Arkansas Caps Your Assessment at Twice a Homeowner's Rate
Program and regulatory figures verified September 15, 2026. Details change; confirm your scenario with us.
Arkansas has a reputation as a low-tax state and the reputation is broadly fair. It is less fair to an investor than to a homeowner, and the gap is written into the constitution rather than into a county practice.
Two caps, and you get the weaker one
Amendment 79 limits how fast an assessment can rise after a county reappraisal. The limit depends on who lives in the property.
| Property | Annual cap after reappraisal |
|---|---|
| Owner-occupied homestead | 5% |
| Non-homestead, including your rental | 10% |
| Utility and carrier real property | 10% |
Ark. Const. amend. 79, sections 1(b) and 1(c). Read 2026-09-22.
The credit you will not receive
Section 3 of the same amendment directs an annual state credit against ad valorem property tax on a homestead, of not less than $300, applying to taxes due from calendar year 2001 onward and capped at the taxes actually owed. It is a homestead credit. A property you rent out does not get it.
A renovation resets the base
Worth knowing before a value-add deal. Neither cap applies to newly discovered real property, new construction, or substantial improvements. Improve a property meaningfully and the protection restarts from the new assessed value rather than shielding the increase you just created.
What this page deliberately does not tell you
An effective tax rate. Amendment 79 sets the caps, not the assessment ratio, and we have not read the ratio and county millage at a primary source. Publishing a percentage we have not verified would be worse than publishing nothing, so we run the actual county bill when we underwrite rather than a state average. That is part of how we quote a file.
Official sources for Arkansas investors
Figures and rules on this page trace to the agencies and codes below. Arkansas programs and assessment rules change, so confirm current figures at the source before you rely on one.
- Arkansas Development Finance Authority
- Arkansas Department of Finance and Administration
- Arkansas Code (General Assembly)
- Fannie Mae Selling Guide
- Freddie Mac Seller/Servicer Guide
- Consumer Financial Protection Bureau
Frequently asked questions
What is the property tax assessment cap on an Arkansas rental?
10% a year on the first post-reappraisal increase, and by a further 10% in each year after, under Arkansas Constitution Amendment 79 section 1(b). An owner-occupied homestead is capped at 5% under section 1(c), so an investor's assessment can climb at twice a homeowner's rate on an identical property.
Does a renovation affect the Amendment 79 cap?
Yes. Neither the 10% nor the 5% cap applies to newly discovered real property, new construction, or substantial improvements to real property. Improve a property meaningfully and the protection restarts from the new assessed value rather than shielding the increase you created, which is worth modelling before a value-add purchase.
What is the effective property tax rate in Arkansas?
We do not publish one. Amendment 79 sets the assessment caps rather than the assessment ratio, and we have not read the ratio and county millage at a primary source, so any percentage we quoted would be unverified. We run the actual county bill when we underwrite a file rather than applying a state average.
Mike Certo · NMLS #260555 · Cornerstone First Mortgage NMLS #173855 · Equal Housing Lender. Educational content, not a loan commitment and not legal or tax advice. County assessments, millage and reappraisal cycles change, and the figures here carry the date we verified them. Confirm current requirements with the county assessor, your CPA, or an Arkansas real estate attorney before you buy. Loans are subject to buyer and property qualification.