RETC helps property owners decide when to protest valuations


Appraisal districts started releasing 2013 preliminary appraisal values as of May 1. RETC (Real Estate Tax Consultants), a leader in the property tax consulting industry, has provided tips for property owners as they determine whether or not to protest.

Property taxes are typically the largest line item expense, which can have a major impact on the cash flow and sale price of a building.

“Each jurisdiction is unique in how they value properties and administer property taxes even within state lines. The more dynamic a property is, the more volatility there will be in taxes,” said Amish Gupta, RETC’s chief operating officer. “These factors can leave owners with a tax bill that does not reflect the true value of their property resulting in overpayment.”

With property taxes and determining when to appeal, consider these factors:

— Understand local administrative policies. This is the first step in gaining valuable knowledge to ensure a property is valued fairly and to keep taxes low.

— Identify appraisal parameters. Knowing which appraisal parameters jurisdictions are willing to negotiate will help ensure a property is being valued properly and fairly.

— Recognize appraisal jurisdictions’ experience. Appraisal districts are often valuing every type of real estate, may be understaffed and may not have the technical expertise or information available to make quality valuations.

— Hire professional help. If you are not an expert and are having trouble, hire an experienced professional who knows the local rules and regulations.

If a property has seen an increase in net operating income (NOI), owners should anticipate some type of commensurate increase in property taxes. However, by managing property taxes, owners will reap the benefits of increased NOI and cash flow while increasing the value of the property and their debt coverage ratios.