Valuation Notice
A valuation notice is a letter from the local property assessor telling owners their property’s assessed value for the next tax year. It also lists the market value and any exemptions. Most owners get this notice every spring before property tax bills arrive.
Why It Matters
The assessed value directly affects how much property taxes home and property owners must pay. Checking this notice is important because:
Mistakes can lead to higher taxes
Owners can appeal overvalued assessments
Knowing your assessed value can help you plan for property tax payments
For example, in Texas, we found that in high-density counties, homeowners who didn’t appeal their property taxes had an accumulative 10.91% higher market value in 2024 than those who appealed.
Assessors Set Property Value
Assessors use three primary methods to figure out property valuation:
Sales comparison: Looks at recent sales of similar properties.
Income approach: Estimates value based on current or expected rental income (common for commercial properties).
Cost approach: Calculates what it would cost to rebuild the property.
How Renovations Affect Value
Significant upgrades, like a kitchen remodel or adding a guesthouse, usually raise a property’s assessed value, especially if you apply for county permits.
For example, if a property assessed at $250,000 adds a $50,000 kitchen remodel, the new assessed value could increase to $300,000. At a two percent tax rate, the property tax would rise from $5,000 to $6,000.
If you renovate, expect higher property taxes, and double-check that the assessor’s adjustments are accurate on your following valuation notice.
Assessment Increases and Caps
Some areas limit how much a property’s assessed value can rise yearly, especially for homesteaded properties. For example, a homestead property might have a 2% annual cap, even if the market value jumps by 10%.
With a cap: A residential property valued at $300,000 has a 2% annual cap. If the market value jumps 10% to $330,000, the assessed value increases to only $306,000, leading to a modest tax increase.
Without a cap: The same residential property valued at $300,000 faces the full reassessment. If the market value jumps 10%, the assessed value becomes $330,000, resulting in a sharper tax increase.
However, non-homesteaded properties, like rentals or commercial buildings, often face full market-value reassessments. Understanding these rules is key to managing long-term tax costs.
Common Assessment Mistakes
Valuation notices often have errors or make generalizations. Check key details like building size, lot dimensions, and features to ensure they match public records. Also, confirm that sales comparisons use similar properties, and make sure any state-wide or local exemptions and caps are applied correctly.
How To Appeal a Valuation Notice
If the assessment seems too high, you can appeal!
The first step is gathering proof, such as recent sales of similar properties, an independent appraisal, or photos showing the property’s condition. Then, you submit the appeal and evidence to the local assessor’s office.
Most county appraisal districts or appraisal review boards will send an updated appraisal notice. If you accept, this is often called an informal appeal. If you still don’t think it’s a fair valuation, you can do a formal appeal. Note that most formal appeals require that you attend a hearing before a review board.
If you don’t have the time, resources, or confidence to fight your property taxes correctly, consider using Ownwell!
Deadlines for Appeals
Valuation notices usually arrive in spring, and you have limited time to appeal — often 30, 45, or 60 days from the notice date. Acting quickly is essential!
Who Should Pay Attention
Every property owner should review their valuation notice:
Homeowners: To avoid overpaying on property taxes.
Rental property owners: Because higher taxes reduce rental income.
Commercial property owners: To control rising operating costs and boost net operating income (NOI).
You're Next Step: Reach Out to Ownwell
Regardless of whether you think your valuation is fair or not, it’s best to appeal your property taxes to keep them lower year after year.
Ownwell can help. We'll review your assessment and file an appeal on your behalf.
Since 2021, we’ve won over 240,000 appeals. Find out what Ownwell can do to help you save on property taxes.