Most Shelby County Property Owners
Will See Increased Valuations for 2022
Shelby County is experiencing increased growth regarding real estate values. The Comptroller’s office through its Property Tax Division recently conducted their Property Value Study which takes a random sample of properties within a school district and then through reported sales and their field appraisals, they determine whether the Appraisal District is valuing properties at 100% market value according to state law.
The 2021 Property Value Study (PVS) determined that the Shelby County Appraisal District (Shelby CAD) was not valuing properties at 100% market value. The PVS determined that 5 out of 6 schools were outside the realm of acceptability. The appraisal districts were created to ensure equitable value for school districts statewide. So when the state determines the local appraisal district is undervaluing properties, it affects the amount of state funding the local school districts receive.
Shelby CAD receives returned mail on less than 2% of the optional sales letters that are mailed out to both the buyers and sellers of all deeded real estate transactions. Shelby CAD previously received multiple listing sales information from our local board of realtors but was cut off from receiving sales information in 2015 by the local board. The state comptroller still receives sales information that they use in their property value study, but the CAD only has access to the sales information after the school districts fail the Property Value Study.
The state property value study is conducted every two years unless a school district fails the study and then PVS is performed each year until the school district passes. Shelby CAD passed the 2019 study for 5 out of 6 school districts but within 2 years it was determined that our valuations were too low and 5 out of 6 were outside of what the state considers its’ confidence interval.
What this means to Shelby County property owners for the year 2022 is that most residential owners and some commercial property owners will see an increase in their valuations.
There will be a proposed proposition on May 7th to increase the state mandated exemption for homesteads with respect to school districts from $25,000 to $40,000 which will undoubtedly pass. There is also a 10% homestead cap that will limit the 2022 taxable value increase for those receiving homestead exemptions.
There has always been a longstanding adage concerning property appraisals. We all want our property to be appraised at the highest possible value for a bank loan and the lowest possible value for tax appraisals. At this point in time the state is telling us there is too big a difference in those appraisals.
For more information, read the press release from the Texas Association of Appraisal Districts at the link below: