Hot real estate market means higher home values in 2016
According to recent sales data, Tarrant County continues to be one of the hottest real estate markets in the country, and Tarrant Appraisal District (TAD) officials are preparing local home owners for strong property valuations in 2016.
New citizens continue to flood into North Texas seeking jobs and the Texas lifestyle, which means homes are in high demand. When evaluating residential markets, the normal home inventory is usually around six months, according to the Texas A&M Real Estate Center. However, inventory levels in Tarrant County currently stand at less than two months.
Because of the high demand and the limited inventory, many property owners will see higher assessed values this year. Notices will be mailed on April 1 to those residential property owners whose valuation increases more than $1,000. All commercial property owners will receive a valuation notice. Property owners may choose to protest their assessment. Instructions to file a protest are included in the appraisal notices and can be found at www.tad.org.
Property owners with residential homesteads will be protected from increases higher than 10 percent. Because of the appraisal cap limitation, appraised value used to determine homesteaded property taxes are limited to 10 percent appreciation.
Property appraisals are determined by TAD and used by local taxing units to calculate taxes, which pay for police and fire protection, public schools and hospitals, road and street maintenance, courts, water and sewer systems and other public services.
The Equalization Phase Begins
Monday April 4th marks the beginning of the equalization phase of the appraisal cycle. This phase, running from April 1st to August 1st, is the time of year homeowners can discuss, evaluate, or protest the 2016 appraisal of their homes with the appraisal district.
On April 1st we mailed over 328,000 appraisal notices to property owners with residential homestead exemptions. By the end of April we will have mailed approximately 512,000 residential notices for the 2016 appraisal cycle. All of the notices mailed on April 1st will have a protest deadline of May 2, 2016.
A few changes have been made to the format of the notices. Most notably, the section listing a property’s exemptions now includes the prior year’s exemptions, the current year’s exemptions, and any cancelled or reduced exemptions.
In accordance with the property tax code, section 25.19, a notice must be sent if an exemption has been cancelled or reduced and it must be clearly represented on the notice.
Commercial and Business Personal Property appraisal notices will be mailed in phases starting May 1st and June 1st. The deadline for filing protests, other than residential homestead accounts, is typically May 31st or 30 days after the notice was delivered.
Property owners can file protests a couple of different ways this year. If they choose to come to the office in person, they can file a formal protest with the Appraisal Review Board. In addition, they can leave evidence with our staff and an appraiser will review the evidence. If possible, we will try and settle the value differences before a formal hearing.
A property owner may choose to file a protest online through our internet e-access portal. Once there, an owner can provide an opinion of value, and it’s possible the offer may be accepted online. If an online settlement can’t be reached, a formal protest will be filed and the property owner will have the right to proceed to a formal Appraisal Review Board hearing.
As always, there will be customer service representatives in our office to assist taxpayers wanting to protest their appraisals. We will make every effort to keep the process running as smoothly as possible to resolve protests and certify accurate values for the tax roll come July.
2016 Tarrant County Housing Market Continues Surge
Tarrant County’s real estate market is booming, and 2016 should be another strong year according to industry insiders. “Housing demand will likely remain strong and home prices will likely continue to rise over the next year,” said a Texas Association of Realtors representative in a recent statement.
Texas has enjoyed four years of steady growth in the real estate market. Tarrant County, the third most populous county, is growing fast and so is the demand for housing.
Home sales are up as market conditions continue to become increasingly competitive across the state. Houses are selling within hours, often before being listed. Sellers are receiving multiple offers for their homes, causing bidding wars among buyers and driving up sales prices.
The number of homes sold in Tarrant County is up this year in comparison with those sold in the first few months of 2015. Our sales information not only indicates more homes being sold, but some are selling for higher than list price, according to the Research and Valuation department at Tarrant Appraisal District. Homes are on the market for a much shorter period, averaging about 30 days or less. Alternately, building permits for new home construction for the same time period is down from last year.
Area home prices have surged in recent months due to increased demand from buyers and low inventory levels of new and existing homes. Economists agree that six to seven months’ worth of homes on the market is considered normal. Nationally, the current supply of inventory of single family homes is approximately four months. In Tarrant County the current supply is less than two months.
Tarrant County’s inventory has been on the decline since topping out in 2011 with almost eight month’s supply of inventory.
Although the market is tight, growth in Tarrant County continues as the population climbs towards 2 million, garnering the sixth largest jump in the nation last year according to the census data. As a whole, the Lone Star state grew by more than 500,000 people.
Solid growth, coupled with low interest rates that are unlikely to rise above 4%, will continue to generate demand and the need for homes. However, a slowdown in the price of homes is expected this year as the market begins to level out to more typical growth rates.
Public Data Workshop Held on First Tuesday of the Month at 2:00 pm
TAD holds its Data Workshops on the first Tuesday of the month at 2:00 PM - his workshop is free and open to the public. TAD requests that anyone who desires to attend please RSVP by email to the Webmaster@tad.org indicating the number of people in their group so that we may provide the best accommodations possible.
Held at the TAD offices located at 2500 Handley-Ederville Rd, Fort Worth, 76118 – attendees are encouraged to bring their own laptops and / or other mobile computing devices so that we may provide hands-on instruction and assistance. TAD is dedicated to providing our customers in the public and private sectors the most accurate, user-friendly, legally-permissible data possible.
The Barnett Shale has seen better days
In the year 2000, Tarrant County only had 83 mineral accounts. By 2005 that number had grown to 5,500. By 2007, the number was over 18,000 then jumped to 41,000 by 2008. It continued to grow exponentially over the next six years to a record number of 774,000 accounts. Amazed by a quarter of a million mineral accounts, the 2015 tax year added more accounts and we topped out with just over 971,000.
Taxable Values grew in a similar fashion. The total taxable value in 2000 for Tarrant County was only $651,000 thousand. By 2005, the value was over 520 million, but in 2009, we saw the high watermark with values rising to over 4.8 billion.
However, 2010 was the year values in the Barnett Shale began to fall. Within three years, mineral accounts lost a billion dollars and went on the tax rolls at 3.6 billion. Two years later, another billion came off the roll and we certified 2.6 billion. As we prepare for the 2016 appraisal year, property values for natural gas wells in Tarrant County is expected to take another plunge.
According to a petroleum engineer-appraiser with a local appraisal firm, “The upstream business of producing natural gas is currently in distress due to an abnormally and persistently low price environment.” Natural gas prices began declining in February 2014 from a price of over $4.00 per thousand cubic feet to eventually fall below $2.00 per thousand cubic feet in early 2016.
The petroleum engineer-appraiser went on to say, “The decline is due in part to the economic supply and demand for natural gas. There is simply too much supply for the current demand.” As long as natural gas prices remain low, drilling companies will likely not consider producing new wells.
Mineral values are determined based on three primary elements – price, production and anticipated reserves. Prices being down has a direct negative effect on production. In addition, as a well grows older with age, production will naturally decline. Reserves make up the remaining gas in the ground. As long as price is low, and becomes less profitable to retrieve, the reserve gas will likely remain in place until prices rebound.
Without any anticipated change in current pricing, the distress in the current energy markets will have a significant effect on 2016 mineral values. It is anticipated that mineral value for Tarrant County and other counties in the Barnett Shale could decline as much as 30 to 50 percent from the 2015 levels.