Win Your Next Property Tax Appeal in Texas – 10 Basic Steps
First – Learn the Facts
You are most likely to succeed with your property tax appeal if you find factual errors in your property tax record, also known as an “appraisal card”. Mistakes in real estate appraisals, such as errors about the age of improvements or incorrect square footage measurements are not uncommon.
After you file a Notice of Protest, the appraisal district will schedule an informal conference with one of their staff appraisers. Bring any proof for your case to the appointment in the form of photos or other documentation supporting your claims. The appraisal district will need to keep your evidence for their file, so remember to bring extra copies.
Understand How Your Home Has Been Appraised
Harris County Appraisal District [HCAD] has over a million single-family residential properties to appraise. Montgomery Central Appraisal District [MCAD] has responsibility for valuing about 250,000 homes. The daunting reality is that there are not enough well-trained staff appraisers to go around.
In the real world, appraisal district employees sometimes are not able to inspect much beyond new construction or additions. Even when properties are inspected, the examination may be hardly more than a drive-by. It is more common now for appraisal districts to rely on aerial pictometry for various aspects of property inspection. The level of technological resources now available to most appraisal districts is impressive.
Given the overwhelming number of properties that must be re-valued, these appraisal districts are dependent on computer mass appraisal models. The mass appraisal models that counties use are inevitably imperfect, although some are better than others. Your quest will be to determine the ways and the degree to which your property and your neighborhood have not altogether fit the model.
You may ask a real estate agent to help you find some comparable homes and their actual sales prices. Most good agents don’t mind helping you, because you may work with them later. Remember you want to be able to prove that your house is in a lesser condition than the comparable sales. Try to compare your home to the best ones in your neighborhood. If you can find information on better homes that sold below your assessed value during the prior year, you may have the grounds for a reduction.
Research the Value of Your Neighbors’ Homes
The easiest way for most homeowners to develop an appeal is to use the sales comparison approach to market value in their appeal, however the sales do not always favor your case. Another angle you can try is to determine if your home has been appraised in a “uniform & equal” manner to other similar properties in the same neighborhood.
Check if the appraisal district’s value of your house is at, or below, the median of the tax appraisal value of other homes in your neighborhood. Texas appraisal districts will have this information available online through their websites.
Obtain the Appraisal District’s Evidence
Along with your “Notice of Protest”, submit a request in writing for all the evidence the appraisal district used to value your home and intends to present at an Appraisal Review Board [ARB] hearing. It is also referred to as the House Bill 201 [HB 201] packet. Review this information to ascertain how the appraisal district determined the value of your home. You may find that this uncovers shortcomings the appraisal district’s case.
Don’t Lose Hope – You Have a Few Chances to Get It Right
If you are unable to settle your case one-on-one with a staff appraiser in an informal conference, the next level of administrative appeal is a formal Appraisal Review Board [ARB] hearing. Montgomery Central Appraisal District [MCAD] will have your formal hearing the same day. They immediately escort you down the hall and show you to the waiting area to present your case. Harris County Appraisal District [HCAD] will reschedule you to return to their office on another day to have a formal hearing. You will almost always wait two weeks.
The ARB hearing will be like a minor courtroom setting in which you make the presentation of your case. An experienced senior appraiser will represent the case on behalf of the appraisal district. A panel of at least three, supposedly impartial, appraisal review board members will hear the case and render a final decision. Important Warning: The ARB has the authority to actually RAISE your property value, so consider this risk. Also, do not forget to bring extra copies of all your evidence ( five altogether ) for the appraisal district and the ARB panel.
If your formal ARB hearing does not have a satisfactory outcome, you may still have two additional options available. For residential properties valued below $1-million, you can file an application for binding arbitration through the office of the Texas Comptroller of Public Accounts. There are fees of $250 or $500, depending on the level of involvement of your case. The other option is to file a law suit in district court against the appraisal district. As both of these procedures are time consuming and costly, you will need to decide if they are practical in your case.
Get Started – 10 Action Steps
1. Get a copy of your property tax record, or “appraisal card”. Texas appraisal districts will have this information online through their websites. If you cannot find it, call the appraisal district office for assistance.
2. Review the appraisal record for errors in your favor.
3. Find out if you are eligible for any special exemptions and apply for them. Examples are the Texas general homestead, over 65, disabled, or veterans exemptions.
4. File a “Notice of Protest” before the statutory deadline. This is usually May 31st or within 30 days of sending your “Notice of Appraised Value”.
5. Study the appraisal district’s evidence, the HB 201 packet.
6. Try to get help from a real estate agent to identify the details about good comparable sales (… and remember who helped you whenever you have a real estate transaction that pays ).
7. Take photos of your home and the other properties you are using for comparison. If you do not have a good camera, borrow one; or ask a friend to help you.
8. Make detailed written notes about precisely what you think should be the right value and the reasons for the reduction. Prepare your presentation and be able to show the proof to support your claim. This needs to consist of factual evidence such as dated photos, documentation of recent sales, and neighbors’ appraisal values.
9. Be kind and respectful to the other appraisal district staff and ARB members. Never forget they are also human and have feelings, like you. Remember the time tested expression, “You can catch more with honey than with vinegar.”
10. If you think it stands in your best interest, appeal your case to a formal ARB hearing. This may be a roll of the dice though. Depending on the make-up of the panel and their state of mind on the particular day of your hearing, your ordeal could be more favorable or it could become even worse.
If all this seems like a good deal of effort, there is yet another way to help ensure you get the best possible outcome. You can have a property tax consultant prepare and present your case, providing professional representation for you at appraisal district hearings. You can get the benefits of this service on a contingency basis, so it will cost you nothing unless you actually save money — that you would have paid in taxes.