Learn How To Reduce Your Property Taxes - Here's How Investors Successfully Protest Their Investment Property Tax...
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Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I've got quick video on how to effectively protest your property tax.
Why Should You Protest Your Property Tax?
When you receive your property tax assessment, how often are you like... "wow, this is lower than i expected"... Rarely. The feeling is more like...
- I don't remember it being this high last year, did taxes go up again?
- How can my taxes be the same as last year when my property value dropped?
Mostly what you feel is annoyed, angry, and helpless. Amazingly, only about 10% of Texas homeowners appeal their property taxes, but of those 10%, 75% of the appeals are successful.
How To Protest Your Property Tax
Remember: Proper preparation prevents poor performance
- Request House Bill 201 Evidence Packet
- Contains all info which the appraisal district used to arrive at your property value
- Ask your county tax appraisal district for instructions on how to access it 14-days before your hearing
- Pictures Pictures Pictures - focus on the negatives
- pinpoint expensive repairs - carpet, paint, fence, siding, updates
- anything that can reduce the property value
- MLS Sales/Comps
- Existing realtor - ask for comps found in House Bill
- Similar properties bought and sold past 3 months.
- Remember: you are looking for properties that will help reduce your property value
- Repair Estimates
- Contractors - Free Estimates
- Dated Paperwork
- Crime Reports
Note: Important to present this in an organized folder.
- Appraisers deal with hundreds of people a day
- Limit your stories and stick with the evidence
- The easier you make it for them the more likely they will work with you
What Happens When You Protest Property Taxes?
Protesting is a lot like negotiating a deal. Just because you present a good point, doesn't mean you are guaranteed the price you request. This is why it is very important you come prepared.
- The first round of protests is called your "hearing"
- You meet with an appraiser and present your evidence
- Usually the appraiser will compare what you have to his notes
- A lot of the time, their assessed value will be higher than yours
- Rare occasions they aren't and those are the easy cases
- Negotiate - back-and-forth
- Exp. Tip: Gauge the mood of the appraiser, if you feel any type of agitation, take a step back and ask the appraiser what he thinks is appropriate, and restart the process.
- Depending on how many properties you protest, on average, it takes about 15-30 minutes per property
- If appraiser refuses to reduce your property tax, you can appeal (2nd round)
- Appeals process is before a board of 3 members
- You plead your case against the original appraiser in front of the board
- Much harder process, at the appeal, they have the option to actually increase your property value
- My Advice, if you can get it done the first round, and unless you have a solid case, I would avoid the appeal.
In conclusion, you may never save a fortune in any given year with a successful property tax protest, but its important to always protest your property's value. With a continual yearly effort you could end up saving several hundred to several thousand dollars in property taxes over time. So just imagine what you could do with that extra money. One thing they don't tell you, is when you frequently protest, you can build good relations with appraisers who will make this process much easier for you every year.
Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you'll be automatically notified when we upload more quick video tips for you. Take care and good investing.