Unlike lower to mid range residential property, cookie-cutter high end residential property does not exist. A detailed valuation approach needs to be undertaken in order to maximize tax savings on any given property. This type of property is unique to each owner.Large appraisal districts, like HCAD, use a computerized valuation program to develop estimates of value. However, these are only estimates which is why appraisal districts are often well off the actual market value in their appraisals. High end residential property taxes are usually always calculated incorrectly.
Under the cost approach, appraisal districts use cost data from a national supplier of construction cost information, the system calculates a replacement cost for each residential structure based on the property’s characteristics, such as size, type of construction, quality, and age. A land value for each property is also developed using generally accepted appraisal techniques. In calculating each of these items, the valuation program considers a number of data items. Some data items are generated by other programs, some are provided to us under copyright from third party vendors, and others (such as the dimensions of a building or a code designating condition) are manually entered by an appraiser. Don’t let computerized valuation programs like these dictate how much you are paying in taxes.