Home Worth Less? Appeal Your Property Tax Value!

Has the housing bubble lowered your property value? Is money tight? Would you like to lower your monthly mortgage payments? Is your property still being taxed for what it was worth a few years ago? Would it be nice to pay less property tax, but you just don’t know how? Do you think that tax appeals are just for cheats and you would never be so unethical? Read on to answer these questions and to see the results of a reader poll.

Don’t go it alone

It was my first house and there was an error in the paperwork. Otherwise, I don’t think it would have occurred to me to appeal the taxable value. So I read online about the requirements and procedures. Then I drove downtown to take on big government all by myself. My appeal was denied; all I gained was experience and wisdom:

The relevant documents prepared and organized

Document your comparative analysis, unequal taxation and rating for condition, desirability and usefulness
Document your comparative analysis, unequal taxation and rating for condition, desirability and usefulness | Source
  • I had gone to the full assessment review board, which was somewhat intimidating! They have an informal alternative that I by-passed. Don’t! (I can’t remember why I did.) Subsequently, whenever I took the informal route, I was sitting down one-on-one in a much more relaxed atmosphere.
  • I was loaded to the gills with photos of things that needed attention or detracted from the value of my house. But it was only two years since I bought the place and they said I wasn’t allowed to use this line of appeal until the third year. Since I’d been willing to pay that amount two years ago, that’s what it must be worth, according to them.
  • About the paperwork error that included closing costs in the value of the house—uh—that’s the one document I neglecting to bring. Oh, shucks.
  • Two years later, I went back again, this time denied after trying the informal route and carrying spreadsheets showing comparable houses that were taxed lower than mine. What made the difference this time was that my house was considered to be in Excellent condition and the others on my spreadsheet were not in that condition. Of course, this time I’d left the photos home, but they might not have shown the right things anyway.

So I gave up and just paid my taxes without complaint like a good citizen should. They were up 8% by this time from when I bought the house.

House appraisal for tax appeals

What I learned by hiring a tax attorney

It was actually a couple of years later that I received a piece of junk mail from a tax attorney’s computer saying it figured my taxes were too high. The offer was that they would appeal and I'd pay them half of the tax savings for that year. Why not? I had nothing to lose.

So I filled out the forms they sent me. But I was rather lazy and didn’t send them any photos or anything else that they couldn’t get without actually visiting the property. They did their part based on public data that their computer could process, and my property tax fell by about 4%. By the time it was all over, I realized that I would have had better results if we had worked more closely with each other. I knew things about the property that they didn’t; they knew things about the appeal process that I didn’t.

There’s one more thing I learned but didn’t realize until a year later. The contract I had signed was to retain them every year until I revoked it. So the next year, they’d already appealed my taxes, lowered them some and were sending me the bill before I knew they’d done it. That doesn’t sound so bad, except that this year I had planned to prepare and defend my own appeal. Well, I went ahead with my plan anyway, although it pushed me up to the formal review board (like my first attempt), and there were questions about why I was following up a month after “my attorney had represented me.” To cut the story short, I got an additional 15% lopped off my taxes—about three times what the attorney had been able to do without seeing the property or talking with me about it.

Reduce escrow payments

Property tax affects monthly mortgage payments when it is included in escrow rather than paid annually by the homeowner. That means that monthly mortgage payments decrease when property taxes do. Your results may vary due to location and other variables.

What I learned from the realtor

Somewhere along here, my wife and I called a realtor when we hoped to sell our house. It wasn’t worth enough to sell. The significant thing I learned from the realtor, though, was her professional reaction as she looked around and rattled off a list of very out-of-date features that would certainly detract from both value and market appeal if not dealt with (at great expense). I felt like acting somewhat defensive, but instead took note of the things she said. That really paid off later.

Have you ever appealed your property tax?

See results without voting

Do it yourself for best results

The next time, I was in much better shape to go up against the county appraisal district. I’d been to the formal board twice and taken the informal route once, so I knew what to expect. I had records that the tax attorney had used, figured out where he’d gotten them from and had updated them to the most recent data available. I had the formulas that the attorney had used to substantiate claims that seemed harder to justify. My goal was to knock the condition down from Excellent to Good or perhaps Average.

I took photos to the appraisal office of the features that the realtor had told me were ugly and deficient. I showed him a picture of the hallway, e.g., and said, “It’s so 1960’s,” carefully repeating the realtor’s tone of disdain. The appraiser completely agreed with that, although I still don’t know what either one of them meant by it!

The appraiser quickly fanned through about half of my photos and declared, “Your house is in only Fair condition.” That was even lower than I was asking for! This was now 17% off the previous year’s taxable value.

The house I have described here was 34 years old when I bought it at what was assessed as Excellent condition. Seven years later, the dwelling had been down-rated to Fair condition, property value adjusted for equality with comparable properties, and my property tax is 34% less than when I bought the house.

Dwelling Depreciation Table

Overall rating of dwelling
Guide to condition, desirability and usefulness
Excellent
Building is in perfect condition; very attractive and highly desirable.
Very Good
Slight evidence of deterioration; still attractive and quite desirable.
Good
Minor deterioration visible; slightly less attractive and desirable, but useful.
Average
Normal wear and tear is apparent; average attractiveness and desirability.
Fair
Marked depreciation – but quite usable; rather unattractive and undesirable.
Poor
Definite deterioration is obvious; definitely undesirable, and barely usable.
Very Poor
Condition approaches unsoundness; extremely undesirable and barely usable.
Unsound
Building is definitely unsound and practically unfit for use.
This table is from Houston, Texas. Other localities may differ, but should be quite similar.

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Comments 3 comments

Simone Smith profile image

Simone Smith 5 years ago from San Francisco

Before reading this Hub, I had no idea that anyone could appeal property taxes, but that makes perfect sense! Thanks for sharing your personal experiences and findings - plus including the helpful table and tips!


Ms Dee profile image

Ms Dee 5 years ago from Texas, USA

Thanks for passing on what you learned. Helpful video, you included, too!


Angela Brummer profile image

Angela Brummer 4 years ago from Lincoln, Nebraska

I need this so badly thank you!

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