How to Help Your Clients Save Property Taxes

Property owners come to us because we are the property experts. Our clients are investing in assets that produce a positive cash flow for them with our help. Most clients want us to tell them how we can help them put more dollars into their pockets. What better way to help our property owners retain more of their money than to reduce spending on property tax? Educate your owners on how to file a successful property tax protest to save money, or connect them to a service that you have a vetted relationship with in your market area. Each tax year is independent and current sales will affect the value of real estate. In the Houston market, when taxes go without protest, the taxable value will incrementally increase annually.

A successful protest is a thoughtful debate based on two factors: unequal value compared to other properties in the area or over-market value.

The district in Harris County, Texas will allow roughly 115 words to contend why real estate is improperly valued. This is two very short paragraphs. Pick some points and validate them. Include supporting evidence: pictures of the unimproved property and a market analysis from your neighborhood property manager. Most districts even allow for an online protest option. It is helpful to think like a potential home buyer and ask, “Why would someone not purchase this
property?” Highlight the unfavorable attributes. Negative influences on single family residential real estate can include busy streets or a nearby power plant.

I will present a real life example. The subject property is located at a heavy traffic intersection in a large tract of residential single-family homes within the community. Any resident that enters or leaves the community in a vehicle will shine headlights into the residence which largely affects the quality of life for the occupants. The subject property also has an antiquated kitchen and no major interior updates. Based on the sold comparables of homes possessing similar interior conditions, the subject property reflects a range of $76-$84 dollars per square foot. The subject property should be assessed on the lower range based on the geographic position in the neighborhood.

Most appraisal districts will generally provide a response to the proposed value online within 45 days of your protest. If you disagree with the value they suggest electronically, then owners can protest their case among an in-person panel. It is
also important to communicate to your owners that the protest of property taxes does not open them up to any sort of retaliation. It is a normal process of real estate and taxing districts.

If the case escalates to a panel, practice rehearsing your contentions. It is important to dress professionally, be respectful, and bring multiple copies of all supporting evidence for the panel members to review.

Providing this sort of information to your clients will make you an even more valuable asset to their investment.

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