MI · #10 by population

Buying a home in Michigan

Costs and rules that are specific to Michigan. Main city: Detroit.

In short

Michigan taxes property sales through its state real estate transfer tax, does not require an attorney at closing and requires a seller disclosure form. It allows both court and out-of-court foreclosure and is not a community property state.

Calculate for Michigan

If you buy

Michigan transfer taxes

State real estate transfer tax (MCL 207.522 to 207.526): $3.75 per $500 of value or fraction of $500. Change the price: the amount is recalculated instantly.

Price$254,200
State transfer tax ($3.75 per $500)$1,908.75
County transfer tax ($0.55 per $500)$279.95
Total transfer tax$2,188.70
Share of the price0.86% of the price
Who paysThe seller

Default price: the Michigan median value of owner-occupied homes, $254,200 (Census ACS 2024). Rule: Divide the value by $500, round up to the next whole unit, multiply by $3.75. Value is fair market value of the real property only, if personal property is stated separately. This is the state share only; the county tax is added separately. The county transfer tax is imposed by law in every county, at 55 cents per $500 in a county under 2,000,000 people (MCL 207.502 and 207.504); a county of 2,000,000 or more may set up to 75 cents, and Wayne County, the most populous, charges 55 cents (Register of Deeds). Source: MCL 207.502 and 207.504 (legislature.mi.gov) and the Wayne County Register of Deeds Document Recording page, read October 15, 2026. Who pays: Both the state and county acts make the seller or grantor liable; a buyer may pay on the seller's behalf by agreement. Not included: other local transfer taxes, recording fees, title insurance and lender charges. Michigan transfer tax guide · all 50 states.

If you sell

Capital gain and the federal tax on it

Same federal rule in every state: Section 121 of the Internal Revenue Code excludes up to $250,000 of gain on a main home ($500,000 for a married couple filing jointly).

Capital gain$350,000
Section 121 exclusion$250,000 (limit $250,000)
Taxable gain$100,000
Type of gainLong-term (owned over 1 year), 15% chosen
Federal tax on the gain$15,000

Section 121 excludes $250,000; the rest is taxable.

Gain = sale price minus your adjusted basis (purchase price, buying costs and improvements); selling expenses reduce it (IRS Publication 523). Long-term rates for sales in 2026, by taxable income including the gain (IRS Rev. Proc. 2025-32, section 4.03): 0% up to $49,450 single or $98,900 married filing jointly, 15% up to $545,500 single or $613,700 jointly, 20% above. Not included: Michigan state income tax on the gain (not computed), the net investment income tax, depreciation recapture on a rental or home office, and the reduced exclusion for an early sale. Agent commissions are negotiated and never set by law. Capital gains on a home sale.

Michigan in short

Is there a real estate transfer tax in Michigan?

Michigan has a state transfer tax of $3.75 per $500 of value and a county transfer tax of $0.55 per $500 in counties under 2,000,000 people. Wayne County lists the combined rate as $8.60 per $1,000. By law the seller owes both.

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How much is the transfer tax on a $254,200 home in Michigan?

On $254,200, the median value of owner-occupied homes in Michigan (Census ACS 2024), the transfer taxes come to $2,188.70: $1,908.75 of state tax at $3.75 per $500, $279.95 of county transfer tax ($0.55 per $500). The county transfer tax is imposed by law in every county, at 55 cents per $500 in a county under 2,000,000 people (MCL 207.502 and 207.504); a county of 2,000,000 or more may set up to 75 cents, and Wayne County, the most populous, charges 55 cents (Register of Deeds).

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What closing costs does Michigan law set?

Michigan has no official typical closing-cost total. In Wayne County the seller owes transfer tax of $8.60 per $1,000 of value ($1,720 on $200,000) and recording a deed costs $30 per document.

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How is property tax calculated in Michigan?

Michigan assesses property at 50% of true cash value and caps yearly growth in taxable value at the lesser of inflation or 5% (2.7% for 2026) until the home is sold, and the principal residence exemption removes 18 mills of school operating tax.

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What is the deadline to appeal a property tax assessment in Michigan?

In Michigan, protest your assessment first at the March Board of Review, which meets starting the second Monday in March, then, for residential property, file a petition with the Michigan Tax Tribunal by July 31 of the tax year (MCL 205.735a).

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Do you need a real estate attorney to close in Michigan?

The Michigan statutes read do not require an attorney to buy or sell a home. Only a person licensed in Michigan may practice law (MCL 600.916) and a recorded deed must name its drafter (MCL 565.201).

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What must a home seller disclose in Michigan?

A Michigan seller of 1 to 4 residential units must give the buyer a signed disclosure form before the buyer signs a binding purchase agreement (Seller Disclosure Act, MCL 565.954). If it arrives later, the buyer may cancel within 72 hours in person or 120 hours by registered mail.

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How does foreclosure work in Michigan?

Most Michigan foreclosures happen out of court, by advertisement: notice is published for 4 successive weeks and the home is sold at a public sheriff's sale. For most homes with 1 to 4 units the borrower then has a 6-month redemption period.

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What first-time home buyer programs does Michigan offer?

In Michigan, the City of Detroit's Down Payment Assistance Program offers up to $25,000 for down payment, prepaids and closing costs to households below 80% of area median income ($83,850 for a household of four). The Michigan State Housing Development Authority (MSHDA) runs the state's homebuyer education network.

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How much tax when you sell a home in Michigan?

The federal rule is the same in Michigan as in every state: if you owned and lived in the home as your main home for at least 2 of the last 5 years, the first $250,000 of gain is excluded, $500,000 for a married couple filing jointly (Section 121, IRS Publication 523). Bought $400,000, sold $750,000: a single owner has $100,000 of taxable gain, $15,000 of federal tax at the 15% long-term rate; a couple filing jointly owes nothing. Michigan income tax on the gain is not computed here.

Capital gains on a home sale

Michigan guides

Detroit

Buying a home in Detroit, Michigan

Professionals in Michigan

All states · Federal guides