Build on your lot HCAD protest (Howe: sales, how much, new house)

[JohnStein]

Hi,

I searched and couldnt find any thread on this. I torn down my house and rebuild, the improvement portion of the appraisal came back higher than the cost to build. I already submitted my cost to build but that was rejected by the isettle process.

Has anyone encountered this situation? What have you done and result?

Thanks in advance!

[recuerdeme]

So you tore down an old house and built a new one? Now, the appraisal district is saying the improvement value is more than what it cost you to build?

I don't see an issue here.

[3shipguy]

Did you factor in land value? Cost to build and value of property are not the same. Correct me if I'm wrong.

[WRM20]

Originally Posted by JohnStein

Hi,

I searched and couldnt find any thread on this. I torn down my house and rebuild, the improvement portion of the appraisal came back higher than the cost to build. I already submitted my cost to build but that was rejected by the isettle process.

Has anyone encountered this situation? What have you done and result?

Thanks in advance!

What's your point? The appraisal is based on what the property would sell for, not what it cost to build.

[marksmu]

Originally Posted by JohnStein

Hi,

I searched and couldnt find any thread on this. I torn down my house and rebuild, the improvement portion of the appraisal came back higher than the cost to build. I already submitted my cost to build but that was rejected by the isettle process.

Has anyone encountered this situation? What have you done and result?

Thanks in advance!

They did this to me. Just take your records of what it cost to build into your appeal and they will lower it down to your actual cost.

Its a game they are playing now - they want to get the exact amount that you paid correct - so in order to do that (since there is no sales value on HAR they can get) they appraise you for a huge number that they pulled right of their behind and then you come back screaming "thats ridiculous, it only cost $XXXX to build it" and they say - oh - well - ya, since you provided me with the receipts we will lower it to that value.

You leave thinking you won, when they have actually conned you into providing them with the exact cost to build - and you part ways until next year where they use ridiculous comps to jack your value up again.

Keep in mind, the cost to build is just the cost of the "improvements" you do still have to add in the cost of the land.


Wash, rinse, repeat next year.

[JohnStein]

Yes, that's what I am comparing, just the cost to build vs improvements, not land value. Thanks marksmu.

[WRM20]

Originally Posted by marksmu

They did this to me. Just take your records of what it cost to build into your appeal and they will lower it down to your actual cost.

Its a game they are playing now - they want to get the exact amount that you paid correct - so in order to do that (since there is no sales value on HAR they can get) they appraise you for a huge number that they pulled right of their behind and then you come back screaming "thats ridiculous, it only cost $XXXX to build it" and they say - oh - well - ya, since you provided me with the receipts we will lower it to that value.

You leave thinking you won, when they have actually conned you into providing them with the exact cost to build - and you part ways until next year where they use ridiculous comps to jack your value up again.

Keep in mind, the cost to build is just the cost of the "improvements" you do still have to add in the cost of the land.


Wash, rinse, repeat next year.

I'm calling BS on this. The appraisal is what the property is worth, not what you paid to build the structure plus the land value. The price paid can be used if you bought the property with a house on it, and didn't rebuild, I've done that. However, if the lot is worth $300k, and you spend $500k to build and the property would now sell for $1.2 million, then it should be valued by HCAD at $1.2 million. That would be the house across the street from me.

[WRM20]

Originally Posted by JohnStein

Yes, that's what I am comparing, just the cost to build vs improvements, not land value. Thanks marksmu.

The cost to build is, and should be, irrelevant. The value is supposed to be how much the property would sell for on January 1.

[KStoNYtoILtoTX]

Originally Posted by WRM20

I'm calling BS on this. The appraisal is what the property is worth, not what you paid to build the structure plus the land value. The price paid can be used if you bought the property with a house on it, and didn't rebuild, I've done that. However, if the lot is worth $300k, and you spend $500k to build and the property would now sell for $1.2 million, then it should be valued by HCAD at $1.2 million. That would be the house across the street from me.

Exactly, when I buy a new house, I pay for the market value and not what it cost the builder to build it which should be less than the sale prices or the builder will quickly be out of business.