Austin is one of the fastest-growing cities in the United States, and it’s also a hotbed for startups and tech companies. As a result, there are plenty of people who want to live here. Good for homeowners, but bad for renters, because that means competition for housing is fierce. Well, it’s also bad for homeowners because the prices of the properties will be rising in the next months or years, and that will push up the property taxes.
The effective property tax rate is the amount of taxes paid as a percentage of home value. It’s calculated by dividing total property taxes by median home value and multiplying that number by 100%. The median property tax paid for owner-occupied homes in Austin was $2,094 in 2017, according to estimates from the U.S. Census Bureau’s American Community Survey (ACS). This figure represents an increase from 2016’s median payment of $2,050, but still lower than 2015’s median payment of $2,114. The average effective property tax rate for owner-occupied homes throughout Texas was 1.18% during this same period. This puts Austin as one of the US cities with the highest property taxes.
Other Large Texas Metros With High Property Tax Rates
The state of Texas has a number of large metro areas, including Dallas-Fort Worth-Arlington and Houston-The Woodlands-Sugar Land region. In addition to Austin, these metros have some of the highest property tax rates in the country. San Antonio-New Braunfels also has a high rate but is not included in this analysis because its data are not available for 2016 (the most recent year available).
They pay way more property taxes, compared to cities in other states, such as Rochester, New York, that has the lowest effective property tax rate for owner-occupied homes at 2.4%. The city also offers a variety of tax exemptions and credits for its residents that can reduce their overall tax burden even further.
Why Houston Charges High Property Taxes to Homeowners
Property values are determined by county appraisers who estimate what your home would sell for on the open market if you were to put it up for sale today (not what you paid for it). The appraiser also takes into account other factors like location and condition when determining this value.
Once they’ve come up with an estimated market value, they compare this with similar properties that have sold recently in your area. This gives them an idea of how much more (or less) than average your house might be worth compared to others nearby. They then apply their own judgment based on those factors until they come up with something close enough that everyone involved can agree on its final assessment price tag.
Impact of Property Taxes on Homeowners
Property taxes are a major source of revenue for local governments, and they’re also one of the largest costs faced by homeowners. In Austin, property taxes are paid to Travis County and can be used for any number of purposes: public safety services like police officers or firefighters; infrastructure projects like roads and bridges; parks maintenance; libraries; public schools (including school districts outside the city limits); emergency medical services (EMS); mental health services; animal control programs; fire prevention activities; mosquito abatement programs or other pest control programs on public property within the county’s jurisdiction.
Over time, rising property values can result in higher tax bills even if your tax rate remains unchanged because it takes more money at today’s higher home values to cover yesterday’s expenses when those expenses were lower. On average across Texas cities with populations over 50,000 people, effective tax rates tend not only vary by municipality but also change significantly over time. This is due to shifts in market conditions such as population growth/decline or changes made by policymakers such as adjusting mill rates up/down which affects how much revenue is generated per $100 worth sold.