Why Do My Property Taxes Go Up When the Market Is Flat?
It’s a fair question. Your Zillow estimate hasn’t moved in two years, and nearby sales aren’t getting more expensive with each sign in the yard…but your property tax bill keeps climbing. Here’s why.
Oregon’s property tax system is governed by two ballot measures most homeowners have never read.
Measure 5 (1990) capped the rate at which properties can be taxed — limiting education levies to $5 per $1,000 of real market value and general government levies to $10 per $1,000.
Measure 50 (1997) did something different. It rolled every property’s taxable assessed value back to 90% of its 1995–96 real market value, establishing a Maximum Assessed Value — and then capped how fast that assessed value can grow at 3% per year, regardless of what the actual market does.
Here’s where it gets interesting.
During the years Portland’s market was appreciating at 5–10% annually, your assessed value was only allowed to follow at 3%. The two numbers quietly diverged. Your home’s real market value ran ahead; your taxable assessed value trailed behind.
Now that the market has been essentially flat since 2023, you might expect your taxes to follow. They won’t, at least not yet. Your assessed value is still slowly catching up to where real market value was, not where it is today. That gap closes at 3% per year until it’s gone.
One more thing worth knowing: the 3% cap doesn’t include voter-approved measures. School bonds, library levies, transit measures…those sit outside the cap entirely. In any year your neighbors approved something at the ballot box, your bill can exceed 3% growth regardless of Measure 50.
A few other nuances:
If you’re buying a recently remodeled or flipped home, don’t assume you’re inheriting a low tax basis permanently. Significant improvements can trigger a reassessment. If the County catches an unpermitted remodel, the current owner can face one too. Buyers of updated homes sometimes discover their tax bill increases meaningfully in the first year of ownership.
The good news: Oregon doesn’t reset assessed value at sale. You inherit the seller’s existing assessed value and 3% cap (assuming none of the above exceptions), which, in older Portland neighborhoods where values once ran well ahead of assessments, can still be a meaningful advantage.
Just don’t expected the County to reward you at tax time if your home’s value decreases.
Frequently Asked Questions
Yes, you can. You'll have to demonstrate that the taxable value is too high. To accomplish this, you'll need to know the tax rate ("millage rate") for your home and look into the tax history. You may also want to look into what the tax bill looks like for similar homes near you. A good attorney or CPA can help.