Oregon Homestead Exemption: Creditor Protection, 3% Cap and Tax Deferral

Oregon has no general property-tax homestead exemption. Its homestead law, ORS 18.395, protects home equity from judgment creditors: $158,300 for one debtor from July 1, 2026 through June 30, 2027. Tax relief comes from other programs: the 3% cap on assessed value, a deferral for owners 62 and older or disabled, and targeted veteran and military exemptions.

In the property-tax chapter, the section titled “Homestead exemption” is ORS 307.286, which sits under “Active Duty Military Service.” It covers deployed members of the Guard, the reserves and other states’ organized militia, plus a lawful occupant of the home if the member died while serving (ORS 307.289(4)). Apart from the deferral and the veteran and military exemptions below, an owner-occupant’s tax is held down by two constitutional limits that apply to all property, owner-occupied or not: the cap on maximum assessed value in Article XI, section 11, and the limits on taxes per $1,000 of real market value in Article XI, section 11b.

ORS 18.395: what the homestead protects

Oregon Laws 2024, chapter 100 raised the base amounts. Under ORS 18.395(1)(a), a homestead is exempt “from sale on execution, from the lien of every judgment and from liability in any form for the debts of the owner to the amount in value of $150,000, except as otherwise provided by law.” Where two or more members of a household are judgment debtors, “their combined exemptions under this section shall not exceed $300,000.” The State Court Administrator re-indexes these each July 1 to the West Region CPI. The Oregon Judicial Department’s table shows these amounts:

A lower, unindexed cap applies to debts “arising out of a child support or spousal support obligation or a money award judgment that includes restitution.” For those debts the exemption is $40,000 per owner, with a $50,000 household ceiling (18.395(1)(b)). In a child-support case, the court may also refuse the exemption “in whole or part” after weighing the five factors listed in ORS 18.398(3). That discretion does not apply to proceedings brought by or for the state.

What counts, and for how long

• No filing. “The exemption is effective without the necessity of a claim thereof by the judgment debtor.”
• Occupancy. The home “must be the actual abode of and occupied by the owner, or the owner’s spouse, parent or child.” Temporary absence with intent to return does not end it. Removal, absence or sale keeps it alive for one year (18.395(3)).
• Sale proceeds. Proceeds are covered “if the proceeds are held for a period not exceeding one year and held with the intention to procure another homestead.”
• Land. Outside a town or city laid out in blocks and lots, the homestead is up to 160 acres. Inside one, it is up to one block. It can never exceed the dollar cap (ORS 18.402).
• Other property types. The exemption covers a buyer’s interest under a land sale contract, a floating home and a manufactured dwelling (18.395(9)–(10)).
• Small judgments. While the home is occupied by the debtor or the debtor’s spouse, dependent parent or dependent child, it “may not be sold on execution to satisfy a judgment that at the time of entry does not exceed $3,000.” The judgment still “remains a lien upon the real property,” and the home can be sold on execution at any time after the debtor sells it or after none of those people lives there (18.395(5)). A temporary absence with intent to return does not lift the bar. The bar does not apply when one creditor holds two or more judgments totaling more than $3,000 (18.395(7)).

Four kinds of claims fall outside the homestead rules altogether. ORS 18.406 says ORS 18.395 to 18.422 “do not apply to construction liens for work, labor or material done or furnished exclusively for the improvement of the homestead property, to purchase money liens, to mortgages lawfully executed, or to the enforcement of a seller’s rights under a land sale contract.”

When a creditor does force a sale, the sheriff pays the owner the exempt amount from the proceeds first. A bid that does not exceed the costs of sale plus the exemption cannot be accepted (18.395(8)). An owner who is selling can send judgment creditors a notice of intent to discharge the judgment lien under ORS 18.412. The creditor then has at least 14 days from mailing to object.

The constitutional 3% cap on maximum assessed value

This is not an exemption and needs no application. Voters adopted Article XI, section 11 of the Oregon Constitution on May 20, 1997. It provides that “For tax years beginning after July 1, 1997, the property’s maximum assessed value shall not increase by more than three percent from the previous tax year.” ORS 308.146 sets maximum assessed value at “103 percent of the property’s assessed value from the prior year or 100 percent of the property’s maximum assessed value from the prior year, whichever is greater.” A home’s assessed value is the lesser of its maximum assessed value and its real market value.

The cap is reset for new property or new improvements, partitioning or subdividing, rezoning with a consistent use, omitted property, loss of an exemption, partial exemption or special assessment, and lot line adjustments (ORS 308.146(3)). A sale is not on that list, so a sale by itself does not reset maximum assessed value.

Tax deferral for owners 62 and older or disabled

The deferral program under ORS 311.666 to 311.701 postpones the tax rather than reducing it. The Department of Revenue pays the county, records a lien, and charges interest “at the rate of six percent per annum” (ORS 311.674). Eligibility turns on several tests:

• Age or disability. You must be 62 or older “on or before April 15 of the calendar year in which the claim is filed,” or be a person with a disability as of that date (ORS 311.668).
• Income and net worth. Deferral is refused if prior-year household income is “$70,000 or more” or net worth is “$500,000 or more.” The section was last amended by Oregon Laws 2025, chapter 449, and the Department states that $70,000 is “The household income limit for 2026.” Indexing starts with tax years beginning on or after July 1, 2027.
• Time in the home. The home must have been your homestead “for at least five years preceding April 15.” Exceptions exist for health-related absence, for a surviving spouse or disabled heir, and for a move from a higher-value deferred home under the conditions in 311.670(2)(b).
• Title and insurance. You need fee simple title under a recorded instrument. Joint owners with survivorship rights must all live there and all apply. The home must be insured for fire and other casualty. If it is insurable but uninsured and meets every other test, the Department of Revenue may buy the insurance and add the cost to its lien (311.670(4)). No federal law, rule or regulation that governs a mortgage, trust deed, land sale contract or conditional sale contract secured by the home may prohibit the deferral (311.670(5)).
• Home value. Real market value must be below the greater of an indexed floor or a percentage of the county median real market value. The percentage depends on continuous ownership and occupancy as of April 15: 150% under 17 years, 160% for 17 to under 19, 170% for 19 to under 21, 200% for 21 to under 23, 225% for 23 to under 25, and 250% at 25 years or more (ORS 311.670(6)). The Department lists the 2026 floor as $301,000.
• Reverse mortgages. These are restricted under ORS 311.700.

The claim goes to the county assessor “after January 1 and on or before April 15” before the tax year (ORS 311.672). A late claim is accepted through December 1 with a fee of 10% of the last tax, within limits the Department sets at $20 to $180 for 2026. The number of new deferrals granted each year is capped (311.672(4)). Deferred taxes and interest become payable when the claimant dies (with joint claimants, when the survivor of them dies); when the home is sold, a contract to sell it is entered into, or anyone other than the claimant becomes the owner; when it is no longer the claimant’s homestead, unless the claimant must be away for health reasons; or when a deferred manufactured structure or floating home is moved out of the state (ORS 311.684). The ownership trigger yields to ORS 311.683 when the Department of Transportation acquires the home by condemnation, and a surviving spouse or disabled heir may continue the deferral under ORS 311.688. The program closes to new and continuing claims filed on or after December 2, 2032 (ORS 311.667).

Veterans and deployed service members

Disabled veterans and surviving spouses (ORS 307.250). The statute set bases of $15,000 and $18,000 of assessed value. Each year’s amount “shall equal 103 percent of the amount of the exemption for the prior tax year.” The Department of Revenue’s January 2026 publication 150-310-676 lists $27,092 and $32,512. The larger amount (base $18,000) is for a veteran certified by the VA or a service branch with service-connected disabilities of 40% or more. It also covers an unmarried surviving spouse, if the veteran died of a service-connected injury or illness or received at least one year of that maximum exemption after 1981. The smaller amount (base $15,000) is for anyone else in this list:

• a veteran certified by the VA or a service branch with disabilities of 40% or more;
• a veteran rated 40% or more by a physician whose prior-year gross income was “not more than 185 percent of federal poverty guidelines”; or
• an unmarried surviving spouse of a veteran.

File with the county assessor “on or before April 1 of the assessment year.” A home acquired after March 1 and before July 1 has 30 days after acquisition. A claim carries forward while ownership, use and eligibility stay the same, but a physician-certified veteran refiles every year (ORS 307.260). If that veteran received the exemption last year and has not refiled by April 1, the assessor sends a notice by April 10, and the veteran can still file by May 1 with a $10 late fee. Otherwise, “If the claim for any tax year is not filed within the time specified, the exemption may not be allowed on the assessment roll for that year.” A veteran whose VA or service-branch certification arrives late, rating the disability as of an earlier date, has six months from that notice to claim the earlier years, up to three tax years back (ORS 307.262).

Deployed Guard and reserve members (ORS 307.286). An Oregon resident serving in the Oregon National Guard, the military reserve forces, or the organized militia of another state or territory can exempt assessed value of a homestead while serving under Title 10 or an Emergency Management Assistance Compact deployment “For more than 178 consecutive days, if at least one of the days falls within the tax year for which the exemption is claimed.” The homestead is a home the member owns that “but for military service, would be occupied as a residence by the person.” A member who applies before service begins, with written orders for at least one day of service in that tax year, is allowed the exemption if otherwise eligible (ORS 307.289(3)). The base was up to $60,000, and each year’s amount “shall equal 103 percent of the amount of the exemption for the prior tax year.” The claim is due “on or before August 1 following the end of the tax year for which the exemption is claimed” (ORS 307.289).

Oregon homestead questions

Is there an Oregon homestead declaration to file with the county?

No. ORS 18.395 makes the exemption effective “without the necessity of a claim,” as long as you, your spouse, a parent or a child actually live in the home.

I bought my house this year. Does the 3% cap reset for me?

No. ORS 308.146(3) lists what resets maximum assessed value, and a sale is not on the list. New construction or an addition you build is valued separately.

Can the deferral program pay my taxes if I have a regular mortgage?

Yes, if the loan documents contain no federal-law prohibition (311.670(5)). ORS 311.700 voids deed or contract clauses that forbid applying. A reverse mortgage is treated differently.

Will the homestead exemption stop my lender from foreclosing?

No. Mortgages “lawfully executed” and purchase money liens are outside it under ORS 18.406.

Related Oregon guides

• Oregon property tax and Measure 50
• Oregon closing costs in 2026
• Oregon real estate overview
• Property tax calculator and state tax comparison
• Homestead exemption rules by state