Memphis City Council Caps Residential Property Tax Assessments Starting 2027

The Memphis City Council passed an ordinance on July 8 that caps annual increases in residential property tax assessments at 3 percent for owner-occupied homes. The vote followed review of the city's 2026 property valuation data compiled by the Shelby County Assessor's Office. This change applies directly to the roughly 180,000 single-family residences inside city limits and takes effect with the 2027 tax bills mailed in December.

Why the timing aligns with current assessments

Property values in Memphis rose an average of 12 percent between 2024 and 2026 according to the county assessor's records. Without the cap, many households would have faced reassessments that pushed their tax liability higher. The ordinance states that the limit applies only to primary residences and excludes commercial and rental properties, which continue under standard valuation rules.

Memphis residents who own their homes will see their tax calculation based on the lower of the new assessed value or the prior year's value plus 3 percent. For a household whose home assessment would have jumped from $150,000 to $168,000, the new rule keeps the taxable base closer to $154,500. This adjustment flows into the combined city and county millage rate that funds police, fire, parks and schools.

Direct effects on monthly expenses

Local advocates note that property taxes represent the largest single line item in many Memphis household budgets after mortgage or rent. A stable assessment means predictable payments that residents can plan around when allocating money for groceries, utilities and transportation. Families in zip codes such as 38106 and 38109, where home values have increased sharply, stand to avoid the largest immediate shifts.

The legislation states that the cap will remain in place through the 2027 tax year, after which the council must vote again. City budget documents project that the measure will reduce expected property-tax revenue by an amount that will be offset through reserves rather than service cuts. Residents can apply for the homestead exemption online through the Shelby County Trustee's office before October 1 to confirm eligibility under the new rules.

City staff will begin recalculating notices in August and mail updated statements in the fall. Homeowners who believe their assessment still exceeds the cap can file an appeal with the county Board of Equalization by the September deadline listed on the notice.