A very common issue that comes up while showing or selling houses is when the prospective buyer or seller points to the county appraisal district for value. Most of the time, it’s the buyer that points to this value. And oddly enough, when I work with someone buying AND selling, the appraisal district is seen as an authority on the purchase side but never on the sell side.
Why would that be?
Here’s the scoop:
First, the tax appraisal office is not actually an appraisal in the true sense of the word, where someone comes out and sees the house they are evaluating. This is done by the tax office who takes sales data and also tax needs into consideration to decide how much a “neighborhood” might have appreciated or depreciated over the last year. Let’s say they decide that SEVEN MEADOWS appreciated 6% last year. That may or may not be true but they apply it across the board to every house in the area.
Next, a lot of homeowners will protest their tax rate to reduce tax burdens. Generally the taxing authority tries to pick a number to raise values that will bring the least amount of protests and yet generate the most amount of revenue. When people protest, they will often be able to get at least a small reduction in their value.
Lastly, tax appraisal does not take ANY account of property condition UNLESS someone protests and shows that their property is not at the same condition as “neighborhood norms”.
So on the SELL side, the value looks low and most sellers understand their property is worth more than the tax appraisal value.
On the BUY side, the buyer looks at the tax value and assumes that the property is overpriced. Tax values and automated estimates (such as those provided by ZILLOW and other automated companies) are generally very inaccurate when deciding what to pay for a property or what to sell a property for.
The only reliable way, as Texas is a non disclosure state when it comes to public record of sales price, is to get with REALTOR® that has access to recent sales data or with an appraiser, who actually looks at the same data as a REALTOR®.
While we’re on the subject of the TAX VALUE of your home, make sure you have filed your HOMESTEAD EXEMPTION if you were in your home on JANUARY 1st 2011!