Published: May 11, 2008 02:57 am         

Property values in county increasing

Preliminary appraisal rates indicate 85 percent of Hunt County property owners will see some sort of increase in their property values, the county’s chief appraiser said.

Property owners, however, won’t find out exactly how much their property values are increasing until after May 15. That is the day the Hunt County Appraisal District (HCAD) will mail out 68,000 Notices of Appraised Value, said Hunt County Chief Appraiser Brent South.

“We’re notifying every property owner this year,” South said. “We’re only required to notify those who have an increase of $1,000 or more or if it’s a new ownership this year or if an exemption has been denied or removed. But we decided since we’ve done a full reappraisal we’re going to send a full file.

“And actually most every property owner is going to realize some type of increase on their notices this year.”

South said that the average increase on residential properties is about 20 percent. The increase on commercial properties is about 30 percent. The average amount of money each property owner will be responsible for is hard to predict, South explained, noting it depends on a variety of factors including the property’s value, the assessed tax rate and what taxing entities the property is in.

“Our job here at the appraisal district is to appraise property,” South said. “H”

However, South cautions that the numbers being released are preliminary because the district hasn’t started its appeals process yet. Officials are expecting a high volume of appeals.

“So these numbers will see some reduction due to the appeals over the next two to three months,” he said.

But that doesn’t mean the district has over-inflated property values just to try to get more money from residents, South said.

“I feel that for the most part our values are correct, but when you’re mass-appraising 68,000 parcels of property there’s going to be a few instances were we may be off and that’s what we want to identify and our main objective is to get those values correct and make sure they are fair and uniform, (so that) everybody is paying at the 100 percent market value rate,” he explained.

The areas that will experience the biggest increase in property values are those in the Caddo Mills area and western portions of Hunt County.

“The western portion of the county has seen the most significant increase in total value. And a lot of that is due to the new construction,” South said.

HCAD officials first announced in March that residents should expect to see an increase in property values following a complete reappraisal of all properties in the appraisal district. Several area school districts have lost millions of dollars in state-funding during the past few years because state and local values have not lined up. Therefore, HCAD reassessed all 68,000 pieces of property on a variety of criteria including recent property sales to reflect market trends.

“Really, what it boils down to is when people open their notice of appraised value in a couple of weeks the first question they need to ask themselves: ‘Could I sell my property for what the appraisal district had it set at as of Jan. 1, (2008.),’” South said. “If they feel like they could sell it for that, then they’re probably OK. If they feel like that they could not get that for their property they need to come down and talk to us and we’ll sit down, visit with them and look at the data and if the data holds the value we have then we’re not going to make any change, but if the data indicates we are too high then we’ll go ahead and make the adjustment.”

HCAD Board member Jerry Grady said the reappraisal of 68,000 pieces of property in less than a year was an “enormous task.”

“We also recognize in doing (this in this short) period of time there can be some errors,” he said. “There can be some honest mistakes made and we need the property owner’s help to correct any mistakes that might have occurred.”



Economic conditions

Several HCAD officials say they realize the economy is slowing and the real estate market isn’t growing at the same rate it was several years ago and that the increase may cause sticker shock for many area residents, but they contend the properties were so undervalued that they had to increase in value.

“Our property though has been undervalued over the years,” said HCAD Board chairman Mike Taylor. “All we’re trying to do is get it up to the fair market value.”

He acknowledged properties in the D/FW area have been over-valued, but that’s not the problem in Hunt County.

“We have the opposite that’s working here unfortunately,” he said. “It’s going to be bad timing as people see things in the news...”

Board member Tim Kingsbury said no matter what the economy was doing, the property values would have gone up.

“Even without the mortgage crisis and all these things, values would have gone up here in Hunt County because they were low,” Kingsbury explained. “It just so happens they’re going to go up a little less with the recession and with the mortgage crisis, but the fact is they’re still going to go up.”

South confirmed the values are currently so low, they need to be increased. Once the properties reach their current market value, in the future residents may see a decrease in their property values.

“The problem is we’re not at that point yet,” he said. “So now we’re trying to catch up so we can be on an even playing field.”

The increase in values, South said, should help get “us most of the way caught up.

“I’m not going to tell you that we’ve completed the job in one year because it was such an enormous task that there was just no way to get it all done in one year,” he said. “But we have taken a big chunk out of it this first year.”



How did the county get so far behind?

Taylor, who served on the board with the county’s previous chief appraiser, said HCAD board members have no control over the appraisal process other than selecting a chief appraiser.

“The board, if I’m reading the statutes correctly, if they try to intervene in that process they have committed a felony so therefore the board just charges the chief appraiser and the district to do the job. And that’s all the powers we have.”

He said it’s up to the appraiser to set the rates, and the majority of the board does not have the expertise to tell if the values are accurate.

Until recently, he said, the board didn’t realize the property values were so far behind the curve.

“Our only measuring stick we had was that the districts were receiving state values instead of local values,” Taylor said.

He said board members began to realize something was wrong when area school districts began to lose millions in state funding.

“That was our check that something was wrong,” Taylor said.

In 2004, the appraisal district hired an appraisal consultant, Richard Petree, to look into the county’s appraisal process.

He informed the board at the conclusion of his review that HCAD had a flawed appraisal system.

“It appears to need a complete revamping,” Petree told the Herald-Banner in a 2004 article. He also warned that area school districts could expect to continue to come up short on state funding if the recommended improvements were not made.

Taylor acknowledged that Petree had acted as consultant for the county in the past.

“In the past he came in and looked and made recommendations to the board and that was it,” Taylor said.

South, who was hired as chief appraiser last year, has acknowledged in the past that the past appraisal system had not been working as it should and that a full reappraisal was “long overdue.”

“When you’ve got nine out of 11 school districts that fall outside (the) margin of error, that’s a pretty good indication that the job hasn’t been done properly in the past,” he said during an interview in March. “Nine out of 11 is just unacceptable. We’ve got to make some changes. We’ve got to get the problem resolved.”



What’s being done to make sure this doesn’t happen again?

The board has once again hired Petree as a consultant, this time, to look over the appraisal district’s work, Taylor said.

“He’s a very experienced man who knows his business,” Taylor said of Petree.

Board member Tim Kingsbury said HCAD board has also given South and his appraisers additional tools and authorization that will allow them to build a mapping system. He said the board is also making sure the staff is fully resourced and properly trained and that the rules and the laws of Texas are being followed.

South said the new technology is helping and there is more technology out there the district may purchase in the future that will allow them to have even more accurate appraisals.

“The board has talked about (it) at length,” Grady said. “Brent and the board are committed to appraising property at fair market value. And — I’d like to add the point — not to chase state values.”