| Property Taxpayers Lose Either Way |
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| by Tom Pauken | Mon, Mar 3, 2008, 01:07 PM |
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The Dallas Morning News had a story last Friday about heavy levels of foreclosures in certain residential neighborhoods where property values are plummeting. The News article quotes a U.S. Senate study which found that “ Logically, that should mean appraised values on residences in When property values were rising in neighborhoods where there were a lot of “teardowns of old homes and replacements by “McMansions”, those in the old homes in these neighborhoods saw huge increases in the appraised value of their property even though they hadn’t done anything to improve their property. Why shouldn’t foreclosed properties be included in comparable sales to get a fair market value of one’s home in this new environment of declining house prices? With a number of foreclosed properties in a neighborhood it is bound to impact the selling price for those homeowners who may want to sell their homes at this time. It seems like appraised values of homes tend to be too high in a rising home market and are not low enough in a falling market under our current appraisal system. Property owners lose either way by paying more in property taxes than they should.
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Comments (8)
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written by Old Red , March 03, 2008 Perhaps a new County Tax Assessor-Collector is called for.......
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written by Tom Pauken , March 03, 2008 Old Red, you are letting your partisan slip show again. The County Tax Assessor-Collector (who happens to be the Republican, David Childs) has no authority in this county when it comes to appraising property values. In a few counties in Texas, the County Tax-Assessor-Collector does have that authority, but not Dallas County. Here, appraised values are assessed by the Dallas Central Appraisal Board, whose Board is 100% appointed by the local taxing entities. To me, that is an inherent conflict of interest which leads to some of the problems we have with the appraisal process in Texas.
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written by Dallasite1 , March 04, 2008 Face it, we need to abolish the property tax. The current system has an inherent flaw that simply cannot be overcome. That is, no matter what you do, no matter your income, or what you paid for your property, you can be taxed out of it if your neighborhood improves. We should get rid of the property tax altogether, and expand the sales tax to offset the loss in revenue to the various entities.
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written by Byron George , March 04, 2008 Tom, your partisan is showing again. Please tell me what part the Dallas Central Appraisal Board plays in valuing property? You are correct in one point. In a normal market foreclosed property is not used in valuing property. It is also true in a normal market a fee appraiser would not use a foreclosed property in doing an individual appraisal on your property for home equity purpose, etc. When the market takes a hit and you have many foreclosures, the Central Appraisal District will take into consideration these foreclosed sales. Your quote, "It seems like appraised values of homes tend to be too high in a rising home market and are not low enough in a falling market under our current appraisal system" is very misleading. I've ask you this question before but got no response. Considering that State Law and the Texas Constitution mandates that property in Texas be valued at it's market value, do you think property in Texas is overvalued by the appraisal districts? If you believed that you would have supported mandatory sales disclosure that your own Task Force recommended. Property values will never be totally fair and equal without disclosure. IF, as you constantly insinuate, that the appraisal districts are so corrupt you should contact Dave Montoya at the Board of Tax Professional Examiners and make a formal complaint. You are obviously an intelligent man and I suspect that you cannot say with a clear conscious that your property is overvalued.
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written by Tom Pauken , March 05, 2008 Byron, if you don't think that the Comptroller property value study (which mandates that all property be appraised within a five percent margain of error) puts pressure on the local appraisal districts to appraise some properties at more than 100 percent value in order to get within that 5 percent variance and if you don't believe that appraisal boards totally controlled by local taxing entities have an effect on valuations, then it is hard to have a rational discussion on the subject with you. Yes, I do believe that a lot of property in Texas is appraised above what a seller could net were he to put his property on the market. I am not saying the appraisal district folks are corrupt. There are many nice people whom I have met who work for various appraisal districts. But, I believe that the system is such that it results in certain distortions. Mandatory sales disclosure without true appraisal reform, including independent appraisal boards and giving voters a say when property taxes go up more than 5 percent annually, will do nothing except to push property taxes up higher. As part of an overall reform of the system, I am in favor of it.
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written by Byron George , March 05, 2008 Tom, I am well aware of the Comptroller property value study and its margin of error. I also understand the near impossible task that has been put on appraisal districts. They receive information on about 20% of the sales values and have to use these 20% to value 100% of the property. I have said all along that taxpayers should have more of a say when property taxes go above 5 percent annually. The key to this is already in place. The Effective Tax Rate generates the same amount of revenue as the previous year using the current appraisal appraisals. How many people do you think come to an appraisal district to "protest their taxes?" It's not the appraised value that people disagree with, its the tax amount which the appraisal district cannot change. Tom, our disagreement is not that far apart. I happen to know that mandatory sales disclosure is necessary for fair and equal appraisals and would allow both taxpayers and appraisal district to be more comfortable with the appraisals. If you believe properties are appraised above market, how could mandatory sales disclosure increase the values. Seems it would have just the opposite effect. With disclosure, taxpayers would have more comparable sales to use to prove their property is overvalued. I must disagree on the appraisal board. I would be for a district judge appointing the CAD Board of Directors. I don't think elections are the answer. What platform would a person run, "I will not allow the cad to raise your value?" Under current law, the CAD BoD have no part in valuation of property. If they are "forcing the chief appraiser to raise values they are violating the law and they should be investigated and removed.
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written by Smithy , March 14, 2008 If we tax payers are always complaining, then why do we keep re-electing David Childs as the tax assessor & collector for Dallas County. Interesting to note that David Childs was first elected by the Dallas County voters in November 1988 and sworn into office in January 1989. David Childs was re-elected in 1992, 1996, 2000 and 2004.
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written by Tom Pauken , March 14, 2008 Smithy, David Childs has nothing to do with our local property taxes constantly increasing. The problems are with the local taxing entities which consistently increase spending above levels of inflation plus population growth. In addition, the appraisal boards are completely controlled by the local taxing entities. They need to be independent. David Childs has nothing to do with either of these problems which Old Red surely knows. Write comment
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