Michigan's property tax is based on:

Market value is what a property would sell for in an open market, but Michigan specifically uses taxable value for property tax calculations. While market value may influence taxable value over time, they are not the same basis for taxation.

Purchase price is only relevant for a one-time calculation when a property is transferred and is not the ongoing basis for property taxes in Michigan. Taxable value adjusts annually based on the cap, not the original purchase price.

Square footage is one factor considered in determining a property's value but is not the basis for calculating property taxes in Michigan. Taxable value considers multiple factors including location, size, condition, and comparable sales.