The Houston housing market is hot. Inventory is low and demand is high. From March 2021 to March 2022, the average price of a single family home went up an astonishing 19.3%.
With rising market prices comes an increase in tax assessed values. Property tax protest season is here, and you have until May 15 to get it done.
About one third of homeowners across Harris County hire a firm to handle their property tax protest. These firms consist of professionals who study real estate for a living. They should be outperforming the amateurs. But I looked at over 200,000 protest hearings from homeowners in 2021, and the numbers are clear: homeowners do better on their own.
What’s inside this post:
- DIY protests are more likely to be successful overall
- Newly purchased homes see greater reductions
- DIY owner protests are more likely to succeed in every neighborhood
- Success rates are much higher in wealthy neighborhoods [MAP]
- Neighborhoods where protesting your property tax is most difficult
- Where are homeowners more likely to file a protest?
- Homeowners protest much more often in wealthy neighborhoods [MAP]
- Where do homeowners save the most when they DIY protest?
- In some cases, hired help can get a bigger reduction, but it’s still a risk
For the purpose of this analysis, “homeowner” is defined as a property with a residential homestead discount. In order to get this discount, the owner must occupy the property as their primary residence.
DIY protests are more likely to be successful overall
There were two things I wanted to know about the difference in protest outcomes between hired help and weekend warriors. First, who was more successful at getting any reduction at all? And if there was a reduction, who saved more? There were a few standout stats:
- Almost twice as many homeowners protested on their own, rather than hiring an agent.
- When there was a reduction, the amount saved was about the same between agent and DIY.
- But almost half of the agent-led protests had no success at all.
| n | Median Reduction | Success % | |
|---|---|---|---|
| Hired an agent | 64,043 | $16,003 | 53% |
| DIY | 118,125 | $16,784 | 82% |
Newly purchased homes see greater reductions
For homeowners who purchased their home on or after January 1, 2020, the difference was even more stark. Homeowners who handled the protest themselves were successful over 90% of the time, and had a median reduction almost $5,000 greater than agent-led protests.
| n | Median Reduction | Success % | |
|---|---|---|---|
| Hired an agent | 5,906 | $16,458 | 67% |
| DIY | 14,340 | $21,006 | 91% |
Texas is a non-disclosure state. In other words, the appraisal district can’t force anyone to disclose the purchase price of the home. But after a property is sold, the appraisal district will reassess the following year at their estimate of market value. If they overestimate, you can protest by disclosing the purchase price. This might explain the higher-than-average reduction amounts.
DIY owner protests are more likely to succeed in every neighborhood
In neighborhoods with at least 100 protests each for Agents and Owners, the homeowners had a higher success rate every time. These are the neighborhoods with the highest success rates for DIY protests:
| Neighborhood | Median Reduction | Success % |
|---|---|---|
| Willow Meadows | $19,358 ($16,077 Agent) | 95% (81% Agent) |
| Bellaire | $59,246 ($49,077 Agent) | 94% (79% Agent) |
| Lazybrook / Timbergrove | $25,666 ($17,442 Agent) | 93% (65% Agent) |
| Montrose | $33,328 ($24,000 Agent) | 93% (74% Agent) |
| Briar Forest | $22,051 ($20,618 Agent) | 92% (66% Agent) |
Success rates are much higher in wealthy neighborhoods [MAP]
Some neighborhoods have a much higher success rate at reducing property tax appraisal values. Sadly, this becomes another example of the Houston Arrow at work. The neighborhoods that are least likely to see a reduction in property tax are also communities that have lower rates of homeownership, experienced historic disinvestment, and were subject to redlining.
Neighborhoods where protesting your property tax is most difficult
The worst outcome of a property tax protest is no change in the assessed value. These neighborhoods have the lowest success rates for DIY protests:
| Neighborhood | Success % (Agent) | Success % (DIY) |
|---|---|---|
| Eastex-Jensen | 21% | 25% |
| Klein Far South | 19% | 32% |
| Northside / Northline | 21% | 32% |
| Cloverleaf | 23% | 43% |
| Golfcrest / Bellfort / Reveille | 22% | 44% |
Where are homeowners more likely to file a protest?
It’s not surprising that the neighborhoods where homeowners were most likely to protest also happen to be some of the most expensive neighborhoods in Harris County:
| Neighborhood | Homeowner Protest Rate | Agent % | DIY % |
|---|---|---|---|
| Memorial Villages | 60% of all homeowners | 59% | 41% |
| West University / Southside | 59% | 53% | 47% |
| Bellaire | 58% | 44% | 56% |
| Afton Oaks / River Oaks | 58% | 62% | 38% |
| University Place | 55% | 57% | 43% |
At the same time, the neighborhoods that are least likely to protest are also historically underserved:
| Neighborhood | Homeowner Protest Rate | Agent % | DIY % |
|---|---|---|---|
| Trinity / Houston Gardens | 4% of all homeowners | 25% | 75% |
| South Park | 4% | 25% | 75% |
| Eastex – Jensen | 4% | 44% | 56% |
| East Little York / Homestead | 5% | 30% | 70% |
| Northside / Northline | 6% | 43% | 56% |
Homeowners protest much more often in wealthy neighborhoods [MAP]
The map below shows the homeowner protest rate for each neighborhood. There is a strong correlation between the median household income of a neighborhood and the likelihood of protesting.
Where do homeowners save the most when they DIY protest?
These are neighborhoods where homeowners saw the largest average difference between doing it themselves and hiring an agent. DIY also had higher success rates overall. Of course, this ranking method favors neighborhoods where property tax assessments are already high.
| Neighborhood | Median Reduction | Success % |
|---|---|---|
| Afton Oaks / River Oaks | $86,175 ($78,198 Agent) | 90% (76% Agent) |
| West University / Southside | $81,889 ($59,680 Agent) | 91% (68% Agent) |
| Memorial Villages | $80,706 ($84,368 Agent) | 91% (75% Agent) |
| Bellaire | $59,246 ($49,077 Agent) | 94% (79% Agent) |
| University Place | $52,292 ($36,888 Agent) | 88% (64% Agent) |
In some cases, hired help can get a bigger reduction, but it’s still a risk
There are some neighborhoods where hiring help can lead to a greater reduction in the property tax assessment. But it can be a gamble: the overall protest success rate is much lower with agent-led protests.
| Neighborhood | Median Reduction | Success % |
|---|---|---|
| Memorial Villages | $84,368 ($80,706 DIY) | 75% (91% DIY) |
| Uptown | $46,456 ($37,187 DIY) | 61% (85% DIY) |
| Nassau Bay | $19,356 ($13,630 DIY) | 41% (70% DIY) |
| Hobby | $16,959 ($10,509 DIY) | 15% (37% DIY) |
| Waller | $14,553 ($10,715 DIY) | 46% (74% DIY) |
Have a question or a suggestion? Feel free to contact us.
