By State Rep. Ann Bollin, R-Brighton Township
Published by Crain’s Detroit Business on May 11, 2026

For many families, buying a home is the biggest financial commitment they will ever make. It’s a milestone that represents stability, opportunity, and a place to build a future. Unfortunately, under Michigan’s current property tax system, too many new homeowners are hit with a surprise shortly after moving in: a sudden and dramatic tax increase known as the “pop-up tax.”

This hidden tax spike happens when a home changes ownership. Under Michigan law, a home’s taxable value can only increase each year by the rate of inflation or 5%, whichever is less. This cap protects homeowners from sharp tax increases while they remain in their home.

But the protection disappears the moment the property is sold.

When a home changes hands, the taxable value “uncaps” and resets to the property’s current state equalized value – essentially half of the home’s market value. The result is often a dramatic tax increase for the new homeowner.

Here’s what that looks like in practice.

Imagine a homeowner who has lived in their house for 20 years. Because of the cap, the home’s taxable value may have gradually grown to about $80,000 over that time.

Now the home sells for $300,000.

The following year, the taxable value immediately “pops up” to $150,000 – nearly double the previous taxable value. For the new owner, that means a major jump in property taxes almost overnight.

If the local tax rate is 40 mills, the previous homeowner would have been paying about $3,200 a year in property taxes. After the sale, the new homeowner would owe about $6,000 annually – an increase of roughly $233 per month added to their housing costs.

For families already stretching their budgets to afford a home, this surprise increase can be a serious financial burden.

This also can keep empty nesters and seniors from moving on. Many want to age in place, but they find a home designed for raising children doesn’t always accommodate the needs of seniors. For example, a house with bedrooms on the second floor can become increasingly difficult to navigate with age.

That’s why I’m introducing legislation to eliminate Michigan’s pop-up tax for owner-occupied homes. My plan would prevent taxable value from automatically jumping when a home is sold. Instead, the taxable value would remain consistent with the previous homeowner’s level and continue to grow gradually over time under the existing cap.

Importantly, homes will still sell at full market value under this plan, but buyers will no longer be penalized with a sudden tax spike simply for moving.

This reform would provide stability and predictability for new homeowners. Families would be able to better plan their budgets without worrying about a sudden tax spike the year after purchasing their home.

Just as importantly, eliminating the pop-up tax will help make homeownership more affordable at a time when many Michigan families are already facing rising everyday costs.

It’s also important to note that local governments and other taxing entities will continue to receive stable and predictable revenue. They already collect a set amount of property tax revenue each year and are guaranteed increases of up to the rate of inflation or 5%, whichever is lower. This plan does not reduce those revenues. It simply prevents large, one-time spikes that come at the expense of new homeowners.

To ensure this protection is permanent, my proposal is paired with a House Joint Resolution that would allow voters to place this reform directly into the Michigan Constitution. By doing so, we can provide long-term certainty for homeowners and ensure these protections cannot be easily changed through future changes to state law.

Michigan’s property tax system already recognizes that taxes should rise gradually and predictably. My proposal simply extends that same fairness to the next homeowner.

If we want to keep the dream of homeownership alive and well in Michigan, we must address policies that make it harder for families to afford a home.

Eliminating the pop-up tax is a commonsense step toward providing meaningful property tax relief and ensuring that purchasing a home does not come with an unexpected financial shock.