If you’re a homeowner or planning to buy a home in Central Texas, understanding property taxes is one of the most important parts of the process. Property taxes help fund schools, roads, and other essential community services—but if you’re new to Texas or just moved to the area, it can be a little confusing to understand how they’re calculated and why they vary from city to city.
At Holley Homes Realty, we believe in helping homeowners make confident and informed decisions. Here’s a simple, clear guide to how property taxes work in Texas, what affects your rate, and how you can manage or even lower your bill.
Texas doesn’t have a state income tax, which means property taxes play a major role in funding local governments. Each year, your local County Appraisal District (CAD) determines your property’s assessed value based on market trends and comparable sales.
That value is then multiplied by your local tax rate—which includes contributions from your county, city, school district, and special service districts. The total equals your annual property tax bill.
You can check your current appraised value through your county’s website, such as the Travis Central Appraisal District or Hays Central Appraisal District.
Property tax rates vary across regions, but in Central Texas, they generally range from 1.8% to 3.5% of your home’s appraised value.
For example:
You can also explore current listings in these areas using our Search Tool to get a better sense of how tax rates align with home prices.
There are a few ways to potentially reduce your property tax bill each year:
1. File for a Homestead ExemptionIf the home is your primary residence, you may qualify for a Homestead Exemption, which reduces your taxable value and can save hundreds of dollars annually. You can apply for free through your local CAD’s website.
2. Protest Your AppraisalIf you believe your home’s assessed value is too high, you have the right to file a protest. Provide evidence such as comparable sales, recent appraisals, or repair estimates to support your case.
3. Explore Other ExemptionsThere are additional exemptions for seniors, veterans, and homeowners with disabilities. These can offer meaningful relief on annual property taxes.
Property tax bills are usually mailed in October and must be paid by January 31 of the following year. Payments made after that date will accrue penalties and interest.
When buying or selling a home, taxes are prorated at closing. The Holley Homes Realty team and your title company will walk you through the details to ensure everything is accurate and paid correctly.
Most Texas homeowners pay property taxes through an escrow account with their mortgage lender. This means your taxes are split into monthly payments, helping you budget throughout the year.
If your property’s assessed value increases, your escrow amount may rise as well. Our agents at Holley Homes Realty always review estimated taxes with buyers before closing to avoid surprises down the road.
Home values across Central Texas have seen steady appreciation—especially in Kyle, Buda, and South Austin. While this is great for building equity, it also means property taxes can rise over time.
It’s a good idea to review your appraisal each year and file a protest if the valuation seems inaccurate.
If you’re buying new construction homes, your first property tax bill might only reflect the land’s value. Once the home is complete, your taxes will increase to include the full assessed value.
Holley Homes Realty helps clients estimate their first full year of taxes so there are no surprises after closing.
In Texas, property taxes fund local services that make our communities thrive, including:
Your taxes directly contribute to keeping Central Texas communities safe, clean, and thriving.
Property taxes are one of the most important aspects of homeownership in Texas—but they don’t have to be overwhelming. When you understand how they’re calculated and what options you have to manage them, it becomes much easier to plan and budget.
Whether you’re a first-time buyer, a seasoned homeowner, or planning your next move, Holley Homes Realty is here to guide you through the process. Check out our Buyer Guide, explore listings, or get in touch to start your real estate journey with confidence.
Brandon Holley | Broker/Owner | Holley Homes Realty
512.487.9242 | brandon@holleyhomesrealty.com
⸻
Contact or Schedule
Contact Form | Schedule a Meeting
⸻
Connect on Social
YouTube | Instagram | Facebook | LinkedIn | TikTok
⸻
Search Homes
Search Homes in 78748 | Search Central Texas
⸻
Free Downloads
Buyer Guide | Seller Guide | New Construction Guide
⸻
Tools & Resources
Home Value Estimator | Mortgage Calculator
⸻
New Articles Daily
⸻
Compliance, Clarity, and Confidence
Keep reading other bits of knowledge from our team.
Have a question about this article or want to learn more?
