Another property tax question... (Austin: for sale, houses, neighborhood)

[10scoachrick]

Just sold our ATL house and are headed your way! While checking the different RE sites that show taxes for various properties, I sometimes see a $1-2K difference between houses on the same street, virtually the same lot size, built in '03 or '04 and SOMETIMES the larger, more expensive home shows a lower tax amount. Is the system just that inaccurate or is something factoring in under my radar? Thx.

[atxcio]

Most sites estimate it automatically on the appraised value by the county (rather than the asking price), which can vary greatly from property to property. Most likely, if the property was sold recently the appraised value is higher; the ones that are 1-2K less may not have sold recently. Alternately, if someone bought it recently for significantly less than what the average home on the block costs (ie got a killer deal, or lowballed the seller and won out), they will likely have successfully argued their appraised value to their sales price. That would make the estimated taxes appear 1-2K lower, too.

The estimated taxes will correspond to the appraised values on traviscad.org.

But in the end, your county appraisal will end up right at your sales price or lower. So just figure the tax rate times the sales price. If the county appraisal comes in higher, you need to immediately go to the county appraisal district and show them your closing statement. If it comes in lower, dont' say anything. And don't return the sales price survey either way.

[pvaustin]

Also homestead exemption might be a factor too. But I would be amazed if someone do not apply for the exemption.

[atxcio]

Good point. Of course, that wouldn't necessarily mean the homeowner didn't file it, it could mean they actually don't qualify -- if it is a second home or investor owned, for example.

[High_Plains_Retired]

Originally Posted by 10scoachrick

Just sold our ATL house and are headed your way! While checking the different RE sites that show taxes for various properties, I sometimes see a $1-2K difference between houses on the same street, virtually the same lot size, built in '03 or '04 and SOMETIMES the larger, more expensive home shows a lower tax amount. Is the system just that inaccurate or is something factoring in under my radar? Thx.

I had to note with amusement that your are headed to Austin the source for Texas tax legislation. If you do happen to figure out Texas property tax codes, I would very much appreciate knowing. My family has been considering selling our Albuquerque home and returning to our native State of Texas but I have not been able to comprehend the Texas property tax system, if in fact there is a "system." Substantially high property taxes in Texas is about all I have been able to glean from looking at the very confusing system. For example, my taxes on a $300,000 house in Albuquerque are about $1700. The property taxes on that same house if placed in some Texas counties appear to calculate out at around $6,000 to $7,000. On top of this, some Texas counties assess a substantial property tax on private vehicles. The presence of an income tax in New Mexico, and the lack of one in Texas, does come close to accounting for such an astounding difference in property taxation.

In short, I have just about concluded that Texas property taxes are pretty much an "every-county-for-themselves" type of system and one needs to look closely at the taxes assessed on a specific property of interest before making any purchase decisions. With the 254 Texas counties, it's almost like there are 254 small nations each with its own tax laws. To make matters more complex, there are tax precincts within each county doing their own thing.

[austin-steve]

In short, I have just about concluded that Texas property taxes are pretty much an "every-county-for-themselves" type of system and one needs to look closely at the taxes assessed on a specific property of interest before making any purchase decisions. With the 254 Texas counties, it's almost like there are 254 small nations each with its own tax laws. To make matters more complex, there are tax precincts within each county doing their own thing.

Sound to me like you indeed have it figured out. There is not a universal tax rate that can be applied to all homes. It varies greatly from area to area, as you have correctly ascertained. I pay 1.88% where I live outside Austin City Limits inside Travis County. A home in Steiner Ranch pays about 2.69%. Those are the two extremes, for the most part.

In general though, there are only two pieces of information needed to estimate the property taxes for a home you're thinking of buying:

1) Tax rate for the house (available through public info, County tax website). Just add together all the various taxes to arrive at the total rate.

2) Market value of home (instead of appraised value). Use market value to get your highest possible amount to pay, before exemptions.

Multiply 1x2 and you have the worst case scenario, which is what you want to consider. The actual tax you end up paying may be lower because most (but not all) homes have an appraised value lower than the actual market value.

Steve

[jwb123]

Originally Posted by 10scoachrick

Just sold our ATL house and are headed your way! While checking the different RE sites that show taxes for various properties, I sometimes see a $1-2K difference between houses on the same street, virtually the same lot size, built in '03 or '04 and SOMETIMES the larger, more expensive home shows a lower tax amount. Is the system just that inaccurate or is something factoring in under my radar? Thx.

I know for example, in my neighborhood, one section of a street is in "city limits" and one is not - so the area that is in city limits has lower taxes than the other.

[johnrex62]

A difference in the final tax bill can also be affected by the efficiency of the homeowner in protesting his valuation. Some argue effectively and get a lower appraisal and some do not, most do not seem to bother at all.

[austin-steve]

The most effective way to protest is to bring data and facts. I've protested 100's of property appraisals because I use to do it as a service for my property management clients. Each year I'd go in with anywhere from 5 to 35 properties, and go through them with the appraisal representative. I was always successful (except for the "sacrificial lamb" properties I learned needed to be included - long story).

In doing so, I would often overhear people in the adjoining cubes making emotional arguments but offering no data or fact to support a value decrease.

The most effective way to protest is to:

1) Get a CMA from a Realtor showing value. The appraised value is based on the January 1 value each year, so the CMA should be for sales from the 6 months prior to Jan 1 even if you are doing your protest meeting in June.

2) Take pictures or bring a written list (that the tax person can keep for your file) of data/information about your house that affects the value.

For example, a bid for foundation work that is needed, pictures of the unsightly industrial building across the street, you super tiny or steeply sloped back yard, pictures of your window units and space heaters showing that the home is not updated, etc. Information like this is key.

3) Be nice.
I've heard a lot of people in the tax office acting curt and rude toward the appraisal rep during the informal hearings. Usually these are the same people who bring no information to support their protest, and they leave angry that they received no relief.

The appraisal reps are just County employees doing their job. Be cordial and businesslike and, along with the good information you bring, you help them help you and you'll get better results.

Steve

[TexasHorseLady]

What Steve says. It also helps if your photos and information are very organized, AND bring a copy of both to give to the person you'll meet with as well as the copy you'll keep for your records. I did this as a matter of course when we successfully challenged our tax appraisal one year when everyone was challenging - there was a long, long time, people were spending lots of time in the office, we were in and out with a decision n our favor in 5 minutes, and the gentleman we met with asked if he could keep the photos we'd brought - in a small binder - to back up his decision. Absolutely! said I.