoyle, a senior strategist with Public Sector Consultants. “It’s not working as well anymore because those gaps between the taxable value and the assessed value for longtime owners have gotten to be huge.”
An Outlier Media analysis of the assessor’s 2026 tax roll found that Detroit homes would see an average increase of about $1,403 in property taxes if sold today.
Thousands of homes would see huge jumps. Even after eliminating outliers, 1,208 homes would see their estimated tax payments jump more than $10,000.
Detroit has some extreme examples:
- A Midtown home that hasn’t sold in decades would see a $50,783 tax increase.
- An Indian Village home that last sold in 2012 for $198,000 would see a $66,467 tax increase.
- A Palmer Woods home that last sold in 1997 for $900,000 would see a $66,829 tax increase.
Homes with the highest estimated tax increases largely sit in some of Detroit’s wealthiest neighborhoods: Indian Village, Sherwood Forest, Boston-Edison and Palmer Woods.
But the pattern plays out in every corner of the city.
From 2023-25, homes with smaller gaps between the assessed and taxable values sold more frequently — regardless of a home’s value. More than a third of homes with the lowest gap sold, while just 2.5% of the homes with the largest gap sold.
“It’s definitely affecting transactions. It’s slowing down sales, it’s stopping sales,” Abdallah said.
Homes in more modest neighborhoods, including Islandview, North End, Gratiot Town-Kettering and Chadsey Condon, had the widest gaps by percentage between assessed and taxable values.
Possible remedy
Sheffield said Detroit’s property taxes are too high.
In her first State of the City address, the mayor said she wanted to reduce property taxes 30%-60%. That could save Detroit homeowners thousands of dollars every year.
“It’s tough, but we have to get it done,” Sheffield said.
Sheffield hasn’t offered any concrete proposals yet, saying there is no “silver bullet.”
The city would likely lose tens of millions of dollars in revenue every year.
“We are going to continue to provide and combine a handful of options to significantly reduce property taxes while also minimizing the impact,” she said.
During her campaign, Sheffield floated ideas like increasing taxes on sales or ticketed events, and increased penalties for speculators and owners of blighted property.
Officials statewide are beginning to reckon with the issues around Proposal A as well.
“Momentum is building for some kind of property tax change or relief in Michigan,” said Tyler Marie Theile, vice president and chief operating officer of Anderson Economic Group. “And so then the question becomes: How do we achieve that and stay balanced?”
A lengthy process
Ayoub and Goinard, the homeowners in Indian Village, believed their house was overassessed.
They paid $560,000, but the assessor valued it at nearly $1.3 million.
“What’s the incentive for people to move here, knowing that you might be screwed with the tax you have to pay?” Goinard said.
The couple spent months trying to get the city to change the tax bill. First, they appealed to the Property Assessment Board of Review, which only slightly reduced their assessed value.
Ayoub and Goinard contacted city officials and sent documentation to the assessor’s office to no avail. Eventually, they showed up at Horhn’s office. He agreed to send an inspector to reassess the property. After finding errors, including incorrect square footage and an inflated condition rating, the city lowered their projected tax bill by nearly $30,000.
They said the whole ordeal required time and persistence.
“It was a very, very difficult process,” Goinard said, adding that the experience left them jaded.
“They are making us regret falling in love with the city,” Ayoub said.
The findings in this story came from an Outlier Media analysis of this year’s Tentative Assessment Roll, which provides tax information on every parcel in the city. Outlier used ChatGPT to generate a Python script for the analysis, which was reviewed by an outside coding expert. See our code here.
We first narrowed the dataset to taxable, residential properties without a neighborhood enterprise zone designation, because those parcels get a tax discount.
We then calculated the “uncapping ratio” — defined as the assessed value divided by the taxable value — and eliminated the top 1% of properties with the highest ratios. Some had uncapping ratios exceeding 1,000, and these extreme outliers were either not representative of the market at large or potentially wrongly assessed. After eliminating outliers, the largest uncapping ratio for any property was 13.54.
Next, we determined the estimated tax increase for every home as if they had a principal residence exemption. To do this, we multiplied a 0.67% millage rate by the assessed and taxable values, and calculated the difference between the two.
Eliminating outliers and applying an owner-occupied exemption to our analysis kept our findings conservative.
We then sorted properties based on their uncapping ratio into five equally sized quintile groups. Those with the lowest uncapping ratio were in the lowest 20%, and those with the highest were in the highest 20%.
We calculated the percentage of homes sold in each quintile group from Jan. 1, 2023 to Dec. 31, 2025. Here were the results:
| Uncapping quintile | % of properties sold |
|---|---|
| Lowest 20% | 36.96% |
| Low-mid | 5.27% |
| Middle | 3.02% |
| High-mid | 2.58% |
| Highest 20% | 2.49% |
This is an imperfect analysis. By definition, properties that sold recently are more likely to have a lower uncapping ratio, since their taxable value just reset to align with their assessed value. Additionally, the assessor’s data only includes the most recently recorded sale. A deeper analysis would require a dataset of all property transactions and the uncapping ratio at the time of the transactions.
Even so, these findings are consistent and align with anecdotal evidence we gathered from real estate experts.
Editor’s note: As a grantee of the American Journalism Project, Outlier Media receives in-kind access to ChatGPT Enterprise, which is developed by OpenAI.
