Property Values Decline ... Will Property Taxes?

[houstonmacbro]

We hear a lot about property values declining this year (generally, and not necessarily everywhere equally ... and sometimes not even in Houston at all) ... but my question is this ...

Since property values are declining, will property taxes also be reduced?

I mean, if a house was worth $100,000 in 2006 but now its value is $95,000 will property taxes follow suit, and decline also?

[MidtownCoog]

You watch way too much TV.

[houstonmacbro]

You watch way too much TV.

I thought it was a reasonable question ...

... and you never did answer it.

[MidtownCoog]

Show me where my house is worth less becuase of some dummies with bad faux credit who got in over their heads.

HCAD won't see it either. Comp sales and equal appraisials havce to take a hit first.

From what I can tell in my area houses cost just as much they just take longer to sell.

[houstonmacbro]

What I have been hearing is that houses across the country are losing value (certain pockets of the country excluded) ... but what I am saying is if that is the case (and there are examples of houses selling for less now than before this mess), then why wouldn't taxes eventually follow suit?

This is not a rhetorical question, and I am serious.

[Ross]

If you can establish that your property is valued less than the appraisal, the taxes will go down. From the mid-80's on until the late 90's, my parents house in Katy was revalued downwards several times, even though they didn't file any protests. Property is supposed to be appraised at fair market value, so the appraisal districts should resuce values if that's really happened.

[Mark F. Barnes]

What if your propert value increased and your taxes did not? I'd say then that my propery taxes decreased.

[houstonmacbro]

I know it's kind of a theoretical argument. But I mean, why is it that taxes HAVE to keep going up IF property values decrease.

I don't have an argument either way, just wondering...

[kylejack]

I know it's kind of a theoretical argument. But I mean, why is it that taxes HAVE to keep going up IF property values decrease.

I don't have an argument either way, just wondering...

They tax [supposedly] based on the fair market value. More value = more taxes. If the value goes down as confirmed by the appraisal value they designate for a piece of property, the taxes go down on that property. They can game the system by using an unrealistic appraisal value which is more than the home can sell for, or by increasing the tax rate per $1000 of value. Motivation for increasing taxes while home values are declining would be that they want/need more money for operations or projects, regardless of whether your property has increased in value or not.

[The Great Hizzy!]

What if your propert value increased and your taxes did not? I'd say then that my propery taxes decreased.

A lot of people won't like to look at it that way but it's still a very interesting way of looking at it.

[musicman]

I know it's kind of a theoretical argument. But I mean, why is it that taxes HAVE to keep going up IF property values decrease.

property values and appraised values on hcad are two different things. the county won't lower your appraisal until they see some data showing that nearby properties are selling for less than they have them appraised (or you provide that info during next yrs protest)

the city/county hate the prospect of appraisals going down because they will have to increase the tax rate in order to keep getting the same amount of money. they've had it lucky the last decade or so and haven't had to go to the taxpayers to justify an increase because they were getting an automatic ~10% just by increased yrly appraisals.

[editor]

I think it's a reasonable question. I'm not a homeowner, but from what I understand you can argue your home's value based on the value of other homes in the neighborhood. It seems logical to me that if a bunch of your neighbors are in foreclosure or already foreclosed/abandoned/whatever that it would affect the value of your home, and thus your taxes.

[houstonmacbro]

I think it's a reasonable question. I'm not a homeowner, but from what I understand you can argue your home's value based on the value of other homes in the neighborhood. It seems logical to me that if a bunch of your neighbors are in foreclosure or already foreclosed/abandoned/whatever that it would affect the value of your home, and thus your taxes.

Yes, I guess that is what I was getting at. If homes in the same neighborhood decline 10% then I would think my taxes need to be adjusted accordingly. Maybe not a 10% decrease, but certainly not what they were the previous year.

[Mr. Chenevert]

The answer to your question is technically no.

While it would seem fair to assume that your home value would decrease, and therefore your taxes would go down, they would more than likely stay the same.

Once HCAD appraisals start to fall, the tax revenue that the city brings in will decrease. With less tax money, the city will need to raise tax rates, thus making your actual payment about the same as before the fall.

Then eventually, when home price increase again, you will be paying more than you would have before the original decrease.

[TheNiche]

We hear a lot about property values declining this year (generally, and not necessarily everywhere equally ... and sometimes not even in Houston at all) ... but my question is this ...

Since property values are declining, will property taxes also be reduced?

I mean, if a house was worth $100,000 in 2006 but now its value is $95,000 will property taxes follow suit, and decline also?

Starter homes are hurting, values may decline a bit. Everything else is pretty stable or appreciating. So the Houston area on the whole probably isn't going to see a lot of changes in property tax trends, but people paying taxes on low-value homes may now contribute a relatively smaller portion of the total tax revenues (which would be approx. unchanged or only slightly higher) as compared to those in mid- and higher-value homes.

This is, of course, assuming that the appraisal district is good and honest at what they do or that protests are common.

[HtownWxBoy]

We hear a lot about property values declining this year (generally, and not necessarily everywhere equally ... and sometimes not even in Houston at all) ... but my question is this ...

Since property values are declining, will property taxes also be reduced?

I mean, if a house was worth $100,000 in 2006 but now its value is $95,000 will property taxes follow suit, and decline also?

Simple... if your home is assessed at a lower price than the year before the taxes will go down. If it's assessed at the same value and homes all around you are going down in value you can always protest your assessment and get your assessment / taxes lowered. I can't really see them assessing homes at lower values since that will bring in less tax money... best bet is to protest.