Correct.

And the paper you got this week isn't your bill either. It's your new property value (according to the appraisal district) only. The tax numbers aren't accurate on this statement because they're using last years tax rates and this year's appraisal value. But it's an estimate basically saying "if last years tax rates stay the same, this is what you would be paying".

The taxing entities (school, county, etc) will adjust the tax rates this summer during their budget seasons, the rates will likely be lowered a bit, and you'll get your real number in October or November that, in all likelihood, will be different/lower than this statement.

This is sent out so that you can have time to go protest the value of the property if need be, before the appraisal roles are finalized in May/June.

jagvocate said:

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Tax rates are only part of the equation. The fraudulent valuation game is the other. We must rein that in too!

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I keep waiting for this to become a bigger deal with the taxing entities. There was an article in my community newspaper recently about how a local school district is going to have to make cuts because they didn't make budget this past year. Basically, they weren't able to collect as much in property taxes as the CAD projected based on initial valuations. Officials at the CAD were quoted, and they basically blamed it on all of the residential valuation protests. Protests are up double-digit percentages compared to previous years.

I've owned my house since 2013, and my property taxes last year were basically the same as they were in 2014, but my house is valued at over 40% more than it was back then Our MUD and ISD have done a decent job of reducing rates (and the ISD tax base has grown significantly).

I honestly don't see how/why the ISDs don't raise a bigger stink about the incorrect valuations. In my industry, if a company valued their assets at 25% more than what they are worth, that would be considered fraud. The is no excuse for the CAD to be so off when they have all of the MLS sales data (at least in my area they do); but mine consistently values homes at 10-20% above the sales comps. Protests wouldn't be so significant if the CAD would just do their job correctly.

TXTransplant said:

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jagvocate said:

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Tax rates are only part of the equation. The fraudulent valuation game is the other. We must rein that in too!

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I keep waiting for this to become a bigger deal with the taxing entities. There was an article in my community newspaper recently about how a local school district is going to have to make cuts because they didn't make budget this past year. Basically, they weren't able to collect as much in property taxes as the CAD projected based on initial valuations. Officials at the CAD were quoted, and they basically blamed it on all of the residential valuation protests. Protests are up double-digit percentages compared to previous years.

I've owned my house since 2013, and my property taxes last year were basically the same as they were in 2014, but my house is valued at over 40% more than it was back then Our MUD and ISD have done a decent job of reducing rates (and the ISD tax base has grown significantly).

I honestly don't see how/why the ISDs don't raise a bigger stink about the incorrect valuations. In my industry, if a company valued their assets at 25% more than what they are worth, that would be considered fraud. The is no excuse for the CAD to be so off when they have all of the MLS sales data (at least in my area they do); but mine consistently values homes at 10-20% above the sales comps. Protests wouldn't be so significant if the CAD would just do their job correctly.

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How do they have the MLS data? They are not "supposed" to.

It's government man. If they overvalue 50 people and 25 protest, 15 will get down to their actual, 10 will get down less but still get down, and the other 25 idiots will overpay. Government gets more taxes.

If you think this is bad, don't look at commercial owners where properties are mainly valued on income and protests take on average 1.5 years to settle after litigation. When a multifamily property has flat NOI but the CAD comes in and tells them their property is worth 20% higher than the previous year, at a value that they couldn't sniff in the market today, they have to carry that tax on their income statement until they settle and can show a one month "prior year assessment adjustment".

Just got my appraised value letter, and wouldn't you be surprised to hear that it went up the maximum 10%…. Yet again.

Who could've predicted that?

TxAG#2011 said:

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What's the problem here? Rental properties should be paying more in taxes.

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Why should the burden be shifted on to renters more so than homeowners?

cgh1999 said:

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I've lived in the same house for over 15 years. My income has gone up significantly since I bought this house. I have kept a log comparing what my property taxes are versus what I would have paid in income taxes in Louisiana. Every year, taxes have been cheaper. However, the two are rapidly converging. Living below my means Has provided me with financial comfort, however, now I feel like My home is a prison. Buying a nicer, and larger home would cost me significantly both in mortgage, but more importantly in taxes. The system is definitely broken.

Honestly, I think we should move to a state income tax. Clearly, those with means would be taxed more, but if they are honest about the calculation, they're probably already in an expensive house paying the same now. At least taxes would be greatly reduced once you retired.

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Now....extend your comparison out into retirement.

I think that's where the biggest disconnect is in our system. It's easy to compare Texas to states like Louisiana, Colorado, etc. and show how we're pretty similar, with Texas being even lower in taxes. But, those property taxes don't decrease when you lose your job, retire, etc.

Harris Co has MLS data. When I protested last year and declined my iSettle offer (the first time I've done that), HCAD sent me a report of the last three years of sales in my immediate area and the adjacent areas. I used that info when I went to the appeal board (and got a better valuation than my isettle offer).

Included in the report were sales dates and sales prices. They know exactly how much every house in my hood that is listed on the MLS sells for, yet they will still overvalue those properties by 15-25%. Then they make all of the other properties match their overinflated value on a $/sq ft basis.

I remember arguing with some people back when I bought my first home in '12 that I didn't care what the tax rate was, because the house value is being set by the same group. You could have a $1MM house, but a 0.01% rate, or a $10k house with a 40% rate, you'll end up with the amount coming out of my pocket (yes, the math probably doesn't line up, but an example). But most just listened to the mailers/news they got that a politician said "we lowered the rates!"

I think, at least in metro areas of Texas, you are getting or past the break-even point for income vs. property tax rates. As someone said before, a $500,000 home (which was probably $300,000 5 years ago) at 2.5% is $12,500 a year in taxes (split between ISD and county/city). If you have a 3% or 6% income tax rate, (flat, no deductions) means you if you earn more than the following values, you would pay MORE in income tax vs. property tax. At 3%, you would need to make more than $416,667 and at 6%, $208,333.

My current house was bough in '17 and has gone up in 60% in 'taxable value', even after aruging EVERY year. I got a $5,000 reduction my 2nd year, but ever since there, it has been 20%+ on market value and 10% on taxable (homestead). So as of this year, I'll potentially pay more in property taxes to the state than if I lived somewhere were we had income tax but little/no property tax.

On a funnier note, I originally bought in Harris county, but moved to CoH. By moving, my tax rate went from ~3.2% to ~2.5%; my house value went up $120,000 but my tax bill stayed the same. And looking at my old house (just now), they are saying it is ~$50k of my current house (1st house, 2012 vs. current house, 1987).

~egon

I think that's not a bad approach in general. Would be awesome if we had a full National overlay state by state of those 3 numbers by brackets.

htxag09 said:

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cgh1999 said:

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I've lived in the same house for over 15 years. My income has gone up significantly since I bought this house. I have kept a log comparing what my property taxes are versus what I would have paid in income taxes in Louisiana. Every year, taxes have been cheaper. However, the two are rapidly converging. Living below my means Has provided me with financial comfort, however, now I feel like My home is a prison. Buying a nicer, and larger home would cost me significantly both in mortgage, but more importantly in taxes. The system is definitely broken.

Honestly, I think we should move to a state income tax. Clearly, those with means would be taxed more, but if they are honest about the calculation, they're probably already in an expensive house paying the same now. At least taxes would be greatly reduced once you retired.

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Now....extend your comparison out into retirement.

I think that's where the biggest disconnect is in our system. It's easy to compare Texas to states like Louisiana, Colorado, etc. and show how we're pretty similar, with Texas being even lower in taxes. But, those property taxes don't decrease when you lose your job, retire, etc.

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That's my main point. It's benefited me so far because I make good money and live in a cheaper house than I could "afford". But the taxes on that house have gone up almost every year…when I retire, that number will keep growing even though I don't have income.

I like the 1/3, 1/3, 1/3 as presented. It seems the most fair. Quick google search tells me that Louisiana has the lowest state property taxes. But I'd have to live in Louisiana.

Louisiana's state income tax (~6%) and sales tax (~9.9%) would piss you off. And you'd be in LA.

Appraisal down 12% in Cypress… I'm not going to argue given what prices continue to do around here.

KT_Ag08 said:

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Appraisal down 12% in Cypress… I'm not going to argue given what prices continue to do around here.

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And here I am up 30%.

I was beyond surprised when I received my 2023 tax notice. Taxes went down around 40 percent from prior years taxes. My house value was about the same as in 2022. I'm well over 65 and live in College Station. Been in my house 20 years. When I read of the legislation, I expected a small reduction. I lived in Conn. At the time. taxes on my house were about the same as in Texas. Property taxes on cars were also annual taxes based on blue book values. Add a 5 percent income tax on adjusted gross income...no deductions for federal taxes, charitable donations, etc. If today I lived in Conn, my total state and local taxes would be around 8 times my 2023 Texas taxes. I cannot complain about Texas taxes. And not so accidentally, the cost of living in Conn is considerably more than here in College Station. Counting my blessings!

your appraised value went down 40%? that would be unusual (to say the least).

Diggity said:

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your appraised value went down 40%? that would be unusual (to say the least).

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In Austin, my initial assessment was increased 40% in 2023, but my protest lowered that to a 20% increase. Now this year, it is down 30% from their revised value. A long round-trip back to less than 2022 value. Prior two years to that were up 40% and up 25%. Overall, I'm not complaining - in fact, I probably won't protest this year for the first time in a long time, as it's about 15-20% under market value, in my opinion.

yeah, I could see Austin values dropping a bit from their highs from a year or two ago. You don't always see the local CAD's agree with that though.

Dr. Doctor said:

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I remember arguing with some people back when I bought my first home in '12 that I didn't care what the tax rate was, because the house value is being set by the same group. You could have a $1MM house, but a 0.01% rate, or a $10k house with a 40% rate, you'll end up with the amount coming out of my pocket (yes, the math probably doesn't line up, but an example). But most just listened to the mailers/news they got that a politician said "we lowered the rates!"

I think, at least in metro areas of Texas, you are getting or past the break-even point for income vs. property tax rates. As someone said before, a $500,000 home (which was probably $300,000 5 years ago) at 2.5% is $12,500 a year in taxes (split between ISD and county/city). If you have a 3% or 6% income tax rate, (flat, no deductions) means you if you earn more than the following values, you would pay MORE in income tax vs. property tax. At 3%, you would need to make more than $416,667 and at 6%, $208,333.

My current house was bough in '17 and has gone up in 60% in 'taxable value', even after aruging EVERY year. I got a $5,000 reduction my 2nd year, but ever since there, it has been 20%+ on market value and 10% on taxable (homestead). So as of this year, I'll potentially pay more in property taxes to the state than if I lived somewhere were we had income tax but little/no property tax.

On a funnier note, I originally bought in Harris county, but moved to CoH. By moving, my tax rate went from ~3.2% to ~2.5%; my house value went up $120,000 but my tax bill stayed the same. And looking at my old house (just now), they are saying it is ~$50k of my current house (1st house, 2012 vs. current house, 1987).

~egon

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You're right conceptually since tax = appraised value * tax rates, but the individual tax jurisdictions (city, county, MUD, ESD, etc.) set their rates independently and the CAD sets the values for all property. They're largely all government entities, but it's not the same groups.Like you said though they'll all get the money they need to operate.

It blows my mind how people don't think the increase of the homestead exemption amount saved them money. You may owe the same or even more, but it's because market value went up. Property values were going up regardless of what the legislature did so if the exception would have not increased everyone would owe an additional $60,000 times your tax rate (for the jurisdictions that can be reduced by the homestead exemption).

Diggity said:

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your appraised value went down 40%? that would be unusual (to say the least).

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..........No, the appraised value did not go down 40 percent...it did not go down.