Houston property taxes still high even after legislative maneuvering

Every legislative session in Austin, it seems there is some kind of movement in regard to property taxes. Just last year, lawmakers passed a bill which will grant some people in the state property tax relief, but even with all of the help, many in Houston are still paying big.

It has become a problem particularly in places like Pearland, where the owner of a median prices home ($364,000) pays annual real estate taxes of $7,800. That equates to a property tax rate of 2.16 percent of home value. They are not alone. Similar instances have happened in Atascocita and Sugar Land. But why?

State Senator Paul Bettencourt says while the state has lowered the property tax rate to around 1 percent, other entities in the area get the final swipe.

"It does not mean other taxing entities, like school districts and MUDs, can't add up to an effective rate of around 2 percent," he says.

In Texas, the problem tends to lie with local government entities. They are the ones who levy property taxes. In 2024, the effective property tax rate in Texas was about 1.47 percent, which is 7th highest in the country.

Now the legislature five years ago took action on lowering the rollback rate, which is the ability to raise property taxes from last year's tax levy.

But as you might expect, the local government in Harris County managed to ruin that.

"Harris County drove a Mack truck through this formula...using this effectively as a disaster exemption...then voter approval on incremental rates to drive up taxes dramatically," he says. "So, we are going to look at closing that loophole."

Closing that loophole though does not stop school district and other utility entities from getting in on the money. Senator Bettencourt is aiming to change that at some point in the future.

"I would love to lower rollback rates across the board, because that would then impact all the taxing jurisdictions," he says.

He adds they are looking at various other ways to try and cut back on the overtaxing from entities.

Helicopter Shot of Industrial Area in Houston, Texas with Skyline in the Distance

Photo: halbergman / E+ / Getty Images


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