(Why over 200,000 Harris County home owners are over-taxed by more than 10% and 30,000 are over-taxed by 50%)

Appraisal districts use a process called mass appraisal to value hundreds of thousands of houses. In Harris County, they value about 1.2 million houses each year, using a very limited staff. Most of the property inspections mandated by state low (every three years) are now done using aerial photography! Seriously, how much can you tell about the condition of a house viewing an aerial photograph? Since HCAD is not able to physically inspect the subject property in person, this limits the quality of their data.

In many cases, the computer-generated estimate of market value is within 10% of the true value. However, in about half the cases the value set by the appraisal district is either 10% high or low, because of defects in the mass appraisal process.

We believe about 30,000 homes in Harris County over-taxed by 50% or more in 2014. And about 5,000 homes in Harris County over-taxed by 100% or more. Between 200,000 and 300,000 Harris County taxes are over-taxed by at least 10%. Most home owners have no idea that such a large number of houses are over-taxes.

While this may seem incredible, it is due to the errors in appraisal district property records, inaccurate data regarding cost, depreciation and comparable sales. Further, most property owners have limited knowledge about the appeal process and believe myths about appealing property taxes. They do not understand the HCAD jargon of grade, CDU, level of remodel, land lines, etc. Compounding the problem is a reluctance to revise HCAD records. If an HCAD appraiser agrees a property is over-taxed, he will change the value. However, to correct fields of data such as grade, condition or land value is highly unusual. So the same problems occur from year to year, frustrating home owners and causing HCAD a consistently high appeal value.

Since HCAD targets 100% of market value for their homes, half of all houses are over-taxed and half are under-taxed. The result is there are at least 200,000 houses in Harris County over-taxed by at least 10%. Following is a list of some of the most egregious examples of homes over-valued Zip Code 77373. If you recognize the address, please call the owner and make sure they protest.

Property Zip Code

Property Address

Assessment Ratio

2014 Market Value

Gross Sale Price

Owner Name

77373

23122 Tree Bright Ln

165%

$92,663 $56,000 Wells Fargo Bank Trustee

77373

19102 Challe Cir E

164%

$235,732 $144,000 Dlj Mortgage Capital Inc

77373

25406 Holyoke Ln

162%

$243,309 $150,000 8355 North Freeway LLC

77373

23506 Bayleaf Dr

161%

$102,969 $64,000 Federal National Mortgage Association

77373

22810 Bridgewater Cir

160%

$91,391 $57,000 Housing & Urban Development

77373

5839 Fallengate Dr

156%

$81,293 $52,100 Housing & Urban Development

77373

23019 Harrowby Dr

152%

$106,594 $70,000 Xlt Investments Inc

77373

23234 Wintergate Dr

151%

$79,391 $52,500 Garcia Jose A

77373

4423 MONTEITH DR

147%

$78,143 $53,000 Rozell Casey

77373

623 Cotter Dr

142%

$256,293 $180,000 Terry Emily D

77373

3003 Trinity Pass Ct

138%

$192,207 $138,790 Veterans Affairs

77373

3031 PEERLESS PASS CT

138%

$147,752 $107,000 Simy Resources LLC

77373

19206 Whitewood Dr

138%

$198,344 $144,000 1 Harvest Property Investments LLC

77373

2318 Quail Haven Rd

133%

$89,627 $67,500 Bltrejv3 Houston LLC

77373

23126 Pennsgrove Rd

133%

$80,724 $60,799 Croxford Collin R

77373

23946 English Oak Dr

133%

$109,771 $82,800 Jp Morgan Chase Bank

77373

2510 Lexington Woods Dr

131%

$125,263 $95,550 Stroubakis Demetrios S

77373

23543 Tree House Ln

129%

$64,577 $50,000 Veterans Affairs

77373

2350 Loyanne Dr

128%

$88,244 $69,000 Alameda North Ventures Lp

77373

23323 Good Dale Ln

127%

$88,921 $70,000 Hughes John Edward

77373

22222 Meadowgate Dr

125%

$83,977 $67,000 Guevara Enrique A

77373

4502 Sloangate Dr

125%

$66,999 $53,500 Garcia Elizabeth

77373

25103 Lynbriar Ln

125%

$112,125 $90,000 Ladd Gerald E & Rita K

77373

23922 Clipper Hill Ln

124%

$124,857 $101,000 American Residential Leasing Company LLC

77373

19127 Center Park Dr

124%

$148,284 $120,000 Wu Wenda

77373

23318 Balthasar St

123%

$77,050 $62,500 Serrano Felix & Luz

77373

19134 Challe Cir E

122%

$330,687 $270,000 Bhimull Jagdeo R

77373

2306 Marble Falls Dr

122%

$100,339 $82,000 Srp Sub LLC

77373

23414 Cimber Ln

121%

$84,560 $70,000 Morlandhy Soriya

77373

22531 Tree House Ln

120%

$51,915 $43,300 Hickey Perry Jr

77373

23103 Cranberry Trl

120%

$71,143 $59,500 Lotz David

77373

4811 Monteith Dr

119%

$76,504 $64,044 Stalker George D

77373

25307 Avery Hill Ln

119%

$110,516 $93,000 Sfr Hou I LLC

77373

2623 Autumn Springs Ln

119%

$94,806 $80,000 Federal National Mortgage Association

77373

6603 Brookgate Dr

118%

$97,138 $82,000 Michael Raney Properties 1 LLC

77373

22827 Melham Ln

117%

$69,400 $59,500 Williams Leslie

77373

2502 Lexington Woods Dr

116%

$123,256 $106,000 Lankford Andrew & Heather

77373

19515 Whitewood Dr

116%

$231,634 $200,000 Koepp Family Trust

77373

3114 Oak Rock Cir

115%

$61,176 $53,000 Lopez Rosa E

77373

415 Wild Bird Dr

115%

$150,299 $131,000 Trevino Armando

77373

23534 Whispering Willow Dr

115%

$91,747 $80,000 Wilson J Terry & Linda C

77373

23723 Jasmine Terrace Dr

115%

$148,850 $129,900 Guel Isidro S

77373

23527 Hidden Maple Dr

114%

$115,054 $100,619 Sukhija Sandeep

77373

22622 SPRING CROSSING DR

114%

$148,235 $129,900 Baine James

77373

19931 Cypresswood Sq

114%

$207,822 $183,000 Guo Wei

77373

735 Cypresswood Cv

113%

$156,109 $138,000 Ding Lang

77373

4518 Mossygate Dr

113%

$71,013 $63,000 Housing & Urban Development

77373

25603 Chapel Ridge Ln

113%

$98,508 $87,500 Sfr Hou I LLC

77373

703 Cypresswood Rdg

112%

$142,351 $127,000 Housing & Urban Development

77373

25550 China Spgs

112%

$171,814 $154,000 Reyna Naomi % Joe Anthony Reyna

77373

25911 Long Hill Ln

111%

$128,037 $115,000 Gilbreath Gaylord L & Kathi Diane

77373

25703 Crisp Spring Ln

111%

$167,086 $150,157 Lartigue Herman & Allac

77373

627 Merrimac Ridge Ln

111%

$189,032 $170,000 Bostick David K & Diocelina A

77373

23523 Summer Pine Dr

111%

$57,699 $52,000 Fagerburg Richard G

77373

22735 Northgate Ridge Dr

111%

$166,317 $150,000 Cheng James

77373

24015 Holleygate Ct

111%

$114,040 $103,000 Hernandez Francisco J

77373

23415 Cranberry Trl

111%

$77,442 $70,000 Merino Properties LLC

77373

25414 Sugar Valley Ln

110%

$121,149 $110,000 Wallenstein Josh

77373

25402 Myrtle Spgs

110%

$166,828 $151,500 Drost Roy Louis & Debbie A

77373

3902 Hirschfield Rd

110%

$90,643 $82,500 Sfr Hou I LLC

77373

2015 Stoney Ct

110%

$95,441 $87,000 Belgard Britini Richelle & Jesse A

Since the property taxes are paid by the mortgage company for most home owners, the pain point for the home owner is about one year too late. When they receive the notice their monthly payment is increasing by $100 or $200 or more per month, the appeal deadline has likely passed. The property tax appeal deadline in Texas is May 31, or the following workday if May 31is on a weekend. However, the owner will not be aware of the consequence until early next year.

The mortgage payment will not likely be increased until after the current year taxes are paid. For example, if your home is grossly over-assessed in 2014, the monthly payment will likely be adjusted in the Spring of 2015. But the deadline to protest your 2014 property taxes is May 31 (actually June 2 since May 31 is on a weekend).

There is really no meaningful relationship between the methodical work done by an independent fee appraiser and an appraisal district appraiser. The fee appraiser typically inspects and measures the subject property, so he has accurate data. He also personally visits each of the comparable sales to see if they are really comparable. Conversely, part of preparing a mass appraisal does not include inspecting the subject properties.

For homes build before 1980, an appraisal district appraiser has almost never seen the inside of the house. They just guess at the quality of construction and condition. For homes built after 1980, the appraisers attempt to measure them. However, they are often not completed when the appraisers measure them, leading to errors including size (by double counting vaulted ceilings), and level of finish.

The appraisal districts errors regarding your property are compounded by errors in their information regarding comparable sales. The appraisal districts commit several errors systematically that tend to cause them to over-tax home owners. First, properties that sell are typically prepared for sale by putting them in prime condition. Properties that sell have often been recently painted, have new flooring, a new roof, a new HVAC and other similar items. If a buyer was considering buying a typical house not prepared for sale and one that had been prepared as advised by the Realtor, the buyer would certainly pay more for the latter. HCAD terms the cost of preparing a home for sale “maintenance” and does not recognize any difference in condition between a recently sold house and a livable house. Harris County Appraisal District also does not recognize seller concessions, which reduce the true sales price.

A second serious problem is that appraisal districts tend to use sales that have been remodeled to value houses that have not been remodeled. Incredibly, the insular culture at some appraisal districts, including Harris County Appraisal District, is they require you to prove your house has not been remodeled. This is simply a red herring to cover up the extensive errors in their evidence regarding comparable sales. There is no requirement that the property owner prove the appraisal districts records are correct. If anything, the appraisal district doubting the accuracy of their evidence about your house should undermine their credibility on other issues.

In addition to errors regarding the information about your house and the errors regarding the comparable sales, the model used by the appraisal district is imperfect. There is no model that can consistently value houses with precision. A computer model simply generates an estimate of value, based on the data provided.

Texas law requires property owners to file a property tax protest to be able to obtain the evidence regarding their house. Protest both market value and unequal appraisal and include a note asking the appraisal district to make their evidence available two weeks prior to the hearing. The protest form is available at http://www.poconnor.com/pdf_forms/41-44.pdf

In many cases, given the large number of substantial errors in valuing houses, the appraisal district’s evidence will clearly show the property is over-assessed. It is critical that you protest prior to May 31, or you will not be able to get the information and determine if you are taxed fairly.

After you protest and obtain the appraisal district’s information, one of the first priorities is to see if their evidence is accurate for your house. Then check to see if the sales data is accurate. The Houston Realtors make the photos of properties sold are on-line after the sale. For Harris County Appraisal District, you can access these at har.com.

The data used for analysis was all sales of houses in Harris County that occurred during October 1 2013 to March 31 2014, for which we had a purchase price and a 2014 HCAD market value. The only records that were eliminated were those where there was a major discrepancy between the Realtor MLS data and the HCAD tax roll regarding the size of the land and / or building.

For more information, contact Pat O’Connor at 713 822 8613.