WITH SURVEY | High property assessments likely won’t drive up tax costs, assessor says
TEXARKANA — Many Bowie County homeowners received something unexpected at this year’s appraisal, an increase in property values — but higher values won’t automatically result in a much larger tax bill.
Property tax increases are limited by law, Bowie County Chief Assessor Mike Brower said.
“What the (tax) jurisdictions are required to do by law is, they have to say, last year, the year before, we brought in so much money in taxes. We have a new value for the jurisdiction, which is this and what should our tax rate be to bring in the same amount of money as last year. That’s their starting point,” he said.
Following this calculation, Brower said tax agencies can only raise taxes up to 3.5% per year.
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“So if your tax value goes up 20% in a year, your taxes won’t go up $800 or $900 a year,” he said. “They can go up $100 to $200 a year, depending on the house and its value.”
Arkansas takes a different approach. Natural state counties are appraised every five years, with the last appraisal taking place in 2020. Miller County appraiser Nancy Herron said home appraisal values have increased by an average of 25 % during the last cycle.
Total Assessment Solutions Company is the organization with which Miller County contracts for assessments. Local manager Troy Gammons said that in the 2025 cycle, values will be based on home sales in 2023 and 2024.
The Association of Texas Realtors’ Data Relevance Project showed that the average taxable price of homes in Bowie County increased 20% in 2022. Home values in Titus and Red River counties increased 22% and 18%, respectively. Major metropolitan counties such as Dallas and El Paso saw increases of 21% and 23%, respectively.
“They’re seeing it (the value going up) all over Texas,” said Ronny Bailey, Bowie County appraisal supervisor. “So while in some counties we were getting 20%, when we looked at our data, we found counties that were up as much as 40%.”
Additionally, homeowners have multiple opportunities to reduce their assessed values, according to Brower. The Homestead Exemptions – which, after Saturday’s election, allow homeowners to reduce the assessed value of their property by $40,000 – also state that only 10% of the increased assessed value can be taxed in a year. given, he said.
“If we increase your value by 20%, this year it will only increase by 10%,” Brower said. “Then next year, if we do nothing, if we leave everything in place, it would increase on its own by another 10% to catch up with the market value. So it will recover that 20%, it just takes two years . to do it.”
Rising cost of goods, rising home values and general inflation have created a storm of price valuation oddities over the past year, Brower said. But these variables have begun to regulate themselves.
“Actual sales are always in the mix,” he said. “That’s what we have to work with, the sales data. We have to do what the market tells us to do. If the market tells us we have to go up like this year, then we have to go up. market says it’s trying to get lower like it did in 2000, so are we.”
With the Federal Reserve’s recent interest rate hike and expected future increases, Brower said he believes the home sales market will cool, ultimately leading to a normalization in property appreciation.
“I think we’ve seen the bulk of the upside already,” he said. “Do I think they’ll see another 20% next year? I don’t think so. I think what you’ll see is we’ll be back to normal, or we might even have a slight drop , maybe 5% slowdown by the end of the year.”
But for those who still believe their home’s value is overstated, Brower said his office is open to reviewing and possibly reassessing the value, another opportunity for homeowners to lower their assessed tax.
“If you look at your value and you honestly think your house isn’t worth what we have on it, then you need to come see an appraiser, or you can file a formal protest,” he said.