The median home value in Travis County is $632,208, an increase of about $175,000 from the beginning of 2021, according to real estate tracker Zillow.
“Reviews by the Texas Comptroller of Public Accounts have found that TCAD’s market values in recent years have been too low, particularly in areas of western Travis County,” said TCAD’s release.
Over 400,500 appraisal notices were mailed out to property owners last week. They have until May 16 to protest their appraisal.
The total appraisal roll in Travis County — the collective value of all the property within the county — rose 43 percent to $447 billion. Over $5.8 billion of that came from new property added to the rolls. In 2020, TCAD properties were not reappraised, an order issued due to the pandemic.
“The data tells a clear story. The local housing market continues to see rising property values due to high demand and low supply,” said TCAD Chief Appraiser Marya Crigler. “We expect this to be the busiest protest season we have ever had. Property owners should get their protests filed early to have the most opportunity to discuss their property with our appraisers.”
Those economic stresses are driving up home values across the state, too — 20 percent to 50 percent across the board in Texas — but are accentuated in Austin due to both the incredibly high demand to move there and the strict zoning policies the city has in place. Compare Austin’s median home value to Houston’s, which has relatively loose zoning laws, at roughly $256,000.
A few years ago, the Austin City Council tried to adjust its zoning policies, but it has since been bogged down in court after 14,000 residents filed protests. Last month, a court ruled the council violated public notice requirements during that process, moving it back to square one.
Austin’s affordability problem is something city officials have spoken plenty about recently, and is among the top issues for the mayoral candidates. Part of that response is to explore a universal basic income program, a pilot that will pay 85 families $1,000 per month for a year.
But on the tax side, each year more property taxes are collected by the city and the other taxing entities in the area, the largest collectors being school districts. Texas’ property tax-heavy system means that homeowners feel the direct brunt of the appraisal increases when tax rates are adopted by local officials.
Crigler added, “But increases in market values should not cause panic about future tax bills. Property owners with a homestead exemption still benefit from a 10 [percent] cap on the increase of their taxable value.”
Multiple exemptions are available to property owners, especially homeowners. Before anything else is applied, the taxable value of a home may only increase 10 percent year-to-year with a homestead exemption. After that, there is the $25,000 state homestead exemption specifically for school districts, which may rise to $40,000 if the constitutional amendment on the May 7 ballot passes next month; there are also exemptions for disabled individuals and seniors aged 65 or older, increases for which are also on the May 7 ballot; and the local option of a 20 percent reduction in taxable value for cities and counties on top of the initial 10 percent homestead exemption.
Additionally, disabled veterans have a tiered exemption available to them based on how disabled they are — with 100 percent disabled veterans exempt entirely from property taxes.
Businesses do not have the same array of exemptions available to them that homesteads have, but there is a $500 business personal property exemption set in place since 1996. That means any property a business owns up to a $500 value that it uses in its day-to-day operations, i.e. not the land or building itself, is exempt from taxation. Business personal property taxes must be paid on any value above that level.
See a list of the possible exemptions for taxpayers provided by the Texas Comptroller of Public Accounts here.
Local officials and appraisal districts often point fingers at one another over rising tax bills. But it’s the local governments that set the tax rate, with the full appraisal role information before them. Unless local officials adopt the no-new-revenue rate, or a lower rate, is at cities, counties, and school districts, the amount paid by property owners will increase. Even if the tax rate is reduced, it is not guaranteed that tax bills will decrease because of the year-to-year appraisal increases.
In her open letter to property owners, Crigler said, “These increases may seem intimidating. But it is important for property owners to understand that the appraisal district does not set local budgets or tax rates.”
“Your city, county, and school district are among the taxing entities that determine how much money needs to be brought in every year by property taxes.”
Most localities will adopt their tax rates in August or September of this year.
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Brad Johnson is an Ohio native who graduated from the University of Cincinnati in 2017. He is an avid sports fan who most enjoys watching his favorite teams continue their title drought throughout his cognizant lifetime. In his free time, you may find Brad quoting Monty Python productions and trying to calculate the airspeed velocity of an unladen swallow.