Sticker Shock: Property appraisal values increase with strong market

🕐 5 min read

Homeowners across Tarrant County who have received their property appraisal notices have let out a collective gasp.

The Tarrant Appraisal District mailed more than 600,000 property value notices, primarily to homeowners. Commercial property owners should expect their notices around April 15.

Many of those who received their notices immediately filed paperwork to protest their new values and many more are expected to do the same by the May 15 protest deadline.

The sticker shock reflects soaring home prices that have boosted market values by 50 to 90 percent during the past five years. For many homeowners, that translates to appraised value increases of up to the maximum allowable of 10 percent per year.

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“The real estate market we are currently seeing is the best I have witnessed in decades,” Tarrant County Chief Appraiser Jeffery Law said in an email. “We do not determine the marketplace, we only follow what the real estate market is doing.

“Buyers and sellers determine what is going on in the market,” Law said. “For the past several years, demand has outpaced supply and that will always cause prices to increase.”

Law points to data from the Texas A&M Real Estate Center that reflects the market increases in the Fort Worth-Arlington area during the past two years. The average home price in the area rose from $237,238 in 2017 to $247,723 in 2018 to $270,570 this year, an increase of 9.22 percent from 2018 to 2019.

Meanwhile, the median home price rose from $200,000 in 2017 to $214,500 in 2018 to $232,000 in 2019, an increase of 8.16 percent.

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Furthermore, the latest home price data from global property information and analytics firm, CoreLogic, shows that the Fort Worth area had the highest home prices increases in February of all the major metro areas in Texas. Prices in the Fort Worth area were up 5.73 percent compared to February 2018.

Prices in the Dallas area rose 3.96 percent during the same period. Prices in Austin were up 3.7 percent; 3.43 percent in the Houston area and 4.95 percent in the San Antonio area. The statewide increase was 3.5 percent and the national increase was 4 percent.

The Fort Worth area also led the state in home price gains in January, registering a 6.36 percent increase over January 2018, according to CoreLogic.

“With the Federal Reserve’s announcement to keep short-term interest rates where they are for the rest of the year, we expect mortgage rates to remain low and be a boost for the spring buying season,” said Frank Nothaft, chief economist for CoreLogic ”A strong buying season could lead to a pickup in home-price growth later this year.”

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While rising prices would be a bright spot for sellers, industry leaders say it would continue to erode affordability for many would-be homebuyers. It would also translate to continued growth in property values and high taxes for homeowners who have interest in buying or selling.

Law said he expects to see property values up 7 to 10 percent on average across Tarrant County. TAD expects about 148,000 protests, similar to last year, he said.

“I would also expect to see similar increases in values in other urban counties all across Texas,” he said in an email. Estimated property tax rolls should be ready by the end of April, he stated.

Homeowners can also expect to see similar increases in their assessed values as appraisers try to close the gap between market and assessed value, said Stephen Dunson, president and owner of IntegraTax, a Fort Worth property tax consulting firm. Assessed value is the taxable value for property.

“Property owners will continue to get hit with 10 percent increases until assessed values catch up to market value,” Dunson said. If market values continue to climb, then property taxes will remain in a catch-up cycle until the real estate market cools.

A change many homebuyers may be observing this year is steep increases in the value of their land, Dunson said.

“The ratio between the value of the land and the value of the home need to be kept in balance,” Dunson said. “Otherwise, you have a situation where you have a $1 million home sitting on a $10,000 lot.”

In many cases, land valuations have not kept pace with home valuations so land is vastly undervalued, he said.

Tarrant County taxpayers aren’t alone in feeling the sting of higher taxes. Across the country, homeowners paid an average of $3,498 in 2018 for a single-family home, up 3 percent from 2017, according to Attom Data Solutions, a data analysis firm.

Texas, which relies heavily on property taxes to fund schools as well as state and local government functions, ranked third behind New Jersey and Illinois as states with the highest property tax rates.

Adding to the misery for taxpayers, Dallas-Fort Worth had the highest property tax increase in the U.S. at 8 percent in 2018 of the 219 metro areas Attom analyzed. The study shows that 120 of the 219 metro areas had property tax increases above the 3 percent national average.

The Texas Legislature has been grappling with ways to reduce the property tax burden for Texans. Among the legislation that has been introduced this session are bills that include raising sales taxes to reduce property taxes, increasing homestead exemptions and reducing school property tax rates.

Changes to homestead exemptions would provide not relief to renters or commercial and industrial taxpayers.

Another proposal that has gained some traction is capping property tax increases at 2.5 percent.

Tarrant County taxpayers who plan to protest their taxes they can do so by mail, online at or by visiting the TAD office, 2500 Handley Ederville Road in Fort Worth.

Although the appraisal district struggled though technology problems a few years ago that resulted inaccurate appraisals, the problems have been corrected and Tarrant County has one of the efficient and modernized appraisal systems in the Dallas-Fort Worth area, Dunson said.

“They are also become very proactive in helping taxpayers,” Dunson said.

Homeowners can negotiate a value reduction online as well as filing a protest.

“Our online protest features also allows property owners to submit a limited amount of evidence to be reviewed by the appraisal staff,” Law said. “Anyone looking to file a protest should always remember that evidence such as photos, sales, documents or repair estimates will be more helpful in determining the correct market value of their property.”

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