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A Michael Berry supporter recently asked The Insider why rival mayoral contender Bill White's homestead in the tony Stablewood neighborhood carried a $100 valuation on the improvements on the property. White's latest total appraisal is $1.23 million. The estimated market value is $2.8 million for the lot and two-story house, which overlooks Buffalo Bayou in the gated community off the West Loop.
While the answer reveals no impropriety, it does illustrate how caps on annual property tax increases can inadvertently favor some folks big-time.
When the Whites' dream home was completed three years ago, it was valued at a little more than $500,000, with the total property appraised at about $1.02 million. Guy Griscom, assistant chief appraiser for the Harris County Appraisal District, says the bayou floodplain area was undervalued until White bought his property, raised the surface level and began developing it as a homestead. By law, appraisal increases are limited to 10 percent annually. The value of his land jumped up to the point where it nearly equaled that legal maximum for appraisal increases.
The district's tax computer doesn't like to apportion percentages between land and improvements in such situations, says Griscom. Instead, it just dumps all the appraised value on the land, and lowers the house and improvements to a token $100. The fortuitous -- and totally legal -- result is that White paid $11,631 last year in taxes on a property with an appraised value that was less than half its true market value.
A comparison with the homesteads of the other three mayoral candidates shows they don't enjoy the same disparity between appraisal and market value, but then they don't pay nearly as much property tax, either.
State Representative Sylvester Turner's homestead in Oaks of Inwood is appraised at $193,700, the exact amount of its market value, according to HCAD. He paid the resulting $2,215 tax bill.
Former councilman Orlando Sanchez's abode on Cheena Drive in Westwood is appraised at $77,100 and carries a market value of $111,400. He actually double-paid his $782 tax bill for the year and is owed a refund.
Councilman Michael Berry's storefront home on lower Westheimer is appraised at $184,080 without an estimated market value. He pays just over $2,000 in property taxes.
Clearly, White is in a financial class of his own in this race, at least when it comes to home values.
"Andrea and I pay property taxes on the same basis as everyone else," said the candidate, who diplomatically added that he and his wife "can sympathize with hundreds of thousands of other homeowners whose property taxes have soared."
While White is getting a big tax break on the valuable Stablewood property, appraiser Griscom notes that it comes with significant risk attached.
"All the land along the bayou there had very significant negative influences on it," he explains. When White constructed his home on the bayou slope, he helped ignite a building boom on what was previously considered undesirable, flood-prone real estate.
"By doing that, he set the pattern that others now are emulating," says Griscom, who also sounds a note of caution. "We haven't had a major rise in the water since some of that building started, and it will be interesting to see how they fare the next time we have a major elevation in water."
If he gets elected, don't be surprised if one of White's major areas of interest will be Buffalo Bayou flood control. -- Tim Fleck