New Construction Tax Exemption in Fargo

Fargo offers a 2-year property tax exemption on new homes — up to $150,000 of improvement value. Estimated savings of ~$4,000. Learn how to apply.

Fargo is the metro's largest market for new-construction homes, and the city makes building here more affordable with a two-year property tax exemption. Under North Dakota law, the first $150,000 of your home's improvement value is exempt from property taxes for two full taxable years after construction is complete and you move in. Land stays taxable, but the exemption alone saves most buyers approximately $4,000 over those two years. Fargo's assessor's office mails the application automatically after closing, or you can apply online. Program details current as of August 2026.

Program at a Glance

Official program page

Frequently Asked Questions

Does Fargo offer a property tax break for new homes?

Yes. Fargo participates in the North Dakota new-construction property tax exemption under NDCC 57-02-08(35). New single-family homes, condos, and townhouses qualify for a two-year exemption on up to $150,000 of improvement value.

How do I apply for Fargo's new construction tax exemption?

The Fargo assessor's office typically mails an exemption application after your closing is recorded. You can also apply online through the city's LF portal. The application must be on file by February 1 of the first exemption year.

How much will I save with Fargo's tax exemption?

At current mill levy rates, the exemption saves approximately $2,000 per year on the maximum $150,000 of improvement value — roughly $4,000 over the full two-year period. Your actual savings depend on the assessed value of your home's improvements and the mill levy in effect.

Can I combine the exemption with North Dakota's Primary Residence Credit?

Yes. The statewide Primary Residence Credit — expanded to up to $1,600 per year by North Dakota's 2025 property-tax reform (HB 1176) — stacks with the new-construction exemption. The exemption removes up to $150,000 of improvement value from your taxable base; the credit then reduces the remaining bill, up to the tax actually due. Apply for the credit online at tax.nd.gov each year between January 1 and April 1.

Does Fargo have a separate tax break for builders?

Yes. Under NDCC 57-02-08(42), builders can exempt unsold spec homes for the construction year plus two additional taxable years, up to five properties per year in Fargo. This is separate from the buyer's exemption.

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Other Cities With Tax Incentives

Modern Market REALTORS® — Jim Christl (Broker) & Shannon Barnum (Associate Broker). Serving Fargo, Moorhead, West Fargo, Horace, Detroit Lakes, and Minnesota lake country. Call (701) 205-5517.