Factual Background:
| Median Home Sale Price in January 2023: | $420,000 |
| Median Home Assessment for 2023: | $465,748 |
| Excess Assessment over Market Value: | $45,748 |
| Extra Property Taxes at 2.7% | $1,235 |
The typical home in Denton County has a property tax assessment 10.2% higher than its January 2023 market value. Texas Tax Code is clear that property is to be valued as of January 1 of each year
Denton County home prices spiked 21% from $420,000 in January 2022 to $507,500 in May 2022, based on a study of 15,123 Denton County home sales during January 2022 to March 2023. After spiking during the first part of the year, prices tumbled 17% back to $420,000 in January 2023.
Assessment Increases versus Market Value Increases
O’Connor’s analysis shows a 0% increase in Denton home sales prices while the North Texas Association of Realtors® report a 3.9% increase for the Dallas Fort Worth metroplex. However, Denton County Appraisal District increased assessed values for homes by 28.4% for tax year 2023. Consequently, 86% of Denton County houses are valued at more than 100% of market value while 14% are valued at market value or lower.
Denton County Appraisal District is not alone in over-valuing houses. Following is a summary of tax assessments for houses in 15 counties; 13 over-valued houses.
| County | Median Level of Assessment | Median Sales Price (1) | Median 2023 Tax Assessment | Extra Taxes Due to Over Assessment (2) |
| Brazoria | 111.8% | $280,000 | $333,830 | $1,453 |
| Bexar | 104.6% | $282,073 | $297,325 | $412 |
| Collin | 101.9% | $490,000 | $498,759 | $236 |
| Denton | 110.2% | $420,000 | $465,748 | $1,235 |
| Fort Bend | 108.1% | $370,040 | $402,442 | $875 |
| Galveston | 112.5% | $298,900 | $338,290 | $1,064 |
| Harris | 116.2% | $275,008 | $322,400 | $1,280 |
| Hays | 101.3% | $432,250 | $436,660 | $119 |
| Hidalgo | 107.4% | $200,000 | $210,346 | $279 |
| Lubbock | 97.7% | $235,000 | $229,814 | ($140) |
| Montgomery | 103.5% | $321,250 | $335,680 | $390 |
| Nueces | 122.7% | $229,500 | $282,915 | $1,442 |
| Travis | 111.8% | $500,000 | $563,156 | $1,705 |
| Webb | 101.7% | $201,450 | $205,688 | $114 |
| Williamson | 96.7% | $428,595 | $417,498 | ($300) |
| (1) Time adjusted sale price as of January 2023 |
| (2) Extra taxes based on 2.7% tax rate and before homestead exemption and tax rate compression, |
Denton County residential property over $1.5M have shown the sharpest increase in assessed value at 42.8%.
Homes in Denton County with the greatest assessment increases are houses with between 6,000 to 7,999 sq. ft. at 39% increase and houses over 8,000 sq. ft. at more than 35% increase in assessed value.
Denton County property owners with homes built since 2001 have a 31.9% rise in assessed value, the most among all ranges.
Denton County commercial property owners are also in shock based on the 2023 tax assessments issued by Denton Central Appraisal District due to increases of over 60%! These large increases are incongruent with the large drop in commercial property values during 2022. A large increase in interest rates led to a large increase in cap rates, which caused commercial property sales to plummet by 70 to 80%. Buyers are keen to buy at a much lower price by sellers are on the sidelines until there is clarity regarding whether the higher cap rates are temporary or not.
Warehouses suffered the largest increase in value (103.4% increase in 1 year) followed by hotels (63.6%) and apartments (63%).
The protest deadline is May 15 for both residential and commercial property owners. These gargantuan increases in tax assessment will be used to calculate 2023 property taxes unless they are protested. Property owners are encouraged to file a protest and also ask the Denton County Appraisal District to mail hearing evidence to them. It is available at no cost upon request to those who protest.
| Property Type | 2022 Final Market Value | 2023 Notice Market Value | increase% |
| Apartment | $12,690,027,839 | $20,686,237,400 | 63.0% |
| Office | $4,848,886,645 | $6,238,332,261 | 28.7% |
| Retail | $3,911,688,486 | $5,214,627,399 | 33.3% |
| Warehouse | $6,660,715,709 | $13,545,848,510 | 103.4% |
| Hotel | $556,854,932 | $911,081,988 | 63.6% |
| Land | $6,464,468,615 | $9,646,516,919 | 49.2% |
| Total | $35,132,642,226 | $56,242,644,477 | 60.1% |
Commercial property owners of property over $5M in value are shocked to see their taxable value skyrocket by 68.5%
There is a clear trend in assessment increases going up with more recent construction. Denton apartment properties built since 2001 are the hardest hit with assessed value increases of 69.4%.
In contrast to apartments, office properties in Denton County with the steepest rise in assessed values at 68.9% are for properties built between 1961 and 1980.
Retail commercial property in Denton County show less variation by age range but are all significantly up in assessed value at between 21.7 and 36.4%.
Denton County warehouse owners see a very similar picture as apartment owners, but with even more staggering increases. Warehouse property is up in assessed value by over 110%!
When comparing offices, apartments, retail, and warehouse properties by sub-type, the fact that stands out the most is that there are increases across the board. However, malls, a sub-type of retail commercial property, show some of the most significant increase in assessment at 78.8%.
Both residential or commercial property owners in Denton County and in many other counties across the state of Texas are seeing enormous increases in assessed value. Remember, you do not have to accept the new appraisal value, it is your right to appeal. Don’t pay more than your fair share. Record levels of property tax protest are expected to follow. The deadline to file a property tax protest is May 15th.
About O’Connor:
O’Connor is among the largest property tax consulting firms in the United States, providing residential property tax reduction services in Texas, Illinois, and Georgia, as well as commercial property tax reduction services across the United States. O’Connor’s team of professionals possess the resources and market expertise in the areas of property tax, cost segregation, commercial and residential real estate appraisals. The firm was founded in 1974 and employs more than 600 professionals worldwide. O’Connor’s core focus is enriching the lives of property owners through cost effective tax reduction.
Property owners interested in assistance appealing their assessment can enroll in O’Connor’s Property Tax Protection Program ™ . There is no upfront fee, or any fee unless we reduce your property taxes, and easy online enrollment only takes 2 to 3 minutes.
