I'm in a good, but annoying situation. We bought some land in late 2019 in Spring. Proceed to build a house, luckily signed the contract before covid pricing hit so we got a comparably good deal.

With the covid pricing boost the house was taxed significantly higher than we were expecting. Boosted again this year by over 25%. It is limited to the 10% but will obviously hit hard again next year.

We both work from home almost always so don't really need to be close but I don't think my wife would want to move too much further out.

We could sell and rent something until the market cools down. I feel like we're due for a little retraction at some point. The additional value we could pull out could be invested until that point.

Am I crazy for considering this? Haven't rented since I got my first place and would feel weird but I'm thinking there may be some longer term benefits.

Have you been protesting your property taxes? I'm also in Spring (Harris Co side), and HCAD has been over-valuing houses in my neighborhood for the last couple of years. I've protested the last several years and been successful every time. I'm opting to pay a service to do it for me this year, but it's definitely something you can do yourself, with the right information and a healthy dose of patience.

I'm in MCAD but won my appeal last year. Even if I win this year there's no way it would drop below the 10% max so I know that will be hitting.

Will definitely be appealing though.

That's what I'm worried about. Despite the significant amount of equity we've added (and could re-invest), we'd still need to find somewhere else in the somewhat future. And no guarantee somewhere will be more affordable to make it worth it.

AndAg said:

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We could sell and rent something until the market cools down. I feel like we're due for a little retraction at some point. The additional value we could pull out could be invested until that point.

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We could be but what if we're not? What if the market doesn't "cool down" for a decade.

Hopefully you reinvest your equity into something that at least match what your current home would do, in this scenario.

One thing to keep in mind regarding appraisals. They're hitting EVERYONE.

The counties and the school's bond obligations aren't changing much. Klein had a few bonds pass, and a few fail. Don't know what the other schools did but can't think of anything BIG off the top of my head. As appraisals go up bond tax rates go down because the bond payments don't change.

As for M&O budgets without going on the ballot, the taxing entities cannot increase their budgets by more than 3% annually.

So appraisals go up, rates will dip. Now I don't trust Harris County "leadership" to not look for ever increasingly dumb ways to spend/waste money, but that'll take a few years. Don't know how we'll ever take CC back though with the gerrymandering that was done prior to the last election.

You could sell... But where will you go? Increasing appraisals will hit rentals/landlords even harder as us homeowners got an extra $60,000 in homestead. So taxes on rentals will rise and get passed on in rents. Unless you're looking to significantly downsize (and you're not getting that pre-covid interest rate either), I don't see a scenario where you come out ahead.

My best friend did this at the height of COVID to pay off debt. It worked out for them as far as paying everything off and having some money to invest. Currently they are in a smaller rental, but it's about the same as their previous mortgage payment. The market has dropped some in our area, but they can't get back into a house purchase because the interest rate is too high. They have a decent rental who hasn't raised the rates yet, but they are definitely locked out of buying a new house until prices drop even more (not likely) or interest rates come down (not likely).