Texas Residents Decry 'Outrageous' Property Tax Rises

Many Texans are still struggling with high property taxes months after the state's Republican governor Greg Abbott signed into law a tax relief package that should have lower rates.

Jerry Sonnier, a Texas resident, told Newsweek that last summer "all the appraisal districts" raised property values "to counteract the 'relief'," leaving residents facing higher taxes despite the new package.

"We saw an actual increase in property tax paid in 2023 vs 2022, even after we got our 'relief', so it is all a bunch of smoke and mirrors," Sonnier said of the tax relief package.

In July 2023, Abbott signed into law an $18 billion property tax relief package for Texas homeowners, the Property Tax Relief Act. Under the new legislation, which was backed by residents at the November 7 ballot, local governments are to stop applying property taxes, and the state government steps in for the lost revenue.

The bill raised the homestead exemption—the amount of money a homeowner can take off the value of their primary residence before it is taxed—from $40,000 to $100,000 per year. It also put an appraisal cap on residential and commercial properties and included a public school tax compression, reducing school districts' maintenance and operations property tax rate by 10.7 cents per $100 of a property's valuation.

Susan Jebbia, another Texas resident, agreed with Sonnier that property taxes rates have gone up in recent months.

"My taxes actually went up due to the fact that the County in which I live did its due diligence and raised all of the homes up to the 10 percent cap limit, knowing fully well that Texas voters would welcome the 'tax relief'," she told Newsweek.

"It's a pretty sad state of affairs when lifetime citizens of Texas can no longer afford their homes due to outrageous taxes that exceed their limited incomes," she added. "Bring on a state income tax and lower property taxes, for God's sake. Fair market value is simply ridiculous for individuals who bought homes 30 years ago, paid them off in full, but are unable to live out their lives in their lifetime homes due to Texas' outrageous and ridiculous property tax laws!"

Jebbia said her property taxes have increased despite the fact that she required her homestead exemption, an option that's allowed in some areas of the state for those over the age of 65. The homestead exemption only applies to properties considered as primary residence.

It's important to understand how property taxes work in the Lone Star State. Texas, unlike most U.S. states, does not have state-imposed property taxes. Property taxes are, instead, collected by local tax units which use that revenue to pay for schools, streets, roads and police and fire services, among others.

When a majority of Texans voted to lower property taxes in the state last year, they actually voted for local school districts to lower their taxes and have the state make up for their lost revenues.

Texas resident W. Greene does not have the same negative outlook on the situation as some of his fellow Texans. Greene told Newsweek that "even with higher property taxes, most homeowners pay less in taxes than if they had a similarly priced home in a state with income taxes." He thinks that the main reason property tax rates have gone up is that the value of homes has recently skyrocketed.

Houston resident Pamela Clark Schneider told Newsweek that her husband used to own a property in the city which had been in the family for the past 80 years.

The 1,000 sq feet property, including a two-bedroom bungalow house with one bathroom, was valued at $500,000 a few years ago, despite the fact that Clark Schneider said it had multiple flaws—including no insulation, a small backyard and a garage that was too tiny to park a modern car.

"The house was valued at around $38,000 but the rest of the value was in the land," she said. "You can argue the price of the house, but the land values are pretty much fixed. Any time we protested the value we were told it was valued appropriately for the neighborhood."

In 2017, Clark Schneider's husband made the "sad choice" to sell. "We could not see investing more money to fix the house, only to see our taxes rise even further when it was a large bite out of retirement already. In another couple of years only the very wealthy will be able to live in the inner city in Houston. It is like being forced to pay capital gains on an investment before you realize the gains."

Clark Schneider and her husband now own a commercial piece of property in Harris County. "Our taxes went up 24.5 percent this year," she said.