What do you tell the appraisal district about your house??
Let’s just face it — sometimes the sold data just does not cooperate. Every comp you look at justifies the appraisal district’s value. Are you at a dead-end?? Maybe…. But don’t throw in the towel just yet!! Remember, at best the district has seen only the front of your house and most likely not even that. In this article, we will discuss ways to reduce your property taxes without comparables. Let’s start with what the district thinks they know about your house – even though it is unlikely they have been inside. Every district uses some kind of “condition” rating as part of the value equation. In Dallas, it is the CDU (condition, desirability, utility) rating (poor to excellent). With other districts, they may use an “effective age” or “effective year built/ effective year of construction”. A house built in 1985 which has been extensively updated may have and effective YB of 2002. Most districts put this information on their website. How does that stack up with the actual condition of your house? If, in your opinion, the condition of your house is less than the district’s rating, read on. If not, see our previous blog, “Let Sleeping Dogs Lie.”
But if your house needs repairs or lacks updating (let’s call this cosmetics), this may be another way to reduce your value. There is a difference in repairs needed and cosmetics needed. In the property tax world, we find that you usually get more bang for the buck by pointing out repairs needed as opposed to cosmetics needed – but we recommend you try both if applicable. Let’s look at a few issues and see if they fall into “Repairs” or “Cosmetics”. Generally, if you can show the district something that affects the value that they don’t already know, you have a good chance for a reduction. Although many of the items below have a low potential for a reduction by themselves, collectively they may result in a noticeable reduction. But you must offer some kind of proof. They will not take your word for it.
|Repair||Cosmetic||Support Needed||Reduction Potential|
|Leaking Roof||X||Roofing company quote||Medium-High|
|Foundation Work||X||Foundation Co. quote||High|
|Wood rot/exterior paint||X||Pictures/ quote helpful||Medium|
|Old Carpet/Tile||X||Pictures||Low unless district has your house rated high in condition|
|Original Kitchen||X||Pictures||Low – Medium|
|Old HVAC system||X||Quote||Low unless not functional|
|Cracked Driveway||X||Pictures||Low unless not functional|
|Poor Landscaping||X||Pictures||Low unless well below normal for the area.|
|Drainage Issues||X||Pictures and quote||Medium|
|Cracks in Brick||X||Pictures and quote||Low unless foundation work needed.|
|Fence in disrepair||X||Pictures||Low|
|Mold||X||Pictures and quote||High if significant area – can’t be just around A/C vents and tile in shower though.|
The pattern here is that repairs are generally health, safety, and soundness issues (needed to preserve the property) whereas cosmetic issues fall more into discretionary expenditures.
Presentation is everything, of course, with a property tax appeal. Because this was such a hot topic in our chat lines and knowledge center last year with more than 4,000 views, we developed a time saving wizard to help you organize your pictures and materials. This will be ready for the 2019 protest season. You can check this out at www.propertytax.io beginning in March 2019.
The takeaway – Sales comps are always a good way to reduce your value but don’t overlook property condition issues as well and remember, tell (better yet, show) them something they don’t know about your property!
Important Note – appraisal notices will hit the mail around April 15 this year and the deadline to protest is May 15 (not the old May 31 date). To make sure you don’t miss the date, sign up for a reminder at the link to the right.