Texans Vote on Proposition 1

Real Estate Agent with Keller Williams Premier Realty 0578279

Property Taxes and Affordability in Texas

It’s no secret that Texas has some of the most affordable home prices in the country.   You can easily find a very nice 4 bedroom, 3 bath home with ample square footage on a nice lot in a desirable neighborhood in the low to mid $200,000’s.  The flip side is that property taxes in Texas can be a bit on the high side.  And property appraisals in Texas, which is what the property taxes are based, has been on a constant increase over the last few years.


Texas Homestead Exemption

On November 3rd, Texans will vote “Yes” or “No” on The Texas Homestead Exemption for School District Property Taxes Amendment, otherwise known as Proposition 1.  The official ballot title reads as follows:  “The constitutional amendment increasing the amount of the residence homestead exemption from ad valorem taxation for public school purposes from $15,000 to $25,000, providing for a reduction of the limitation on the total amount of ad valorem taxes that may be imposed for those purposes on the homestead of an elderly or disabled person to reflect the increased exemption amount, authorizing the legislature to prohibit a political subdivision that has adopted an optional residence homestead exemption from ad valorem taxation from reducing the amount of or repealing the exemption, and prohibiting the enactment of a law that imposes a transfer tax on a transaction that conveys fee simple title to real property.” (Texas Legislature SJR No. 1)

Voting “Yes” would increase the homestead exemption from $15,000 to $25,000 (elderly and disabled Texans would see their exemptions increase from $25,000 to $35,000).  The proposition also would prohibit enacting a real estate transfer tax.  Voting “No” would not change the current homestead exemption of $15,000.  Depending on the district in which the homeowner resides, the estimated savings per year is between $120-$130 and would result in a cost of $1.2 billion in tax revenue for school districts over 2 years.  The lost revenue would, however, be recouped by allowing schools to apply for additional state aid from the Foundation School Fund.  How is that funded you might ask?  It comes from revenue from the Permanent School Fund, supplied by land property rights income and state fuel taxes, according to the Texas Education Agency.


The Bottom Line

The real crux of the matter is that Texans feel over-taxed on real estate holdings.  While this may not fix the problem entirely, it’s a start.  And the bottom line…Texas is still a great place to own real estate because of its affordability.


Photo courtesy of David Castillo Dominici and FreeDigitalPhotos.net

Posted by

Monte Wall

Broker Associate - Keller Williams Premier Realty

Katy, Texas

(281) 777-0869


Comments (4)

Ronald DiLalla
Century 21 Discovery DRE 01813824 - Anaheim, CA
No. Orange Cty Real Estate

Hi Monte, good luck with this one and thanks for sharing with us in AR Land.

Oct 26, 2015 05:27 AM
Yolanda Cordova-Gilbert
Richmond, TX


 Nice to meet you fellow Katyite! Thanks for the information! I need to early vote!

Oct 26, 2015 08:28 AM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Monte, the homestead exemption in our state is $45,000 and it makes a big difference in property taxes owed.

Oct 26, 2015 09:49 PM
Monte Wall
Keller Williams Premier Realty - Katy, TX
Keller Williams Premier Realty - Katy, Texas

Ronald, thank you for your kind words.

Yolanda, nice to hear from a neighbor.  I too need to early vote.

Bruce, sounds like y'all got it right.  Thank you for your comments.

Oct 27, 2015 12:08 AM