Here's the funny thing: in many cities, the appraisal district allows property owners to protest the assessed value of their properties. Imagine protesting your income taxes to the IRS! In principle, your job is simple: convince the tax board that your property has been valued too richly, and you may get a reduction in your taxes. The purpose of this primer is twofold: we'll discuss how the appraisal district arrived at a tax value, and more importantly, how you can form an argument that may lower your taxes. (Disclaimer: if you don't get a reduction, don't blame us!)

So simple that it almost seems stupid. But in order to properly formulate an argument which will reduce your taxes, you must understand the difference between the appraisal district's land and structure valuation models.

One thing is obvious: the structure values do not lie on curves. This means that two similar properties that were built in the same year could be assessed differently. The appraisal district may change the assessed value for a property because the house has been improved, or because of a protest.

Generally speaking, notice that newer homes tend to be worth more per square foot than older homes. Still, we can see some "intrinsic scatter" in the newer homes. The scatter could be explained by varying construction quality, varying number of rooms for a fixed square footage, a garage apartment (not counted in home's square footage), or by a protest. However, the appraisal district has no "one-size-fits-all" formula to value a structure; the number of variables is too large. There is a degree of subjectivity involved. If you make a list of comparable properties and find that your house is assessed higher than average, you can make a reasonable argument that your taxes are too high. Luckily, VoxProperty has a nifty property comparison feature. First, find your property. Then, click on "Compare..." (example) to build a custom list of comparable properties.

Notice that most of the homes in this subdivsion were built in the 1940's. Also notice that the scatter among properties of this era is huge ($0-$100 per ft²), much larger than intrinsic scatter alone. This means that in the last 60 years, some properties have changed more than others. Properties inside the green box are immaculate--they're worth almost as much as brand new homes. These structures have likely been fully remodeled in the last decade, and many will have garage apartments and other valuable additions. Moving down in value, we have the cyan box (recent, partial remodel or fairly recent full remodel), pink box (minor or old remodel), the yellow box (no remodel), and finally, the red box (homes with serious structural problems or very successful tax protesters!).

In reality, homes may fall outside the neat clusters we've drawn on the chart. But that's the whole point! Because the condition of a house is pretty subjective, its value is equally subjective. Even if your home has been remodeled, you can convince the tax board that someone else's remodel was more valuable, or that yours is out of date. If your home has structural problems that the appraisal district is unaware of, let them know! They will probably reduce your appraised value significantly.

Unsurprisingly, the appraisal district is not blind to the disparity in values, especially when the market value is lower than the tax value. In terms of structure value, the appraisal district is somewhat blind--they do not send an actual appraiser to look inside your house often, if ever. Thus a long-term property owner could make valuable improvements to a structure without the appraisal district ever knowing, which depresses the tax value. When that owner sells the house for way more than the assessed value, the appraisal district makes an adjustment. Sales prices are really the appraisal district's only way of inferring the improvements made to a home.

But who knows, rules were made to be broken. If you think you paid too much for your home, you can check the recent sales in your subdivision (example) right here on VoxProperty by searching for your subdivision. If you paid too much, the tax board may enjoy your sob story and lower your taxes!

We deduced four rules to win at the property tax protest game:

• Rule #1: Assessed land value is set in stone. There is nothing you can do to change it!
• Rule #2: If your house is above the blue curve, you have a case
• Rule #3: If you have an old house, convince them that it's not very nice
• Rule #4: If you paid too much, you may be screwed

If you'd like to get subdivision-wide charts like the ones used here (including sales data), search for your subdivision. As mentioned above, if you find your property and click "Compare...", you can generate a list of