Deadline for Protesting Your Property Taxes Is Approaching

If you’re a member of your neighborhood NextDoor, or even a neighborhood association Facebook page, you’ve likely seen homeowners commiserating about how much their tax bill has increased since last year.

And those increases, people say, aren’t wholly unexpected. After all, the Dallas/Fort Worth area is in the middle of an incredible home sales boom — a recent report by Texas A&M’s Real Estate Center revealed that demand for housing statewide has meant that inventory levels continue to hover around 3.7 months — a historic low that means home values continue to rise.

Here are a few statistics that might grab your attention:

• In Dallas-Fort Worth, the months of inventory for existing homes remained under two months according to another Texas A&M report for May 2017.
• Total home sales in Dallas increased at 5.5 percent in Dallas in the first quarter of this year, which leads the state in home sales.
• Statewide over the past six years, Texas’ median new home price exceeded the existing home price by a little more than 47 percent.
• Year over year, Dallas home prices were up 8.2 percent from last year according to Case-Shiller (for comparison, nationally the average was 5.9 percent).
• Residential properties in Dallas County increased 9.9 percent this year, and commercial values spiked 14.6 percent, Texas Tax Protest said.

Now, this obviously means that if you’re selling your house you are probably going to be able to get more for it. But it also means you will get a hefty tax bill.

“The appraisal districts are attempting to value property based on the value they estimate it would sell for,” local property tax expert Patrick Melton of Texas Tax Protest explained. “When the market is up, the values are up as the estimated sales price of homes are up.”

Will you protest your valuation? If you’ve never protested, you’re in good company — research conducted by The Dallas Morning News revealed that only 12 percent of all property owners in Dallas County filed a protest last year. In the entire Dallas/Fort Worth area, Denton County residents were most likely to protest — 19 percent protested last year.

Why don’t more people protest? Melton said the task can seem daunting to the uninitiated, which can make people reluctant to make use of their right to protest.

“I think there are several things that keep homeowners from protesting,” Melton said. “The biggest two are not having sufficient resources to gather evidence and build a compelling case, and a lack of understanding of the system and process. I speak with many homeowners each day who have little to no knowledge of how the appraisal system works.”

The lack of knowledge makes hiring experts like Melton and Texas Tax Protest an attractive choice. “We can usually get better results, save your effort, and save your time,” he said. The deadline to file a protest is May 31.

And it’s really a low-risk proposition with the homeowner as well. Melton says that his company uses a success-based fee system that only charges the homeowner if the company is successful in saving him or her money.

And Texas Tax Protest also offers intensive data to back up a protest filing. “We have developed a proprietary software platform that applies big-data algorithms to analyze millions of data records to gather the facts we need to prepare your tax protest case,” Melton said. “We use both Sales Comparable Analysis and Unequal Appraisal methods of analysis.”

Are you a landlord? Have you considered taking a hard look at your valuations for your rental properties? Increased property tax bills can eat into that ROI, meaning you have to pass the increase along to your renters – or absorb it, something no property owner wants to do.

“Rental property is handled in the same way as a homestead,” Melton said. “It is important for an investor to protest because property taxes affect their margins.

“Keeping their property tax liabilities in check will help improve their monthly cash flow.”

In fact, Melton recommends making a property tax expert part of any real estate investor’s arsenal. If you’re dipping your toe into the world of being a landlord, Melton advises, “Delegate everything you can by building your network and include a property tax agent in that network just as you would a plumber, electrician, or any other vendor.”

At the end of the day, homeowners are responsible for proving their home should be valued at a lower amount than the appraisal district value. If marshaling that proof seems overwhelming or impossible, hiring an expert can be the right choice.