DALLAS — It’s property appraisal protest season, and we have a rare one-on-one with the chairman of the Dallas appraisal review board. Those are the people you’re trying to convince to lower your taxable value.
The chairman, James Chapman, says they want to see your explanations and your pictures that can help make a case for lowering the appraised value of your home.
Chapman says many of the protests never even get to the formal hearing because they are settled between the homeowner and the appraiser, usually in a phone call.
“We'll get started (with formal hearings) on May 11th," Chapman said. "Last year we did not get finished until the first of November. We had 201,000 protests last year. A lot of those were settled by informal (discussions) working with the appraiser.”
If your protest goes to a formal hearing, those are once again being conducted by phone in Dallas County and many other parts of the state. And for those who are nervous going in, Chapman describes the appraisal review board, or ARB, like this: “We're just like everybody else…we're like a jury.”
Important things to consider when making your appraisal protest case
As you get ready to make your lower valuation case to that jury, Chapman says if you have structural issues in your home like leaks, foundation problems, rotting wood, and others, it carries a lot of weight if you have written estimates for the work that you need done around your house.
“It does; just get an estimate and put that in with your packet when you protest," he said. "It gives a lot of evidence that something's wrong with your house. It doesn't mean that you have to get the work done. It just says here is an estimate that needs to be considered.”
Something else for you to consider when protesting: Chapman says that the board likes to take a peek at your kitchen and your bathrooms. You usually want those rooms to make a good impression with guests. That’s not the case here, though.
Kitchens and bathrooms with bad drainage, leaks, stains, outdated tile, old counters and cabinets and fixtures -- places other people might not want to eat or go to the bathroom -- could be potent helpers for anyone trying to lower their home value at the appraisal district.
That’s because those issues would also lower your home’s value with potential buyers.
"If you have a bathroom, maybe it's a little older…maybe it has stains on the tub, the shower leaks…we can take a look at that," Chapman said. "Looking on the outside of the house…we've seen some beautiful houses in Dallas County and then we get to see the inside…the pictures. And you think, oh my gosh! So yes, let's go ahead and make a correction here. And most of the time, the appraiser will agree to it too.”
The all-important neighborhood code…
Of course, as we have been reporting, your protest should also include your own handful of comps. Those are the comparable home sales near you from last year.
You’re trying to find homes like yours that sold for less than the sold homes near you that the appraisal district compared your home to. If you protest your appraisal and you ask the appraisal district for the information they used for you valuation, they must give you the information.
You can get your own set of comps from any real estate agent. But the Dallas appraisal review board chairman told us something we had never heard before. He advised homeowners who are protesting to ask whoever is helping them to make sure those comps are from the same ‘neighborhood code’ that is associated with their own property.
“The neighborhood code is a code that's assigned by the appraisal district," Chapman said. "There are probably five or six thousand neighborhood codes just in Dallas County. Do a search for your property (on the CAD website) and in the upper left-hand corner there is a neighborhood code.”
It may just be listed as “neighborhood’ and have an alphanumeric code.
Chapman cautions that neighborhood codes can be tricky.
“Just where I live, if I walk across the street past the house that's in front of me and I go past the alley, I'm in a different neighborhood code," he said. “I see it all the time. Probably 95% of the time when comps are brought in, they're not in the same neighborhood code.”
That’s a big problem, because if your comps are not from your neighborhood code and the appraisal district’s comps are, the board will probably go with their comps.
Also...homesteads!
We have reported extensively about the benefits of getting your homestead, and the homestead exemptions that come with it that shield a chunk of your property from property taxes.
Still, Chapman says, sometimes, homeowners think they have the benefit of a homestead on their property, when they actually do not. A homestead limits a property’s annual appraisal to a maximum 10% increase.
Chapman has been in protest hearings when someone comes to the difficult realization that they do not have a homestead. He says it usually starts with the homeowner citing that 10% cap.
“'It's only supposed to go up 10%.' And then they have to be sort of told, well you don't have a homestead," Chapman said. "Then they say, 'what's a homestead? Well, how do I get it? I didn't know I could. I thought I automatically got it.' It's not an automatic. You have to apply for it.”
A pro tip…
Chandler Crouch, who files tens of thousands of appraisal protests each year, free of charge for property owners in Tarrant County, says there’s an easier way and you don’t even have to show up to the formal hearing. He explains that the pros use what’s called a property owners affidavit (this is a Texas Comptroller link to download the form), where you list all your evidence that makes the case for a lower appraisal, and then you can check the box that says you won’t be at the hearing.
The board considers your protest without you there. If the appraisal board rules in your favor, great. If they rule against you, Crouch explains you can then appeal in arbitration.
“They become much more negotiable," Crouch said. "It costs for arbitration. It costs $500 upfront as a deposit. As long as you are successful and you get a dollar reduced, they'll give you $450 of that back. So, it only costs you $50 in the end. It is going to cost the appraisal district money. So, what they do is there is a specified period of time before the hearing that they become very negotiable and they're looking to make a deal.”
We have more insight from Crouch and from Chapman in our latest episode of our Y’all-itics Texas political podcast.
Meantime, looking to Austin…
A lot of people have become frustrated with appraisers, review boards and local taxing authorities, but Chapman says each of them is operating under a system that is set up by the state. And state leaders in Austin are currently debating competing plans that could offer some property tax relief for Texas homeowners.
But so far, that has not produced a definitive result.
“The legislature is going to have to do something," Chapman said. "It’s like the snowball at the top of the hill. It starts with the legislature. It rolls down. You have the different taxing authorities wanting a piece that snowball and then it comes up into the yard of the homeowner. That snowball is getting really big.”