Property tax assessments are based on the property value on January 1. The median home price for Galveston County sales in January 2023 is $298,900 but the median tax assessment by Galveston Central Appraisal District is $338,290, 13.2% higher than the median January sales price. Tax assessments far higher than median sales prices will generate excess property taxes for Galveston County home owners of $1,064, before tax protests, exemptions, and tax rate compression.
The typical home in Galveston has a 2023 tax assessment 12.5% higher than its market value based on a survey of 7,900 Galveston County home sales from January 2022 to March 2023. Home prices had been steadily increasing at a brisk pace, until May 2022.
Galveston County median home sale prices were $305,000 in January 2022 and crested at a peak of $353,000 in May 2022, fully 15.7% higher than the January 2022 level. However, the unrestrained enthusiasm for continually higher home prices was crushed by higher interest rates which rose from about 3% in early 2022 to 6%+ by year-end. After reaching a peak of $353,000 in May, prices fell 15.3% to $298,900 in January 2023, 2.0% lower than January 2022 median price of $305,000.
The greater Houston metro area recorded an increase of 1.6% from January 2022 to January 2023. Since the Galveston County median home price fell by 2% from January 2022 to January 2023, it would be reasonable to expect tax assessments to fall by 2%. Galveston Central Appraisal District instead raised home tax assessments by 23.8% for 2023, leaving a gap of 25.8% between the 2% decline in value and the 23.8% increase in tax assessments.
The Texas Tax Code (23.01) is clear that tax assessments should have an effective date of January 1 of the tax year. Hence, the tax assessment for tax year 2023 should be the value as of January 1, 2023. However, the gap between the median home sale price of $298,900 in January 2023 and the median 2023 tax assessment of $338,290 illustrate taxes will be substantially too high unless protested.
O’Connor has reviewed sales data and tax assessments for 15 counties to date and 13 counties issued assessed values for homes in excess of market value based on reviewing all sales in the county.
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Galveston County homeowners with property between 6,000 and 7,999 sq. ft. are facing assessment increases of 34.9% and owners of homes over 8,000 sq. ft. are looking at values up by 35%.
Older homes are casualties of the highest surge in assessment with residential property built before 1960 up by 30.6%.
Galveston County homeowners of property valued at $1.5M or higher see the steepest assessment increase at 39.6%.
Galveston Central Appraisal District raised assessed value for commercial properties by 20.9%, which is at the lower end of the range compared to most appraisal districts review to date. GCAD raised tax assessments for apartments by 34.5% and for retail by 37.8%. Office tax assessments were increased 5.1% and warehouse values were flat.
Retail property and Apartments are among commercial properties with the most staggering elevation in assessments at 37.8% and 34.5% respectively.
Commercial Property 2023 Assessment % Increase by Property Type by County
| Property Type | ||||||
| County | Apartment | Office | Retail | Warehouse | Hotel | Total |
| Brazoria | 68.8% | 43.7% | 75.1% | 83.7% | 42.7% | 65% |
| Bexar | 22.5% | 13.9% | 26.2% | 22.9% | 16.9% | 21.9% |
| Collin | 45.5% | 15.1% | 25.2% | 28.0% | 49.6% | 31.7% |
| Denton | 63.0% | 28.7% | 33.3% | 103.4% | 63.6% | 60.1% |
| Fort Bend | 47.0% | 33.2% | 35.7% | 23.8% | 19.3% | 31.1% |
| Galveston | 34.5% | 5.1% | 37.8% | 0.6% | – | 20.09 |
| Hidalgo | 58.3% | 9.6% | 18.4% | 31.2% | 70.6% | 25.1% |
| Lubbock | 28.9% | 13.7% | 28.7% | 40.4% | 26.3% | 23.30% |
| Nueces | 20.1% | 15.4% | 14.5% | 18.9% | 26.9% | 18.7% |
| Williamson | 37.2% | 14.5% | 21.8% | 49.3% | 25.0% | 27.3% |
| Harris | 24.5% | 12.6% | 16.1% | 23.8% | 18.3% | 19.5% |
| Average | 40.9% | 18.7% | 30.3% | 38.7% | 35.9% | 31.4% |
O’Connor expects a record number of protests in Galveston County and most other Texas counties due to the excess assessment of houses and the high level of increase in commercial property assessments.
Commercial property in Galveston County valued over $5M is subject to the largest jump in taxable value of any value range with 2023 values up 24.2%.
The highest increase in assessed value for Galveston County commercial property is with property constructed since 2001, up 26.7%.
All Time Texas Record
Not since Texas became a state in 1845 have most appraisal districts substantially over-valued houses. Most appraisal districts for which assessment data is available have over-valued houses by 5% or more, often by 10 to 20% more than market value. Tax rates can compress due to SB 2 passed in 2019. However, home owners WILL BE PAYING MORE THAN THEIR FAIR SHARE UNLESS THEY PROTEST IN 2023. The protest deadline is May 15, 2023.
Newer apartments in Galveston County are by far the most impacted by 2023 assessment values with a rise of over 58%.
Galveston County office property owners with property built between 1961 and 1980 are seeing the highest increase among all ranges.
Retail property owners in Galveston County have sticker shock when viewing their 2023 assessed values that are up by over 100%!
Galveston County warehouse property with the highest increase in assessed value according to age is property constructed between 1981 and 2000, at 19.2%.
Mall property has a 46.7% increase in assessed value for 2023, which is the greatest increase among all retail property sub types.
Mini warehouse properties in Galveston County are up 54.2% in assessed value for 2023.
The protest deadline is May 15, 2023. Protest now to be certain you don’t miss the deadline. There are three steps to the appeal process: informal, formal or appraisal review board, and judicial. O’Connor expects record reduction in Galveston County tax assessments for 2023.
If you are a property owner in Galveston County and your assessment has increased, 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.
