CENTRAL TEXAS (KXAN) — Lea Brown purchased her Leander home last June. Today, its appraisal value is $247,000 higher than last year — and because of its purchase date, she will not be eligible for a cap on how high her property tax bill climbs this year.
It’s a trend some Central Texas realtors fear will become a growing problem as Austin’s white-hot housing market leads to skyrocketed tax bills for new homeowners.
In Texas, homestead exemptions act as tax breaks to lower the amount in taxes homeowners pay. Exemptions can apply to school and county taxes, as well as specific stipulations for homeowners who are disabled or age 65 and older.
Then there are caps, which put a 10% limit on the amount a residence’s appraised value can increase, thus limiting their tax bill’s growth.
For new homeowners, this cap doesn’t go into effect until the next tax year. For example, a homebuyer who purchased their house in 2021, like Brown, will not see this reflected on their tax bill until 2023.
Chris Warren, owner and broker with Smart Source Realty, has worked as a real estate broker since 1995. During the 2000s, he said the Austin metro’s real estate scene was flat and didn’t see much activity.
Within the past five years, though, Warren said that’s all changed.
“I’ve never seen anything like this,” he said.
As home values have increased dramatically in Central Texas, Warren said that burden will be felt by new homeowners on their tax bill, as well as by landlords who will be left grappling with rent hikes if they aren’t escrowing enough.
“Landlords, if you’re leveraged on your mortgage, you’re going to be negative cashflow on your property and if you’re not escrowing enough, you could easily be out $1,000 a month, and then the landlord could default,” he said. “So it’s horrible.”
The statewide deadline to file a protest to dispute a home’s appraised value is May 16. Within Travis and Williamson counties, homeowners can file that protest online, in person or via mail:
- Travis Central Appraisal District:
- Online protest form
- Mailing address:
Travis Central Appraisal District
PO Box 149012
Austin TX 78714
- Drop-off location:
850 E. Anderson Lane, Austin, Texas 78752
- Williamson Central Appraisal District:
- Online protest form
- Mailing address/drop-off location:
625 FM 1460, Georgetown, Texas 78726
Homeowners can also look up their estimated appraisal values by searching their address on TCAD and WCAD’s websites.
Even if homeowners purchased their home in 2021, Warren still stressed the value of filing a protest and attempting to dispute the value hike. Reasons for appraisal value protests include if the appraisal is over market value or is unequal when compared to similar properties.
Warren denounced the practice of tax appraisals climbing above 10%, adding Austin’s continued growth and revenue generation shouldn’t come as a hinderance to homeowners.
“No one should pay more than 10% [in increased appraisal values] per year — we shouldn’t go up more than rate of inflation. Property tax should not go up 40% for anybody: a commercial, Whataburger, landlords, it doesn’t matter. It just makes no sense,” Warren said. “We’re not getting services rendered that are 40% better. We’re not getting 40% better police, or firemen, or schools or anything else. And I don’t know what’s going to happen.”