By Jonathan Kutner
When the Dallas Central Appraisal District mailed its 2021 taxable value notices on April 16 many Dallas homeowners received a big surprise. A second surprise awaits.
Rising property taxes are the flip side of rising values. When some of those owners protest their increased taxable values to the Appraisal Review Board they may have difficulty because home values have skyrocketed in 2020. So comparable sales will not be as effective this year as they have been in the past.
But in an up market there’s a second way to protest and this one doesn’t require comp sales. It’s called Unequal Value and is a statistical rather than a market based argument. It applies especially to higher value properties because when successful it results in a percentage reduction below market.
Homeowners can expect better results if they include Unequal Value (comparable assessments) as one basis for their protest rather than citing only Value Over Market (comparable sales). But most protests overlook Inequality.
Last year only about 10% of the 180,000 residential property protests filed in Dallas argued Unequal Value before the ARB.
Inequality applies especially in times like these when comparable sales are a difficult case to make.
If your home is fairly assessed at market but a representative sample of other properties appropriately adjusted are assessed at 85, 90, 91, 92 and 94 percent of market, then you qualify for a 9 percent reduction. The key is the sample and the adjustments.
When successful Inequality always results in an assessment below market because it’s applied after market value is determined by the ARB. But it’s complex and requires good supporting data. We’ve been doing it at Property Tax Protest for a long time.
Since Inequality is a statistical argument it’s important to file whether you consider your proposed assessment fair or not.
The filing deadline this year is May 17 this year because thirty days after DCAD’s mailing would be a weekend.
Jonathan Kutner, owner of Property Tax Protest has been a developer and investor in real estate in Dallas for many years. He lives with his wife in Uptown.