Home Buying in Austin>Question Details

maggie, Home Buyer in Austin, TX

I am building a new home in Austin, Texas -- we will very likely close in November 2014. How will we know what sort of property taxes we will owe?

Asked by maggie, Austin, TX Thu May 8, 2014

Basically, we just aren't sure if you only pay the portion of the year that the home is livable/complete? Are property taxes calculated after closing? Thank you! This is our first home and we're a little baffled :)

Help the community by answering this question:


you can look at the tax records in your area and find out what your neighbors are paying.
0 votes Thank Flag Link Tue Dec 30, 2014
Don is right. The first year you'll pay a small amount of tax because you'll be charged the unimproved value of the home. The real thing will come after the home is completed and the county will assess the value of this home. You can still protest this "improved" value, though, but that's a totally different subject.

Susie Kay, Realtor®
United Real Estate
III Lincoln Centre, 5430 LBJ Freeway #280
Dallas, TX 78240

Servicing your real estate need is my priority!
0 votes Thank Flag Link Sun May 11, 2014
Hello Maggie,

Your new home will be charged taxes on the unimproved or dirt value your first year. So for the remaining part of 2014 you are in the home you will pay a very low amount for taxes. At closing you will also receive a credit for taxes on the land from January 1 of this year until the day you close. Come December... or actually when you close since you are closing in November the full taxes will be paid and you will pay the remaining 2 months out of your own funds.

So now you have to estimate the approximate taxes on the home going forward. One thing to note about this... Texas is a non-disclosure state so you do not want to tell the county what you paid for the home unless your number is lower than what the county is assessing the property at. So if you paid $250,000 for your home an the county is assessing the property at $275,000 then you would want to show them what you paid. If they are assessing the property lower than what you paid you definitely do not want to tell them that information. So just remember that when you complete your homestead exemption form... you do not have to share what you paid for the property unless it is to your benefit to do so.

Back to your tax question. The title company you are closing with (ask the builder for their contact information) can pull the tax rates for the property you are buying. You won't know the exact value the county will assess the property at but using the purchase price will get you pretty close to what you should expect to pay. If you plan on having escrows make sure the lender and title company establish your escrow account correctly. I have known them to use the dirt value and then when the new value is determined you will have a huge escrow shortage so make sure they do estimate your actual taxes accurately so you don't have any issues going forward.

Congratulations to you on your new home!

Don Groff | REALTOR® & Mortgage Broker
Austin Real Estate Pros & 360 Lending Group
o 512.669.5599 | m 512.633.4157 | listings@dongroff.com
websites: http://www.AustinListed.com | http://www.360LendingGroup.com
Web Reference: http://www.austinlisted.com
0 votes Thank Flag Link Fri May 9, 2014
Hi Maggie:

You'll only pay taxes for the time you own the house and on the complete home. The owner of the land pays the taxes until then. The tax assessor will ultimately determine the amount you owe, but you may pay based on an estimate until then. It'll become more clear as you get closer to closing, but your agent should be able to give you a rough estimate now.

Congrats on the new home!

Alysse Musgrave
Consumer Advocate/Exclusive Buyer Broker
#1 Best Selling Author of Buying a Home: Don’t Let Them Make a Monkey Out of You!
0 votes Thank Flag Link Fri May 9, 2014
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