Do Tax Appraisals Decline?
Can tax appraisals decline? Absolutely! Its been a while since home prices have declined in Central Texas, so we’ve only seen property tax appraisals increasing each year. But as we come into the final stretch of 2022, it sure looks like prices will finish the year lower than where they started. Not by much, but by a little. So when the appraisal districts look at the 2023 values, there will likely be small declines. However, if you’ve had a homestead exemption in place and benefitted from the 10% cap this year, your taxable value will still increase because you’ve got some catching up to do. Let’s look at an example: if you were at $400,000 in 2021, you were probably appraised around $550,000 in 2022 but the 10% cap means you’ll be paying based on $440,000. Next year, say it declines slightly to $540,000, you’ll still be catching up so you’ll be paying based on $484,000. So while the values may go down for people, it won’t impact many who have a homestead.