Annual Property Tax Increases on Rental Properties

2 Replies

Here in Bexar County (San Antonio, TX), the annual property tax statements went out at the beginning of May. 

For my personal residence, the value on the home increased $21,000, which equates to approximately $42 per month extra per month in property taxes.  This happened pretty much all across Bexar County.

But my question is for the buy-hold investors in Bexar County and even other higher property tax areas.  A $42 increase in monthly expenses can significantly effect cash flow on rental properties.  

Do you do everything you can and create elaborate dispute cases against the value or will you just simply pass the increase onto the tenant during the next lease?  What if you lose the appraisal dispute and have 9 months left on the lease?  You have no choice but to eat it, right?

Just curious what everyone would do for this.

That's a good topic and quite common for the property taxes to go up once improvements are made.  Also when a home goes from owner occupied to rental it will increase. 

Property tax increases are definitely something to account for in the future.  

@Ryan Young I'm also in Bexar county and also experienced an increase in the value of my personal residence. It doesn't apply to rentals, but if you have a homestead exemption, there is a 10% cap on year over year increase.  So if that 21k is more than 10%, you'll only see taxes increase by 10%. 

Here's an article in the express news about it: Link

Also, there are attorneys in town who specialize in protesting appraisal value increases. For a very reasonable rate, they will do all the heavy lifting (I'm personally using one this year). They typically get a flat rate and then a small percentage of how much they save you.   I'm guessing they would be a valuable tool on rentals as well, since there is no cap in place. 

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