Texas’ New Law On Yearly Property Appraisals: What Homeowners Should Know

Key Takeaways: 

• New Appraisal Requirement: House Bill 2786 mandates annual reappraisals for properties in counties with populations over 75,000, starting in the 2026 tax year.
• Greater Transparency: Appraisal notices will include clear valuation breakdowns and comparables, helping property owners better assess and protest their values.
• Limited Protections: While homesteads are still protected by a 10% cap on taxable value increases, other properties, like rentals and commercial parcels, face no such limits under the new schedule.

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In 2025, Texas enacted House Bill 2786, mandating annual property reappraisals in counties with populations exceeding 75,000, effective from the 2026 tax year. This legislative change aims to standardize appraisal practices across the state, ensuring more consistent and transparent property valuations. For property owners, this means more frequent assessments, requiring increased vigilance to ensure valuations accurately reflect market conditions and property characteristics.

In this article, we will delve into the implications of House Bill 2786 for Texas property owners, exploring how the new annual appraisal requirement affects both residential and commercial properties, and providing guidance on navigating the updated appraisal landscape to protect your investment.

Pushback Against Biannual Appraisals And What Comes Next

In 2024, the Tarrant Appraisal District (TAD) approved a plan to conduct residential property reappraisals only once every two years. While the intention behind this move was to streamline internal operations and reduce appraisal workloads, it quickly ignited a wave of concern across the state.

Critics of the biannual approach—including local school districts and state lawmakers—voiced serious reservations. School leaders warned that less frequent appraisals could disrupt state funding formulas that rely on timely property valuation data. Without consistent annual updates, several districts feared they could be flagged as underfunded or financially vulnerable. By November, that fear became reality, with at least seven districts designated at risk due to delayed valuation data.

At the legislative level, lawmakers raised alarms about fairness and legal uniformity. Appraisal standards are expected to be consistent statewide. If one county adopted a two-year cycle while others continued annually, it could lead to discrepancies in tax liability and legal complications for both taxpayers and appraisal review boards.

By early 2025, state legislators responded with House Bill 2786—a proposed law to standardize property reappraisal schedules and restore consistency across counties. Set to take effect in the 2026 tax year, the bill aims to make annual reappraisals the norm in counties with populations of 75,000 or more. This legislative push seeks to eliminate confusion, protect public funding, and ensure a level playing field for property owners across Texas.

At Icon, we only win when you do. You’ll never pay a dime unless we secure a reduction in your tax burden—because standing up for fairness should never come with upfront costs.

What House Bill 2786 Means For Property Owners

House Bill 2786 introduces a series of significant changes to how property values will be appraised across Texas—especially in larger counties. For property owners, this bill signals the start of a more standardized and transparent appraisal process beginning in the 2026 tax year.

Annual Appraisals In Counties With 75,000+ Residents

Under the new law, appraisal districts in counties with populations of 75,000 or more are required to reappraise all properties annually. This marks a departure from prior practices where reappraisals could be delayed for years unless triggered by specific events like sales or major renovations. Property owners can now expect yearly updates to their valuations, providing a more real-time reflection of market conditions—but also increasing the need to monitor changes carefully.

Consistent Appraisal Methods

To reduce inconsistencies across counties, the bill mandates uniform appraisal practices. Each district must follow clearer guidelines for how properties are valued, helping to eliminate dramatic valuation swings between comparable properties in different areas. This push for standardization should help create a fairer and more predictable tax landscape for homeowners and commercial property owners alike.

Transparent Appraisal Notices

One of the most homeowner-focused provisions in the bill is the overhaul of appraisal notices. These documents will now be required to include a breakdown of how values were calculated, complete with the list of comparable properties used and the mathematical adjustments made. This added transparency empowers property owners to better understand their appraisals and prepare more effective protests if they suspect an overvaluation.

Clarified Protest Procedures

While the right to protest an appraisal remains unchanged, the bill introduces clearer rules about how supporting documentation should be presented. Property owners will now have better guidance on what qualifies as valid evidence—whether it’s comparable property data, inspection reports, or contractor estimates. This can lead to a more streamlined and informed appeals process.

Preservation Of Key Exemptions

It’s worth noting that the final version of the bill does not alter existing property tax exemptions. Temporary disaster-related exemptions, the 10% cap on homestead increases, and circuit breaker protections for certain properties remain in place. These safeguards help ensure that while appraisal frequency is increasing, important protections for vulnerable or qualified properties are still intact.

What The New Law Means For Texas Property Owners

While the move to annual property reappraisals may seem like a bureaucratic adjustment, the implications for both residential and commercial property owners are far-reaching. This new appraisal cadence reshapes how Texans will plan for, respond to, and potentially challenge their property tax obligations.

Impact On Homeowners

Homeowners should prepare for more frequent valuation updates that reflect current market conditions. In rapidly appreciating neighborhoods, this can mean noticeable year-over-year increases in appraised values—and possibly, tax bills.

• Real-time market tracking: Because appraisals now reflect recent market highs, owners may see faster tax increases if values in their area rise sharply.
• Higher risk of errors: With values updated every year, there’s also a greater chance for mistakes—like outdated square footage, incorrect home features, or misclassified improvements—to go unnoticed unless closely monitored.
• Protests become more strategic: Reviewing annual notices carefully and responding early can help owners flag inflated values and submit evidence-driven protests backed by proper comparables and documentation.
• Limited protections: While homesteads benefit from a 10% annual cap on taxable value increases, this safeguard doesn’t apply to rental properties, second homes, or land. These assets are more vulnerable to sharp tax jumps if valuations spike.
• Possible relief in market dips: If local real estate markets experience downturns, annual reviews could help homeowners take advantage of lowered valuations in a more timely manner.

Annual reappraisals are coming fast—don’t get caught off guard. Icon offers personalized, data-backed strategies to help homeowners and commercial property owners take control of their valuations before they cost you.

Impact On Commercial Property Owners

For commercial property holders, including retail buildings, warehouses, and office spaces, the shift to annual reappraisals introduces more volatility and higher stakes.

• Budgeting challenges: Tax obligations tied to updated valuations can shift year to year, impacting business forecasts, investor returns, and operational planning.
• Market sensitivity: Sectors like industrial logistics or commercial office space fluctuate with demand. Annual appraisals may now reflect those changes more quickly—good or bad.
• Income-based comparisons: Commercial valuations often hinge on rental income, occupancy rates, and tenant mix. Appraisal districts will adjust values based on these factors, and owners must be ready to challenge inaccuracies.
• No cap protections: Unlike homesteads, commercial properties are not shielded from large annual increases, making it essential to catch overvaluations early and act decisively.
• Documentation is key: Successful protests in the commercial space often require financial statements, third-party appraisals, and condition reports. Gathering these ahead of notice delivery can be a strategic advantage.

In short, the new law demands a more proactive approach from all property owners. With reappraisals now occurring annually, awareness, documentation, and timely responses will be critical to keeping tax burdens in check.

Final Thoughts

The shift to annual property reappraisals in Texas marks a pivotal moment for homeowners and commercial property owners alike. What may seem like a procedural change carries substantial implications for financial planning, equity in taxation, and the responsibilities of property ownership.

With the passage of House Bill 2786, appraisal districts in larger counties are now required to deliver updated valuations every year—reflecting not just market trends, but also a push toward transparency, consistency, and timely data across the board. This change means property owners must become more engaged with their appraisal notices, ready to scrutinize values, identify inaccuracies, and act swiftly when something doesn’t add up.

Whether you’re managing a growing real estate portfolio or simply want to ensure your home’s value is assessed fairly, understanding the impact of this law is essential. Proactive property owners—those who track market changes, review notices thoroughly, and prepare well-documented protests when needed—will be best positioned to navigate the new appraisal landscape with confidence.

In the evolving world of Texas property taxes, staying informed isn’t just helpful—it’s necessary.

Frequently Asked Questions About Texas’ New Law On Yearly Property Appraisals

How do annual appraisals impact property sale timing in Texas?

Annual appraisals can influence when a property owner chooses to sell. If a sale is expected to trigger a higher valuation the following year, some owners may aim to close deals before notices are issued. Others may wait if they believe market values will drop, potentially reducing perceived tax burdens or making their property more attractive to buyers.

Can annual appraisals affect mortgage escrow payments?

Yes. Mortgage lenders often adjust escrow accounts based on projected property tax obligations. If your appraisal value increases due to the annual review, your monthly escrow payment could rise to cover the new estimated tax bill.

Will this law impact new homebuyers differently than existing owners?

New buyers may face steeper adjustments shortly after purchase, as appraisal districts now have a tighter review cycle. This reduces the “lag time” some buyers previously benefited from before their property’s full market value was captured.

How can property owners prepare for a more aggressive reappraisal cycle?

Keep accurate records of improvements, repairs, and changes that may impact your property’s value. Photograph conditions annually, retain receipts for renovations, and track comparable sales in your neighborhood. These steps support you during protest season.

Do appraisal districts have the resources to handle annual reviews effectively?

Many districts may face logistical challenges due to staffing, budget limits, or outdated technology. While the law mandates annual reviews, execution may vary, especially in areas with high property volume or rapid development.

Are there any risks of tax fatigue from annual appraisals?

Yes. With yearly valuation notices, property owners may experience what’s known as “protest fatigue,” leading some to overlook or accept overvaluations due to the effort involved in challenging them each year.

Will commercial property tenants feel the impact of annual reappraisals?

Absolutely. Many commercial leases include tax pass-through clauses, meaning landlords shift increased tax burdens to tenants. Annual reappraisals could result in more frequent rent adjustments or operating cost hikes.

Can property owners request their own appraisal to dispute district findings?

Yes. Owners can commission an independent appraisal to support their protest. While this involves an upfront cost, it may offer persuasive evidence, especially in cases of significant valuation disputes.

Does the law impact how appraisal boards handle rural versus urban properties?

While the core requirements are uniform, implementation can vary. Rural areas may struggle to produce frequent, accurate comps due to lower sales volume, while urban areas may face scalability challenges due to density.

How might annual reappraisals influence gentrifying neighborhoods?

In rapidly changing neighborhoods, annual appraisals could sharply increase values year over year. This may result in higher taxes for long-time residents, intensifying displacement risks unless mitigated by local programs or exemptions.