Apartment Property Tax Reassessment Calculator

Short answer

In many states a sale resets a building's assessed value toward the purchase price, so the buyer's property tax can be far higher than the seller's. This calculator estimates post-sale tax from price, effective tax rate and assessment ratio, compares it to the current bill, and shows the hit to NOI. Lenders underwrite the reassessed tax, not the seller's.

Why the seller's tax bill misleads buyers

The property tax on the seller's T-12 reflects the seller's assessed value, which may be years old. In many states, your purchase gives the assessor a fresh, public market value, and the assessment moves toward your price. On a long-held building the jump can be the single largest change between the seller's NOI and yours.

Lenders know this. On an acquisition loan the underwriter typically replaces the seller's tax line with an estimate based on the purchase price, then sizes the loan on that lower NOI. This tool lets you run the same estimate before you set your offer.

Property tax after a sale

Purchase price ($)Current annual tax ($)Assessment ratio (% of market value)The share of market value your jurisdiction taxes. 100 if the rate below is already an effective rate.Tax rate (% of assessed value)Cap rate, to show the value effect (%)Loan rate, to show the loan effect (%)Min DSCR (x)

Tax after the sale–

Increase–

Effect on value–

Effect on loan size–

Estimates only, not a loan quote.

How to use it

Purchase price. Your contract price, or the price you are about to offer. Run a few prices if you are still negotiating.
Current tax. The seller's most recent annual property tax bill. Get it from the county treasurer or tax collector's website, not from the offering memorandum, which may show an estimate or a partial year.
Effective tax rate. Total annual tax as a percent of market value. The cleanest way to find it is to look up the tax bill and assessed value of a few apartment buildings that sold recently in the same taxing jurisdiction, then divide tax by sale price. Your county's published millage or levy rate is applied to assessed value, which is not always market value, so it needs the assessment ratio below.
Assessment ratio. The share of market value the assessor actually assesses. Some states assess at full value; others apply a fixed fraction by property class, and some assessors run below their target in practice. Your county assessor's website usually states the ratio. If you entered an effective rate based on market value, leave this at 100%.

Worked example

Say you are buying a building for $6,000,000. The seller's current annual tax bill is $70,000. Recent sales in the same jurisdiction suggest an effective tax rate of 1.8% of market value.

Reassessment example	Amount
Current tax	$70,000
Tax at 1.8% of the price	$108,000
Increase	$38,000
Effect on value at a 6.0% cap rate	-$633,333
Effect on loan size at 1.25x DSCR	-$411,444

The gap between the seller's bill and the estimate is NOI that disappears the day you close. Every dollar of added tax is a dollar less of NOI, so it lowers the loan a lender will size at its minimum DSCR and lowers the value a buyer will pay at the same cap rate later. If your offer was built on the seller's tax line, this is the line to fix first.

The increase may not land in full right away. Depending on your state, the new value can show up on the next assessment roll, at the next scheduled reappraisal, or only after a taxing district appeals. Lenders generally underwrite the reassessed number regardless of timing.

How states handle a sale

Rules vary widely. The table covers states where we verified the rule against the state's own statute, rule or tax agency. For any other state, ask your county assessor and a local tax attorney.

State	Does a sale trigger reassessment?	The rule
California	Yes	A purchase or other change in ownership sets a new base year at full cash value. Between changes, the base year value can rise by no more than 2% a year (BOE Rule 460).
Florida	Yes	For all levies other than school district levies, non-homestead residential property is assessed at just value as of January 1 after a change of ownership or control, which includes a cumulative transfer of more than 50% of the owning entity. Otherwise annual increases for those levies are capped at 10%. Buildings of nine or fewer units fall under s. 193.1554; larger buildings under s. 193.1555.
Michigan	Yes	Taxable value grows by the lesser of 5% or inflation each year, but in the year after a transfer of ownership it resets to the state equalized valuation (MCL 211.27a).
Ohio	Often	The county auditor may treat the price of a recent arm's-length sale as the property's true value (ORC 5713.03).
Pennsylvania	Not by itself	County assessment offices are barred from spot reassessment of individual properties. A change resulting from an appeal by a taxing district, such as a school district, is not a spot reassessment (53 Pa.C.S. 8843).
Texas	No	Appraisal districts appraise property at market value as of January 1 every year (Texas Comptroller), so a sale is not a separate trigger, though your price is evidence of value. A temporary 20% annual cap on some non-homestead property valued at $5 million or less, authorized for the 2024 through 2026 tax years, ends when the owner changes (Harris Central Appraisal District).

Two patterns are worth knowing. In cap states like California, Florida and Michigan, a sale is exactly what removes the cap, so long-held buildings see the biggest jumps. In states without a sale trigger, the risk shifts to the next countywide reappraisal or to a taxing district appeal, and your recorded price becomes evidence in either one.

What this tool assumes

The full purchase price is assessable real property. If part of the price is furniture, equipment or other personal property, the real property value may be lower; that allocation is a question for your tax advisor.
One effective rate applies to the whole value. Special districts, bonds and assessments can add charges that do not scale the same way.
The reassessment lands in full. Phase-ins, caps that restart after the reset, and the timing of the next roll are not modeled.
No exemptions or abatements. Affordable housing exemptions, tax abatement programs and PILOT agreements change the answer and need their own review.
This is an estimate, not tax advice. Confirm with the county assessor and a property tax attorney or consultant before you rely on it.

What to do next

Replace the tax line in your underwriting with the estimate, then rerun the deal. The T-12 underwriting calculator shows what the higher tax does to lender NOI, and the DSCR sensitivity grid shows how much loan you lose. For a renovation deal, carry the new tax into the value-add loan calculator.

If the deal still works, use "get quotes on these numbers" to send the scenario to us, or email desk@janover.co. Lenders will ask how you estimated taxes, so keep the comparable tax bills you used.

Frequently asked questions

Will my property taxes go up when I buy an apartment building?

Often, yes, especially if the seller owned the building for a long time. In states such as California, Florida and Michigan, a sale is a statutory trigger that removes an assessment cap and resets value to market. In other states the assessor may use your sale price at the next reappraisal or after an appeal. Check your state's rule and estimate taxes on your price, not the seller's.

Do lenders underwrite the seller's property taxes or mine?

On a purchase, lenders typically underwrite an estimate of the tax you will pay after the sale, which in many jurisdictions is based on your purchase price. That estimate often exceeds the seller's actual bill. Because the loan is sized on underwritten NOI, a higher tax estimate reduces the loan amount at the lender's minimum debt service coverage ratio. Ask your lender how it estimates reassessed taxes.

Does buying the LLC instead of the building avoid reassessment?

Not reliably. Florida's statute, for example, counts a cumulative transfer of control or of more than 50% of the owning entity as a change of ownership that triggers reassessment. Other states have their own entity-transfer rules. Structuring a purchase to avoid reassessment is a legal and tax question with real penalties for getting it wrong, so get advice from a property tax attorney before relying on it.

How do I find the effective property tax rate for a building?

Pull the tax bill and recent sale price for a few apartment buildings that sold in the same taxing jurisdiction in the last couple of years, and divide each annual tax by its sale price. The county treasurer or tax collector publishes bills, and the recorder or assessor publishes sales in many counties. Using several buildings smooths out one-off exemptions or appeals.

Can I appeal a reassessment after I buy?

Most states let owners appeal an assessment within a deadline after notices go out, and a property tax consultant or attorney can tell you whether an appeal is worth filing. Your own purchase price is usually strong evidence of market value, which can cut against you if the assessment is at or below it. Mark the appeal deadline as soon as you close.