Dayton apartment property taxes are set by Montgomery County applying Ohio’s uniform formula: the auditor estimates market value, taxes 35% of it, and applies the effective millage for the parcel’s taxing district. For a building with four or more units, that effective rate is the higher Class 2 rate, which in the Dayton City School District was about 97.63 mills for tax year 2025. The county completed a full reappraisal in 2026, and the new values reach bills paid in 2027, so this is a year when owners should understand each step of the calculation.
Dayton is an incorporated city, first incorporated in 1805, and the county seat of Montgomery County. The 2020 Census counted 137,644 residents, and the Census Bureau’s July 1, 2025 estimate is 136,688. According to the Census Bureau’s QuickFacts profile of Dayton, 48.4% of occupied homes are owner-occupied, so a slight majority of households rent, and the median gross rent in the 2020–2024 American Community Survey was $918 a month. With rents at that level, property tax is often one of the largest single expenses on an apartment operating statement.
How Ohio turns market value into taxable value
Every Ohio parcel goes through the same basic steps:
- The county auditor estimates the property’s true or market value.
- Taxable, or assessed, value is 35% of that market value, under Ohio Administrative Code rule 5703-25-05.
- The gross tax rate is the total of all voted and unvoted levies in the parcel’s taxing district, expressed in mills (one mill is $1 of tax per $1,000 of taxable value).
- Tax reduction factors under House Bill 920 lower the gross rate to an effective rate, with separate factors for two classes of property.
- Any credits, abatements and special assessments are applied to produce the final bill.
The step that matters most for apartment owners is the fourth one, because the class a property falls into determines which effective rate applies.
The six-year cycle and the 2026 reappraisal
Ohio law requires each county to reappraise all real property once every six years, with an update in the third year after each reappraisal. That rule is in Ohio Revised Code section 5715.33. In Montgomery County, 2020 was the last full reappraisal, 2023 was the triennial update and 2026 is the next full reappraisal.
What 2023 told owners
The 2023 update was the largest increase in the county’s history. Montgomery County reported that total value rose by $8.5 billion, with residential values up 34% and commercial values up 12% in aggregate. Many Dayton apartment owners saw those changes on bills paid in 2024.
What 2026 shows so far
According to the county’s 2026 Property Reappraisal page and its reappraisal FAQ, the new values take effect for tax year 2026 and first appear on bills paid in 2027. Local reporting on the county’s results, from WKEF and the Register-Herald, put the countywide increase at about 19% for residential property and about 20% for commercial property, with total county value rising about $7 billion to roughly $46 billion. The county also cautioned that commercial value changes “are expected to vary significantly by property use (apartments, retail, office space, etc.)” and are based on comparable sales nearby.
Those are averages. An individual apartment building’s change depends on its own sales comparables and condition. The county held an informal review period from mid-July through August 2026, and the formal appeal window opens again in January.
Estimating your 2027 bill
A rough estimate of a building’s 2027 tax bill starts with the new 2026 appraised value on the auditor’s record. Multiply it by 35% to get taxable value, then apply the effective Class 2 rate for the parcel’s district. Because the reduction factors for tax year 2026 will be recalculated after the reappraisal, the tax year 2025 effective rate is only a starting point. It will tend to overstate the increase for voted levies, while inside millage and any new levies approved by voters can push the other way. Budgeting with the old rate and then adjusting when the county publishes new rates is a reasonable, conservative approach.
Why four or more units means Class 2
Ohio classifies each parcel by its principal current use under ORC 5713.041: Class 1 is residential and agricultural property, and Class 2 is everything else. This classification exists to apply the HB 920 reduction factors.
The state’s land use code rule puts apartments with four to 19 units (code 401), 20 to 39 units (code 402) and 40 or more units (code 403) inside the 400-series range for taxable commercial real property. One-, two- and three-family dwellings carry residential codes 510, 520 and 530. In practice, a Dayton fourplex or larger apartment building is taxed at the Class 2 effective rate, while a duplex or triplex is taxed at the Class 1 rate.
The triplex and fourplex line
The class boundary creates a sharp difference between buildings that may look almost identical from the street. Using the tax year 2025 Dayton City School District rates discussed below, a triplex appraised at $400,000 would have a taxable value of $140,000 and pay about $9,015 a year at the Class 1 rate. A fourplex with the same appraisal would pay about $13,668 at the Class 2 rate, roughly $4,650 more. Owners comparing small multifamily buildings, or deciding whether to convert a triplex into a fourplex, should run both numbers before assuming the extra unit pays for itself.
Dayton apartment property taxes by the numbers
The Montgomery County Auditor publishes effective rates for each taxing district. The tax year 2025 rate sheet, for taxes payable in 2026, shows the following for the City of Dayton and Dayton City School District (district R72):
- Gross rate: 112.27 mills.
- Class 1 reduction factor 0.426459, for an effective rate of 64.39 mills.
- Class 2 reduction factor 0.130433, for an effective rate of 97.63 mills.
Parts of Dayton that fall in the Vandalia-Butler City School District have different rates: 120.15 gross mills, 79.59 effective for Class 1 and 98.66 for Class 2. Owners should check the district code on their parcel record rather than assuming the main Dayton rate applies.
A worked example
For a Dayton apartment building appraised at $1,000,000:
- Taxable value: 35% of $1,000,000 is $350,000.
- Annual tax at 97.63 effective mills: $350,000 times 0.09763 is about $34,171.
- The same value at the Class 1 rate of 64.39 mills would be about $22,537.
That gap of about $11,600 a year is why the class matters. It is also why a 20% increase in appraised value can be painful for apartment owners: on this example, it would add about $6,800 a year before any change in rates. That is our arithmetic on the published rates, not a county figure.
Why Class 2 rates move differently
HB 920 reduction factors are designed to keep voted levies from collecting more money simply because values rise. When a reappraisal increases values, the reduction factors generally deepen and effective rates fall, so tax bills rise by less than values do. Because Class 1 and Class 2 have separate factors, the two classes can move very differently after a reappraisal. In the 2025 figures above, the Class 2 effective rate is much closer to the gross rate than the Class 1 rate is, which largely reflects how much faster Class 1 values have risen over time.
Credits that apartments do not receive
Two well-known Ohio credits rarely help apartment owners.
The nonbusiness credit under ORC 319.302 applies to residential property, which the statute defines to include one-, two- and three-family dwellings, even when they are leased. Buildings with four or more units never qualified. The credit itself is being phased down under House Bill 186.
The owner-occupancy credit under ORC 323.152 applies only to an approved homestead, the owner’s own residence. Rental units do not receive it. At most, an owner who lives in one unit of a small building might qualify for part of the property.
Both credits also apply only to “qualifying levies,” generally levies approved before September 29, 2013, plus inside millage and certain renewals. That limit dates to the 2013 state budget and has been narrowed again more recently.
The 2025–2026 Ohio property tax package
At the end of 2025, Ohio enacted a package of property tax bills that took effect in March 2026. According to a summary by the law firm Vorys and the Ohio House’s own announcement, the main pieces are:
- House Bill 186 created an Inflation Cap Credit that limits growth in school district taxes at the 20-mill floor to the rate of inflation. It applies to both Class 1 and Class 2 property, so apartment buildings benefit.
- House Bill 335 caps the growth of inside millage in reappraisal and update years at three years of inflation, with relief beginning in January 2027. That timing lines up with the 2026 reappraisal.
- House Bill 129 counts emergency, substitute and similar levies toward the 20-mill floor.
- House Bill 124 requires the state to use the county auditor’s sample of arm’s-length sales from the prior three years when setting values.
- House Bill 309 gives county budget commissions more authority to reduce levies.
These changes apply across property classes. They do not change the 35% assessment ratio or the Class 2 status of apartments, but they can slow the growth of tax bills after the 2026 values take effect.
Appealing a value at the Board of Revision
Owners who disagree with a value can file a complaint with the Montgomery County Board of Revision between January 1 and March 31. For apartment buildings, appeals usually rest on rent rolls, operating statements, comparable sales and evidence of condition. For many Dayton apartment property taxes, the January 2027 filing window will be the first chance to formally challenge the new 2026 values.
What a strong apartment appeal includes
Because apartment buildings are income properties, the most persuasive evidence usually ties value to income. A well-prepared complaint typically includes:
- A current rent roll showing each unit’s rent, lease dates and vacancies.
- Trailing 12-month operating statements with actual expenses, not projections.
- Evidence of deferred maintenance or capital needs, such as contractor bids or inspection reports.
- Recent arm’s-length sales of comparable Dayton apartment buildings, adjusted for size, age and condition.
- The purchase contract and closing statement, if the building sold recently.
A recent arm’s-length purchase price is often the strongest single piece of evidence, in either direction, which is why buyers should expect their price to shape the next value.
School board challenges after House Bill 126
Apartment buyers in Ohio have historically faced value challenges from school boards after large sales. House Bill 126, enacted in 2022 and now part of ORC 5715.19, narrowed those challenges. A school board may file a counter-complaint only when the owner’s complaint seeks a change of at least $17,500 in taxable value, and it must do so within 30 days. A school board’s original complaint requires a resolution adopted at a public meeting and notice to the owner. School boards that do not own the property also lost the right to appeal to the Board of Tax Appeals.
Transfer costs, due dates and city income tax
Conveyance fee
When a Dayton property sells, Montgomery County charges a real property conveyance fee of $3 per $1,000 of the sale price plus $0.50 per parcel. On a $1,000,000 sale, that is $3,000.50. Sellers usually pay this at closing, although the purchase contract governs. Buyers should also confirm on the treasurer’s records that no delinquent taxes or special assessments remain on the parcel, because unpaid real estate taxes stay with the property rather than the seller.
Payment due dates
For tax year 2025 bills payable in 2026, the county set the first-half due date as February 13, 2026 and the second-half due date as July 24, 2026. Unpaid first-half taxes carry a 10% penalty. Owners whose taxes are paid through a lender escrow should still check that both halves were paid on time.
City income tax on rental income
Dayton levies a 2.5% municipal income tax, in effect since January 1, 2017, and the city states that it applies to rental income. It is not a property tax, but it affects after-tax returns from a Dayton building and should be part of any owner’s budget.
Abatements and the new-construction comparison
Dayton uses Community Reinvestment Area (CRA) abatements to encourage residential investment. Minutes from the City Commission’s October 21, 2026 meeting report 18 new residential CRA projects valued at approximately $1.4 million. Abated projects pay tax on a reduced value for the abatement period, so a new or rehabilitated building nearby may carry a much lower tax bill than an older, fully taxed building with similar rents. Buyers comparing operating statements should note which properties are abated and when the abatements expire.
What this means for Dayton apartment owners
A few practical steps follow from the rules above:
- Confirm your parcel’s land use code and taxing district on the auditor’s record. Class and district drive the effective rate.
- Re-estimate taxes for 2027 using the new 2026 appraised value and the latest effective Class 2 rate, rather than last year’s bill.
- If the new value looks high relative to your income and comparable sales, prepare a Board of Revision complaint for the January 1 to March 31, 2027 window.
- After a purchase, expect the price to influence the next value, and budget taxes on the purchase price rather than the seller’s old bill.
- Track the HB 186 and HB 335 caps, which may slow the growth of future bills.
For a state-by-state view of how Ohio’s approach compares with other markets, see our guide to rent control and property tax by state. Our Ohio market overview covers other cities in the state, and our page on selling an apartment building in Dayton explains how we evaluate local buildings, including their tax history.
