Homestead Appraisal Cap (10%)
A Texas limit that holds the annual increase in the appraised value of a residence homestead to 10 percent, plus the value of new improvements.
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What does Homestead Appraisal Cap (10%) mean on the Texas real estate exam?
Answer: A Texas limit that holds the annual increase in the appraised value of a residence homestead to 10 percent, plus the value of new improvements.
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Homestead Appraisal Cap (10%) definition
The homestead appraisal cap limits how much the appraised value used for taxes on a residence homestead can rise from one year to the next. The increase is capped at 10 percent per year of the prior year's appraised value, plus the value of any new improvements added to the property. The cap is the Texas counterpart to other states' assessment caps.
The cap applies only to a qualified residence homestead, and it does not lower market value, only the capped appraised value used to compute taxes. When the home is sold, the capped value generally resets the year after the sale.
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Special Topics (Texas) (5 of 40 Texas State Law)
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