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Residential Property Tax Protests

DFW area home sales as of late 2012 were up more than 10% from a year ago in an estimate done by the S&P Home Price Index.  Now at the end of 2012 Dallas residential home prices had its biggest gain in 5 years with an increase of 9.7% in the median sales price of pre-owned homes from this time last year.  Dallas home prices have been more stable than other cities.  Existing homes sales are down to the low inventroy levels.  This is a broad brush and property value should be examined by sales comparables within your specific submarket or neighborhood.  An analysis of sales of like kind with property characteristic adjustments must be utilized to obtain an indication of fair market value.

In a property tax appeal a second protest which is different from fair market value can be filed also named a "Fair and Equal" argument.  This is a sample of like property tax assessments appropriately adjusted to the subject to indicate a median level of value.  Should a conflict between the "Fair and Equal" value and market value take place, the "Fair and Equal" valuation should preside.








Commercial Real Estate Property Tax Protests

Property owners in the Dallas Fort-Worth area have been enjoying the demand for rental space as rental rates continue to increase.  Demand for higher end office space continued to grow from the 3rd quarter to 4th quarter of 2013.  Office Space Leasing: Net leasing of office space was up 15% from 2012 to 2013.  Vacancy Rates have dropped to the lowest in the past 10 years at 18%. Drop in Burbs: Office submarkets have dropped below 10%: North Dallas, Frisco and West Plano. 587,000 square feet of office space was absorbed over a three month period equating to a total of more than 1 million square feet this year.  Overall occupancy rates for all classes of office space are above 80% for the area and this is the highest it’s been since 2009.  This type of Class A product for space is expected to grow and to increase the overall occupancy.  With this expect rental rates to increase and concessions to decline.  It does seem that the market is on an upswing and the market tightening up.  Fort-Worth Class A office space is now 96% occupied.  Contributing to this are positive indicators of job growth for the region and corporate relocation to North Texas.








Property Tax Protests Using Foreclosure Sales

There has been a decline in foreclosure sales in North Texas and this will most likely continue through 2012.  Filings are down about 26% for January 2012 in the DFW Metroplex from one year ago.  This is the biggest decline in more than 2 years.

How does foreclosure sales effect market value and a property tax protest?  Per the Texas Property Tax Code the appraisal must meet 100% of market value.  If the majority are foreclosure sales, one would use these in arriving at market value of the subject property.  Appraisal districts typically do not want to use foreclosure sales but the code does state that they must be considered.  This is vague and open to interpretation.  In my opinion for a property tax protest, one should use foreclosure sales when it meets the requirements covered prior.




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