home appraisal

Home sales and their prices are contributing to rising property values across McLennan County.

Though local government officials have touted declining or flat tax rates in the past month, many McLennan County homeowners will see their tax bills soar by hundreds of dollars.

Home values are generally up countywide yet again, according to the McLennan County Appraisal District. As home values increase, taxing entities including cities and school districts collect more from property owners without raising their tax rates.

The China Spring ISD board lowered the district’s tax rate by 3 cents per $100 of property value, but the average school tax bill will be more than $200 higher than last year.

Midway ISD’s tax rate remained the same, but taxes on an average-value home will be up $238.

Each resident’s property tax burden varies depending on location and how city and school tax boundaries overlap.

Woodway’s city council approved a 2-cent tax rate decrease, but the average home’s Woodway city tax bill will increase by $37.

“The 2 cents tax decrease that the council gave is not a lot of money for some people, but for others it is,” Woodway Interim City Manager John Hatchel said. “And the council is just trying to give the citizens a little bit of a break due to the home values going up as much as they did. But even with the tax break, the way they have gone up, we are still generating as much money as we did before.”

The state requires any entity expecting to collect more in property taxes than the year before to advertise its proposed tax rate in official public notices as a tax increase, even if the tax rate itself is decreasing.

In Waco, an average-value home’s city tax bill will increase by $100, although the city’s tax rate stayed the same.

Waco Assistant Manager Bradley Ford said essential city services come at a cost, and the city’s tax revenue is well managed.

“With that funding, we do quite a bit of work for (Waco residents) to ensure that they have public safety, parks, libraries as well as a host of other services,” Ford said. “Certainly we’re concerned with people not being able to afford their houses, but our main focus is on what we can control as a city, which is providing efficient services and keeping up with the services that citizens expect.”

Property tax increases, in spite of stagnant tax rates, are part of a yearslong trend. In the past five years, the overall value of homes grew 34 percent countywide.

Some industry observers have said the inflated cost of home ownership is a red flag for the area, a sign of an increasingly unhealthy housing market.

Last year, Nationwide Insurance ranked Waco as one of the 10 least healthy housing markets in the nation, because of a toxic combination of quickly rising home prices, slow wage growth and stagnant employment growth. At that time, half of the 10 housing markets on the list were in Texas.

An update to the report shows the local market saw no significant change in those factors between the first and second quarters of the year.

The appraisal district bases a home’s value on historic trends, so when more people frequently pay an “exorbitant” amount of money for homes, the appraisal district must adjust home values appropriately, Assistant Chief Appraiser Joe Don Bobbitt said.

“Right now we’re seeing a lot of increase, and whether it is justified I don’t know, but I mean people are paying it,” Bobbitt said. “So one person pays it, so that justifies the next person paying, so it’s like a vicious cycle.”

But the district’s role is only to appraise at market value, not analyze where the market should be or its effects on residents. Its hands are tied by the Texas Comptroller’s Office, he said.

“What we do is directed by law,” Bobbitt said. “The comptroller comes and audits us this year to look at our numbers to make sure we’re not off too far. If we get one or two percent off the school district loses money. We don’t have a lot of flexibility.”

As the market continues to ascend, Waco homeowner Phillip Bridgewater worries the working poor will be priced out of home ownership and eventually, McLennan County.

“I don’t want to make it as they (MCAD) are some horrible monsters,” Bridgewater said. “I work in housing. I watch national trends. Every municipality is fighting for every dollar. Waco is no exception.”

But through Bridgewater’s work for Habitat for Humanity International, a nonprofit that builds houses for low-income families, he sees a disturbing trend of tent cities popping up in metropolitan areas.

“We need to be creative or else we’re going to create things like I saw in Portland. (Property tax appraisals) have no basis on the income of the occupant,” he said. “It’s a gentrification project. They are going to push out their poor.”

The appraisal district is aware of the impact rising property values could have on poor residents, Bobbitt said.

“We realize sales are outpacing people’s income. … We know that the market is outpacing wages, and at some point, it is going to become a problem,” Bobbitt said. “But that’s the trend we’re seeing in our area.”

The only surefire way to control rising home values is for each individual to contest the district’s proposal if they think it is unfair, Bobbitt said.

“April through May 15, that’s when they (property owners) are supposed to protest,” he said. “That’s when we want them to, because if people have an older house there may be a lot of stuff going on that we are not aware of.”

Appraisers consider the upkeep and maintenance required for older homes and usually will adjust a home’s value accordingly, he said.

In May, Bridgewater spoke to the Tribune-Herald after MCAD raised the value of his turn-of-the-century home in the Sanger-Heights neighborhood, an inner-city area with a high poverty rate, from $140,000 to $331,000. He protested the appraisal hike and was able to cut his home’s preliminary appraised value in half, to $170,000.

Still, he will face a tax hike of about $800 in combined city, county, school and college taxes, for a total of $4,777.

Bridgewater said he worries residents with less education may not know how to start the appraisal protest process.

In the future, the state’s appraisal methods need to account for low-income homeowners, Bridgewater said.

“We’re not against taxes, but you can’t come down unilaterally on people making under $100,000,” he said. “Chip and Joanna (Gaines), they don’t represent Waco.

“I’d like the smart and compassionate people in Waco to talk about how not to become like a Dallas, Fort Worth or an Austin. We’re going to continue to grow, but how do we manage growth while being compassionate to our workforce and our poor. … I feel like we have hope in Waco, but we’re going to have to be smart about it.”

The window to contest home values this year has closed, and although many homeowners successfully lowered their skyrocketing home values this spring, those who didn’t also must pay property taxes in full by Jan. 31.

McLennan County Tax Burdens

* Per $100 valuation. Some numbers have been rounded. // Source: McLennan County Appraisal District

  Tax Rate*
2017
Tax Rate*
2018
Tax Rate*
+/-
Total Taxable
2017
Total Taxable
2018
Total Taxable
+/-
Avg. Taxable Home
2017
Avg. Taxable Home
2018
Avg. Taxable Home
+/-
Avg. Tax Bill
2017
Avg. Tax Bill
2018
Avg. Tax Bill
+/-
McLennan County $0.5053 $0.4853 ($0.02) $15,476,710,204 $16,947,709,721 9.50% $122,501 $133,390 8.90% $618.99 $647.33 $28.34
Waco $0.7762 $0.7762 $9,249,863,059 $10,099,447,126 9.20% $129,349 $142,235 10.00% $1,004.05 $1,104.07 $100.02
Hewitt $0.5397 $0.5397 $842,794,668 $936,909,734 11.20% $134,849 $146,281 8.50% $727.75 $789.44 $61.69
Woodway $0.47 $0.45 ($0.02) $1,071,816,278 $1,165,499,928 8.70% $237,687 $256,630 8.00% $1,117.13 $1,154.84 $37.71
Bellmead $0.30 $0.32 $0.02 $422,737,820 $456,548,836 8.00% $72,445 $79,531 9.80% $217.33 $254.50 $37.17
Robinson $0.4945 $0.4845 ($0.01) $786,480,615 $864,871,756 10.00% $169,822 $183,754 8.20% $839.77 $890.29 $50.52
Lacy Lakeview $0.3526 $0.3526 $339,763,301 $363,195,409 6.90% $97,728 $105,845 8.30% $344.62 $373.24 $28.62
Waco ISD $1.41 $1.4041 ($0.0059) $5,299,274,784 $5,802,357,927 9.50% $84,630 $95,842 13.20% $1,193.28 $1,345.70 $152.42
Midway ISD $1.32 $1.32 $4,417,327,907 $4,747,996,307 7.50% $192,084 $210,117 9.40% $2,535.51 $2,773.54 $238.03
China Spring ISD $1.3872 $1.3587 ($0.0285) $695,413,727 $787,819,164 13.30% $183,091 $201,823 10.20% $2,539.83 $2,742.21 $202.38
La Vega ISD $1.4135 $1.3940 ($0.0195) $786,514,823 $882,683,346 12.20% $54,941 $63,016 14.70% $776.61 $878.47 $101.86
Robinson ISD $1.4061 $1.4063 $0.0002 $558,877,649 $611,912,747 9.50% $148,035 $162,095 9.50% $2,081.57 $2,279.57 $198.00
MCC $0.1503 $0.1577 ($0.0027) $16,550,939,331 $18,062,707,293 9.10% $122,277 $133,189 8.90% $183.84 $196.71 $12.87

Lauren Dodd has covered education for the Tribune-Herald since May 2018. A native of Beaumont, Dodd attended Rhodes College and joined the Tribune-Herald in 2018. She previously worked as a reporter at the Seguin Gazette and the Killeen Daily Herald.

Recommended for you