Graduation Semester and Year
2012
Language
English
Document Type
Dissertation
Degree Name
Doctor of Philosophy in Urban Planning and Public Policy
Department
City and Regional Planning
First Advisor
Fred Forgey
Abstract
Article 8 of the Texas Constitution requires property taxation to be "equal and uniform," and state law requires nearly all real property to be assessed at 100% of market value. Despite these requirements, evidence exists that the appraisals of some high-value commercial properties, specifically downtown class A office buildings, vary widely from market value. According to the state Comptroller's Property Value Studies, residential property tends to be fully valued for tax purposes. An equity issue arises from the apparent undervaluation of high-value commercial properties, which typically are owned by wealthy individuals and institutional investors.While residential property tends to be homogeneous with frequent sales to use for comparison, commercial property is largely heterogeneous with infrequent sales. Data on commercial sales is less available and harder to obtain than data on residential sales. Even though Texas state law does not require the disclosure of real estate sale prices, most residential sales are recorded in local real estate multiple listing service databases that are accessible by county appraisal districts. Information on commercial property sales is more difficult to obtain and is available primarily through non-broker sources such as CoStar and other data providers.Some of the variation in appraised value of class A office buildings in the downtowns of the five most populous Texas cities can be traced to technical, legal, procedural and political issues in valuation. Other potential causes of appraisal variation are revealed by the theoretical approaches of the new institutional economics and the concept of bounded rationality. Tax appraisers in the five most populous Texas counties were surveyed to gain insight into obstacles to appraisal accuracy. Solutions proposed involve better use of market data and modeling and changes to administrative procedures and policy at the state and local levels. A valuation model is proposed that may increase the accuracy of high-value property appraisal and could have application beyond the class A office segment of commercial real property.
Disciplines
Architecture | Urban, Community and Regional Planning
License
This work is licensed under a Creative Commons Attribution 4.0 International License.
Recommended Citation
Johnson, James Howard, "Variation In Commercial Property Tax Appraisal Accuracy In Texas" (2012). Planning Dissertations. 12.
https://mavmatrix.uta.edu/planning_dissertations/12
Comments
Degree granted by The University of Texas at Arlington