Can I protest the first-year value on a newly built or newly bought Texas home?
Can I protest the first-year value on a newly built or newly bought Texas home?
Yes — you can protest the value of new construction or a newly purchased home like any other property, and the first year is often the best time to protest because the homestead cap hasn't yet kicked in and the district's value may be based on incomplete or builder data.
New construction and recent purchases are among the most protest-worthy situations in Texas, because the protections that hold values down in later years often haven't applied yet.
You have the same right to protest. A new or newly purchased home is appraised at market value as of the January 1 lien date like any other property, and you may protest it under Tex. Tax Code §41.41 on the grounds of over-market value or unequal appraisal.
Why the first year is high-leverage:
- The homestead cap hasn't started. Under Tex. Tax Code §23.23, the 10% cap takes effect on January 1 of the tax year after the first year you qualify for the homestead exemption. So your first-year value can be set at full market value with no cap cushion — a reason it can jump and a reason a protest can pay off.
- Partial completion matters. A home is valued by its condition on January 1. If construction wasn't finished on that date, the district should value only the work in place as of January 1, not the completed house. If your notice reflects a finished home that wasn't done on January 1, that is strong protest grounds.
- Builder/sale data can mislead. Districts sometimes lean on the builder's contract price or list price, which may include lot premiums, upgrades, or incentives that don't reflect open-market value. Your own arm's-length purchase price and comparable sales of similar new homes are persuasive evidence.
For recent buyers specifically:
- The prior owner's exemptions and capped value do not transfer — your value can reset upward in your first year, surprising many new owners (see the homestead-cap explainer).
- Make sure you apply for your homestead exemption for the year you qualify; it both lowers taxable value and starts the 10% cap protection for future years.
- If your purchase price is below the district's value, that is direct market evidence; if it's above, you can still win on unequal appraisal.
How to protest: file Form 50-132 by the deadline, mark both market-value and unequal-appraisal grounds, and request the district's evidence under Tex. Tax Code §41.461. Bring your closing statement, comparable sales of similar new builds, and (if relevant) photos and dated proof of the home's incomplete condition on January 1.