Houston Property Tax Explained

Houston property tax process simplified by top Houston realtor, Paige Martin.

Houston Property Tax Explained

Here's a quick overview of the Harris County (Houston area) Property Tax process from hcad.org.

Note, the principal thing that a Houston area homeowner can do to reduce their property taxes is to take advantage of their Homestead exemption.

"Buying a house in Houston with The Houston Properties Team was just the start of our relationship. They helped me build friends, relationships and support as new residents in Houston. They truly went above and beyond to help make our lives better even after our move." – Brandon, Google Review

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Table of Contents

  1. A Quick Overview of The Property Tax Process
  2. What Can Property Owners Do To Have Fair Appraisal?
  3. The Best Houston Realtor to Sell Your Home

A Quick Overview of The Property Tax Process

A Quick Overview of The Property Tax Process

If you have more questions about property values, homestead exemptions, and appraisal, please contact Paige Martin at PMartin@HoustonProperties.com, ranked #1 Individual Agent with Keller Williams in Houston and #10 in the United States.

The property tax is the primary source of local government revenue in Texas, and it is important for property owners to understand how the process operates.

1. The appraisal process.

An appraisal district in each county determines the January 1 market value of all taxable property. The property is appraised at that value unless it is a residence homestead subject to a cap.

Capped homesteads are limited to increases in the appraised value of 10% each year. Once a property’s appraised and market values are equal. Further increases (or decreases) in value will depend on the market in that neighborhood.

The appraisal process allocates the tax burden to ensure that no one property pays more or less than its fair share.

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2. The tax rate.

The governing bodies of the various local government jurisdictions (county, school districts, cities, municipal utility districts, college districts, hospital districts, etc.) set an annual tax rate.

When applied to the total appraised value of all taxable property within that unit, generates the amount of money needed to fund that governmental unit’s operations for the year.

Whenever a local government sets a property tax rate, it must comply with Article VIII, Sec. 21(a) of the Texas Constitution, which provides:

"a) Subject to any exceptions prescribed by general law, the total amount of property taxes imposed by a political subdivision in any year may not exceed the total amount of property taxes imposed by that subdivision in the preceding year unless the governing body of the subdivision gives notice of its intent to consider an increase in taxes and holds a public hearing on the proposed increase before it increases those total taxes. The legislature shall prescribe by law the form, content, timing, and methods of giving the notice and the rules for the conduct of the hearing."

In short, the Texas Constitution defines an increase in local tax revenues as an increase in taxes. It requires the local governing body to give notice that it is considering such an increase and hold a public hearing.

The legislature determines how and in what form the notice is given. Sec. 21(b) goes on to provide that certain revenue changes – those resulting from new construction, new exemptions, or annexation or deannexation – are not counted in determining whether revenues have increased.

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In the last legislative session, the legislature changed several elements of the process. This includes adding a requirement that the ordinance adopting the tax rate must state whether an increase in maintenance and operations revenues is being made. The process is not materially different from what has been the law since the late 1970s.

Taxes are calculated by multiplying a property’s taxable value by a tax rate. The value of the property is determined by the market—what that property would likely sell for on January 1 of the year. As noted previously, each taxing entity’s governing body determines the tax rate.

The constitution requires the appraisal district to set the value, without regard to the effect that the valuation will have on revenues. Then, it is up to the taxing entities. Their action in setting the tax rate determines the total tax burden that citizens will have to bear.

Taxing entities can adopt a rate that increases that total burden, decreases it, or leaves it the same. Once they have done that, the property’s value determines what proportion of that total burden each individual will pay.

If an individual value changes from year to year, the taxpayer’s portion of the total relative to everyone else will change. But, if the governing body chooses to grow the total, then everyone’s share grows as well.

The Harris County Appraisal District is committed to making the valuation process as fair and as accurate as possible. However, it is important for property owners to understand that HCAD has no control over the tax rates that individual jurisdictions set.


What Can Property Owners Do To Have Fair Appraisal?

What Can Property Owners Do To Have Fair Appraisal?

"The Houston Properties Team make real estate transactions a lot less complicated for sellers – they take care of everything AND they get the highest prices and the shortest closings. Paige went the extra mile in helping us and has been diligent in giving us reliable and intelligent recommendations. You're the best Paige and congrats on being the #1 Keller Williams agent in the entire state of Texas!" – Kathryn (Google Review)

There are things that property owners can do at the appraisal district to ensure that their appraisal is fair and that their share of the tax burden is no higher than it needs to be.

Taking advantage of the homestead exemption is the principal thing a homeowner can do. Homestead Exemption allows you to have a lower appraised value on your property. In effect, you can pay lower property tax. To gain elegibility, you can read more about Homestead FAQ and the application guide.

In addition, property owners can protest their value to the appraisal review board if they believe it to be incorrect. Questions regarding tax rates, on the other hand, should be directed to the elected governing bodies of the jurisdictions in which your property is located.


The Best Houston Realtor to Sell Your Home

The Best Houston Realtor to Sell Your Home

The Houston Properties Team has a well-defined structure based on the individual strengths of each member. Each member is a specialist in their role – which is why our homes sell faster and for more money than average.

Paige Martin, Broker Associate with Keller Williams Realty, and the Houston Properties Team are ranked among the top residential Realtors in the world.

They have been featured on TV and in dozens of publications including The Wall Street Journal, Fortune Magazine, Reuters, Fox News in the Morning, Money Magazine, Houston Business Journal, Houstonia, and Houston Chronicle.

Paige Martin was just ranked as the #5 agent in the world with Keller Williams, completing over $1 Billion in Houston residential real estate sales.

Her recent awards include:

– 2021 Best Real Estate Teams in America, RealTrends.com
– 2021: Top 100 Women Leaders in Real Estate of 2021
– 2021: America’s Top 100 Real Estate Agents
– 2021: Top Real Estate Team (Houston Properties Team), Houston Business Journal
– 2021: Best Houston Real Estate Team, Best of Reader’s Choice
– 2021: Top Real Estate Team (Houston Properties Team), Houston Business Journal
– 2021: #1 Real Estate Team, Keller Williams Memorial
– 2020: America’s Best Real Estate Teams, Best of America Trends
– 2020: Best Houston Real Estate Team, Best of Reader’s Choice
– 2020: Top Real Estate Team (Houston Properties Team), Houston Business Journal
– 2020: #6 Individual Agent, Keller Williams, Worldwide
– 2020: #1 Individual Agent, Keller Williams, Texas (Top Keller Williams Realtor)
– 2020: #1 Real Estate Team, Keller Williams Memorial
- 2019: Top Residential Realtors in Houston, Houston Business Journal
- 2019: America’s Best Real Estate Agents, RealTrends.com
- 2019: #5 Individual Agent, KW Worldwide
- 2019: #1 Individual Agent, KW Texas
- 2018: #5 Individual Agent, Keller Williams, Worldwide
- 2018: #1 Individual Agent, Keller Williams, Texas
- 2018: #1 Individual Agent, Keller Williams, Houston
- 2018: America’s Best Real Estate Agents, RealTrends.com
- 2018: Top 25 Residential Realtor in Houston, Houston Business Journal
- 2018: Texas’ Most Influential Realtors
- 2017: #1 Individual Agent, Keller Williams, Texas
- 2017: #1 Individual Agent, Keller Williams, Houston
- 2017: #10 Individual Agent, Keller Williams, Worldwide
- 2017: America’s Best Real Estate Agents, RealTrends.com
- 2017: Top 25 Residential Realtor in Houston, Houston Business Journal
- 2017: Texas’ Most Influential Realtors
- 2016: #1 Individual Agent, Keller Williams, Texas
- 2016: #1 Individual Agent, Keller Williams, Houston
- 2016: #20 Individual Agent, Keller Williams, Worldwide
- 2016: Texas’ Most Influential Realtors
- 2016: Top 25 Residential Realtor in Houston, HBJ
- 2016: Five Star Realtor, Featured in Texas Monthly
- 2016: America’s Best Real Estate Agents, RealTrends.com
- 2015: #9 Individual Agent, Keller Williams, United States
- 2015: #1 Individual Agent, Keller Williams, Texas
- 2015: #1 Individual Agent, Keller Williams, Houston
- 2015: America’s Best Real Estate Agents, RealTrends.com
- 2015: Top 25 Residential Realtor in Houston, HBJ
- 2015: Five Star Realtor, Texas Monthly Magazine
- 2014: America’s Best Real Estate Agents, RealTrends.com
- 2014: #1 Individual Agent, Keller Williams Memorial

...in addition to over 318 additional awards.

Paige also serves a variety of non-profits, and civic and community boards. She was appointed by the mayor of Houston to be on the downtown TIRZ board.

Benefits Of Working With The Houston Properties Team

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Our team, composed of distinguished and competent Houston luxury realtors, has a well-defined structure based on the individual strengths of each member.

We find team approach as the most effective way to sell homes. We have dedicated people doing staging, marketing, social media, open houses, and showings. Each Houston Properties Team member is a specialist in their role—which is why our homes sell faster and for more money than average.

The benefits of working with a team include:

To meet all the award-winning members of the Houston Properties Team, please go here.


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