home appraisal

About 13,000 taxpayers are expected to protest their appraisals this year, down from about 15,000 protesters last year.

While the Texas Legislature continues debating whether to cap property appraisals, and at what level, in its push for tax reform, McLennan County’s preliminary appraisal values show a slower but steady increase in property values.

According to 2019 McLennan County Appraisal District figures, the appraised value of total properties in the county, including residential and commercial, is $17.95 billion, an increase of 5.8% over 2018 appraisals totaling $16.97 billion.

Wednesday is the initial deadline for most property taxpayers to file an appeal of their appraisals with MCAD. Those who got their notices a bit later have 30 days from the day they received them to file an appeal, MCAD Assistant Chief Appraiser Joe Don Bobbitt said.

As of Friday, 5,364 people had given notice of appeal, down from 6,053 who had filed appeals as of May 10, 2018, when taxpayers saw a 12% median increase in their appraisals, compared to 4.8% this year.

Bobbitt said he expects about 13,000 taxpayers to protest their appraisals this year, down from about 15,000 protesters last year.

“The market is still growing, but not growing as fast as last year,” Bobbitt said. “I believe the reason for the market slowdown this year compared to last year is because the Fed (Federal Reserve) increased interest rates, and when interest rates are increased, that typically knocks people out of the market.”

MCAD figures actually show the 2019 total net taxable appraised value at $18.67 billion. However, Bobbitt said the $17.95 billion figure MCAD released to taxing entities takes into account the millions of dollars worth of valuations MCAD officials estimate will be changed through appeals to the Appraisal Review Board or lawsuit settlements.

MCAD will turn over its certified appraisal rolls to the McLennan County Tax Assessor-Collector’s Office on July 25, but MCAD wanted to give taxing entities estimates of appraised values so elected officials can start preliminary budget discussions.

According to MCAD figures, the city of Hewitt (9%), the city of McGregor (8.7%), China Spring ISD (10.5%) and McGregor ISD (9.6%) had the largest increases in appraised values in the current year.

Bobbitt said the larger increases can be attributed to new subdivisions that were not on the books last year in McGregor and new housing tracts and new businesses in China Spring. Also, homes in McGregor and China Spring that sold in the past year were bought on average for 15% more than their 2018 appraised values, Bobbitt said.

MCAD is required by law to appraise homes and other properties at 100% of fair market value.

In Waco, appraisals increased 5.6%, from about $10.10 billion to $10.67 billion, while appraisals in Waco ISD increased 6.4%, from $5.80 billion to $6.17 billion.

In Woodway, appraisals increased 6% from 2018, from $1.17 billion to $1.23 billion, while Midway ISD increased 4.8%, from $4.75 billion to $4.98 billion.

The residential real estate market is “still very strong” and is still considered a seller’s market. But that is primarily because of the amount of inventory available, said Frances Pool, senior real estate specialist at Keller Williams Realty.

“I think it is leveling off,” Pool said. “Everybody is all worried that there is a shift in the real estate market, but the shift they are talking about is only 3%. It is really just a natural correction. I think we have seen that our sellers are wiser because they price their houses properly and they sell quickly and they usually get about 96% of the asking price if they are priced correctly. And correctly means what the market shows it will bear.”

According to Greater Waco Multiple Listing Service figures provided by Ashton Gustafson, owner of A.G. Real Estate and Associates, the average list price for an area home in April was $219,207, while the average sales price was $212,978, an average of 96% of the list price.

There were 288 single-family homes sold in April, with an average price per square foot of $103. The average home for sale stayed on the market 72 days, according to Waco MLS statistics.

In April 2018, the average list price for a home was $212,235, with an average sales price of $206,611, or 97% of the list price.

There were 285 homes sold in April 2018, with an average price per square foot of $105. Homes for sale stayed on the market an average of 91 days in April 2018.

Pool said she understands why people are lining up to appeal their appraisals at MCAD. She said some houses are selling at below appraised value, including one Pool is listing for $529,000 that MCAD appraised at $625,000.

“It’s a very nice house, but the amount of taxes on a home of that value frightens people, especially if you are afraid your appraisal will go through the roof and you don’t know how much your taxes are going to be,” Pool said. “It’s the fear of the unknown that bothers people.”

Gregg Glime, a real estate agent with Coldwell Banker Commercial, said that while the area is experiencing strong growth, increases in property appraisals and related tax burdens have started to affect rental rates on commercial properties.

“The taxes have increased so much and so drastically that it is really putting a strain on new tenants and making new tenants more concerned and are affecting the rental rates we are getting,” Glime said. “While we are in a strong market and seeing values increase, the increases in taxes have inhibited the rental rates we have been able to get over the last three years.

“Whereas tenants are paying as much or more in rent, it is making it very difficult for the new construction, and even existing properties, to reach palpable rents with these tenants we are working with.”

Glime thinks rental rates will stabilize and the market “will adjust out.” However, he said it is important for property owners to be conscious of appraisals and to ensure they are near fair market value.

“I have seen many that are fair and I’ve seen other properties that have increased so significantly, and I don’t have the data to support some of the values that have come out this year,” he said.

McLennan County Appraisal District values

  2017 values 2018 values change, 2017-18 % (2017-18) 2019 preliminary values change 2018-19 % (2018-19)
McLennan County $15,476,710,204 $16,966,251,291 $1,489,541,087 9.62% $17,954,976,362 $988,725,071 5.8%
—CITIES—
Bellmead $422,737,820 $456,548,836 $33,811,016 8.00% $467,492,714 $10,943,878 2.4%
Hewitt $842,794,668 $936,909,734 $94,115,066 11.17% $1,021,505,557 $84,595,823 9.0%
Lacy Lakeview $339,763,301 $363,195,409 $23,432,108 6.90% $380,935,079 $17,739,670 4.9%
Lorena $111,348,532 $117,815,452 $6,466,920 5.81% $121,943,203 $4,127,751 3.5%
McGregor $361,301,290 $388,606,253 $27,304,963 7.56% $422,460,090 $33,853,837 8.7%
Robinson $786,480,615 $864,871,756 $78,391,141 9.97% $925,563,024 $60,691,268 7.0%
Waco $9,249,863,059 $10,099,447,126 $849,584,067 9.18% $10,665,596,616 $566,149,490 5.6%
West $169,747,546 $182,965,009 $13,217,463 7.79% $193,627,457 $10,662,448 5.8%
Woodway $1,071,816,278 $1,165,499,928 $93,683,650 8.74% $1,234,854,457 $69,354,529 6.0%
—SCHOOLS—
China Spring ISD $692,926,545 $787,819,164 $94,892,619 13.69% $870,478,814 $82,659,650 10.5%
Connally ISD $610,650,280 $665,021,790 $54,371,510 8.90% $702,114,128 $37,092,338 5.6%
La Vega ISD $786,349,725 $882,683,346 $96,333,621 12.25% $922,338,799 $39,655,453 4.5%
McGregor ISD $396,882,314 $414,657,990 $17,775,676 4.48% $454,609,461 $39,951,471 9.6%
Midway ISD $4,407,721,099 $4,747,996,307 $340,275,208 7.72% $4,975,829,535 $227,833,228 4.8%
Robinson ISD $557,008,684 $611,912,747 $54,904,063 9.86% $655,723,071 $43,810,324 7.2%
Waco ISD $5,294,059,798 $5,802,357,927 $508,298,129 9.60% $6,173,852,493 $371,494,566 6.4%
West ISD $375,413,901 $412,156,309 $36,742,408 9.79% $438,236,160 $26,079,851 6.3%

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