When you buy a home in Michigan, your real estate taxes often increase significantly the year after purchase. That is because real estate taxes are based on the value and location of a home, but they are limited on how fast they can increase by the consumer price index.

The result is that the current owner usually pays less taxes than you will pay as a new owner because the value of their property increased faster than the consumer price index.

After you close on your home, the local assessor will see how much you paid for it and use that to adjust the assessed value and the taxable value. Typically, they are set to one-half the purchase price.

Your tax bill is then computed by multiplying the millage rate by the taxable value.

Here is a website that shows the millage rates in Michigan: https://www.michigan.gov/taxes/property/estimator/related/millage-rates

Here is a website that can provide an estimate of your new tax bill: https://www.michigan.gov/taxes/property/estimator