So even with tax rates 10-12% lower than last year, owners of many - if not most - El Paso rental homes will face higher property taxes, which likely will be passed on to renters.īut the big impact will be in apartments, where the average valuation is up by 41%. Many El Paso rental homes are seeing increases of 20% or more in taxable value in the past year. That means renters don’t have the same protection as homeowners against rapidly rising valuations. Owners of rental property don’t benefit from any cap on valuation increase, or any added exemption for school taxes. The tax impact on rental properties - and renters That change would lower property taxes on owner-occupied homes. And next month, Texas voters will have the chance to raise the homestead exemption for school property taxes from $25,000 to $40,000. The Legislature in 2019 passed a law requiring school districts to reduce property tax rates when total valuations increase by more than 2.5%. The biggest part of the property tax bill goes to school districts. That means that properties with homestead exemptions will see their city and county property taxes hold steady, or perhaps decline a bit. The reduction in tax rates for the city and county would offset the maximum 10% increase in taxable valuation that taxpayers with homestead exemptions would face.

If the total taxable property value winds up 15% above 2021 levels, state law requires that the city and county governments would have to set a tax rate 10-12% lower than last year to avoid having to ask voters for even more money. That increase will go down a bit as some property owners win protests of their valuation. The total taxable value of property in the county is currently 17% higher than last year, said David Stone, the assistant chief appraiser for the El Paso Central Appraisal District. When total taxable valuation rises, the “no-new-revenue” rate is lower than the prior year rate. State law says the taxable value of property with a homestead exemption (which is separate from the total valuation) can only go up by 10% in a given year.Ĭity and county governments generally can only set tax rates that are 3.5% higher than what is known as the “no-new-revenue” rate without sending the tax rate to voters. If you occupy the home you own and have a homestead exemption, your tax bill this year likely will be flat when compared to last year, and maybe down a bit. But the new appraisals from the Central Appraisal District, and state laws on tax rates and valuations, allow for pretty safe projections. Tax protections for homeownersĮl Pasoans won’t know for sure what property tax bills will look like until this summer, when local governments - city council, school boards, El Paso County Commissioners Court and the El Paso Community College board - adopt tax rates. While state laws protect homeowners from higher taxes due to sharp increases in property valuations, rental property doesn’t have similar protections. Renters across Texas will see rising tax bills adding to their rents because of sudden rises in home prices during the pandemic. And I think if they would really keep that in the back of their mind that they would maybe be more vocal in the political process,” said Lynch, whose organization represents the owners of about 52,000 apartments in El Paso. It’s passed through to them (in their rent). And when people are renting apartments or renting a house, they don’t always think that they pay property taxes, but they do. “We don’t have a lot of political participation in El Paso, very low turnout. Many renters don’t understand how they’re impacted by property taxes, which are controlled by elected officials, said Scott Lynch, executive director of the El Paso Apartment Association. The valuation notices for those properties are going to their landlords, but any tax increase for rental properties likely will show up in tenants’ rent.Īn El Paso Matters analysis indicates that most of the tax increase from rising valuations is likely to be passed on to renters, creating a regressive tax - one which impacts lower-income people more heavily than people with higher incomes.

Instead, the people who should be most concerned about the tax impact of rising property valuations aren’t even getting notices in the mail - the one-third of El Paso households who live in rental properties. Many El Pasoans have been shocked as they’ve opened their new property tax valuation notices and found that their home values have gone up by tens of thousands of dollars in a year.īut their fears of a looming huge property tax increase are likely unfounded, according to an El Paso Matters analysis of the impact of rising valuations. Whoops! There was an error and we couldn't process your subscription.

Rental property evaluator