2026 Cape Cod Property Tax Rates: A Town-by-Town Breakdown & The Policy Shifts Affecting Your Wallet

The release of Fiscal Year (FY) 2026 property tax rates presents a complex financial picture for owners in the Lower and Outer Cape towns. This annual analysis is of vital interest to current homeowners concerned about their tax bills and the policies impacting residency, and potential buyers who are assessing the true cost of ownership and evaluating affordability in the Cape’s highly competitive market.

While the official tax rate per $1,000 of assessed value has dropped in most towns, this trend must be balanced against continually soaring property valuations. The result is a critical juncture where policy decisions—particularly the Residential Tax Exemption (RTE) and the Luxury Transfer Fee—will redefine who bears the burden of municipal funding in this increasingly high-value, high-demand region.

Here is a comprehensive look at the 2026 tax rates and the policy discussions that will shape the Cape Cod tax landscape for years to come.

2026 Cape Cod Property Tax Rates by Town

Across the Cape Cod towns, a general decline in the tax rate is visible, largely driven by the strong real estate market which allows towns to meet budget requirements with a smaller levy per dollar of assessed value.

Policy Spotlight: The Residential Exemption and Tax Shift

The Residential Tax Exemption (RTE) is a crucial policy on the Outer Cape, designed to reduce the taxable value of properties owned and occupied by year-round residents, shifting the burden onto non-resident owners (primarily second homeowners).

Chatham: A Game-Changer for FY 2027

While not yet reflected in the FY 2026 rates, Chatham’s Select Board voted in August 2025 to implement a significant 35% Residential Exemption beginning in Fiscal Year 2027.

• How it Works: The exemption will deduct a fixed amount ($551,277, based on the average assessed value of $1,575,077) from the taxable value of an eligible year-round home.

  
  

• The Impact: This move is intended to provide critical relief to year-round residents battling the town's high cost of living. Assessors estimate that the average year-round homeowner will save over $1,300 per year, while the tax rate for all residential properties (including second homes) will increase to compensate for the reduction in the overall tax base.

Eastham and Wellfleet: Established RTE Towns

• Eastham and Wellfleet are among the Cape communities that already utilize the RTE to support year-round residency. For owners in these towns, it is crucial to file applications annually by the deadline (typically April 1) to ensure the exemption is reflected on their bill.

Brewster, Harwich, and Orleans: The Ongoing Debate

• Brewster's Hold: For FY 2026, the Brewster Select Board opted against adopting the RTE, citing that the town’s property values are not as stratified as in other communities. The "break-even point"—the value above which a resident would pay more in taxes—was deemed too low to provide broad, equitable relief, though the discussion remains open for future years.

• Orleans' Analysis: Orleans is actively studying the RTE, with local reports suggesting a high break-even point, which would ensure the vast majority of year-round residents see a tax benefit.

Critical News: The Push for a Luxury Real Estate Transfer Fee

Across the Lower and Outer Cape, the housing crisis remains the paramount concern. In response, regional leaders and activists are championing state legislation to allow towns to implement a Luxury Real Estate Transfer Fee.

• The Proposal: This fee, typically proposed at 1% to 2% on the sale price above a set threshold (e.g., over $1 million or $2 million), would be paid at the time of closing.

• Local Relevance: High-value towns like Chatham, Orleans, and Wellfleet would be the primary beneficiaries, as the revenue is dedicated solely to local affordable and workforce housing funds.

• The Goal: Advocates, including County leaders and local Select Board members, view this as the only scalable and sustainable mechanism to fund year-round housing solutions without overburdening the annual property tax levy. Given that towns like Wellfleet have already filed Home Rule Petitions to adopt the fee, this remains one of the most significant pieces of legislation to watch in 2026.

Actionable Insight for Owners and Buyers

For property owners and potential buyers in the Lower and Outer Cape, the 2026 tax landscape emphasizes the following actions:

1. Review Your Assessment (Homeowners): With towns like Harwich completing their FY 2026 Revaluation, owners should review their new property assessment against comparable sales data during the public disclosure period.

2. Evaluate Long-Term Cost (Buyers): A town's lower tax rate does not mean a lower tax bill. Factor in high property values when calculating long-term carrying costs using the formula:

   $1,000Assessed Property Value​×Tax Rate=Annual Property Tax

3. Check for Exemptions (Homeowners): If you are a year-round resident, particularly seniors, investigate the Residential Tax Exemption status and other valuable programs. Towns like Dennis and Harwich offer specific Senior Exemptions and Work-Off Programs that can significantly reduce your tax burden.

   
   

By staying informed about both the rates and the policy shifts, property owners on the Lower and Outer Cape can navigate the region's evolving financial landscape effectively.

Navigating Cape Cod Bliss: Final Thoughts

The 2026 property tax rates for the Lower and Outer Cape highlight a clear trend: the conversation is shifting from simple rates to complex policy and valuation. For current homeowners, the key is engaging with local exemptions; for potential buyers, the focus must be on factoring rising assessments into the long-term cost of ownership.

Don't navigate the nuances of the Chatham Residential Exemption, the Orleans tax debate, or the complexities of the transfer fee alone. As your local Cape Cod resource, I am here to provide the hyperlocal insight you need to make smart, informed real estate decisions, ensuring your slice of Cape Cod bliss is secure.

Ready to discuss how these rates impact your personal buying or selling strategy?

Sarah Keith | Realtor® at Cape Cod Bliss brokered by eXp Realty Phone: 508-237-4745 | Email: sarah@capecodbliss.com

Office Address: 60 Munson Meeting Way, Unit J, Chatham, MA 02633

Licensed in Massachusetts: License # 9557311

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We are an Equal Housing Opportunity brokerage. Information deemed reliable but not guaranteed.

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