Tag: Agricultural Exemption

  • You’re Better Off Knowing, Even If It Hurts At First

    You’re Better Off Knowing, Even If It Hurts At First

    Last week I put together an MBR Land Reality Check for a Collin County acreage owner.

    I went through the comparable sales, looked at the utility situation, and worked through it the same way I would if it were coming to market, whether it actually ends up happening or not.

    The projected value range came in meaningfully below what the county currently has it assessed at.

    That’s something I’m seeing more often lately.

    For a long time, if you saw a rural tract priced at or below tax value, it at least got your attention. It didn’t always mean it was a deal, but it was usually worth a closer look.

    That’s not as reliable as it used to be.

    In a number of cases now, especially with more rural acreage, tax values appear to have caught up to, or in some cases moved ahead of, where the market would actually transact.

    It’s likely a function of the way values moved over the last several years.

    At the same time, most of these properties carry an agricultural exemption. So while the assessed value may be high on paper, the owner isn’t being taxed on that number.

    Which means there’s very little incentive to challenge it.

    If anything, it tends to have the opposite effect. A higher assessed value feels like a positive signal, even if it doesn’t reflect what a buyer would actually pay.

    That can create a disconnect.

    And in some cases, it matters more than people realize.

    If an agricultural exemption is removed, rollback taxes are calculated based on the assessed value. If that number is higher than it should be, the exposure is higher as well.

    I’m not going to get into the mechanics of that here.

    And to be clear, I’m not an appraiser. The MBR Land Reality Check isn’t designed for use in a property tax protest. If that’s the objective, a tax consultant or appraiser is better equipped for it.

    If nothing else, it gives you context.

    You don’t have to sell. You don’t have to even consider selling.

    But things change.

    And it’s a lot easier to make a good decision when you already understand what you have than when you’re trying to figure it out under pressure.

    So the question isn’t whether you’re planning to sell.

    It’s whether it makes sense to know where things stand.



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  • Check Both Tax Accounts

    Check Both Tax Accounts

    Yesterday I mentioned that even with experience, situations still show up that I have not seen in exactly that form before.

    You cannot coast.
    You cannot assume.
    You stay alert.

    This one worked out fine. Still, it bothered me.

    I am helping a client purchase property near the new Bois d’Arc Lake. We negotiated the deal, worked through issues, and negotiated a price reduction that required additional earnest money.

    Everything looked clean. Ready to go. I might have even started breaking my rule about assuming a closing, just a little.

    Then the closing statement came in.

    The property taxes were materially higher than expected.

    The understanding was that the property was under agricultural exemption. But according to the county, only part of it was.

    The property is in two separate tax accounts. A couple of years ago, the county had taken the ag exemption off one of the tracts.

    I had checked the ag status.
    What I failed to do was check both accounts.

    One showed ag.
    The other did not.

    It made no logical sense that one tract would qualify and the other would not, especially since the same farmer was working both. But logic and county records do not always move together.

    When I saw it, I felt it.

    I take pride in being thorough. And while I did verify the exemption, I did not verify it completely.

    That difference represented roughly a $10,000 per year swing in carrying cost.

    That changes value.
    That changes what a buyer can reasonably pay.
    That matters.

    I addressed it directly. No hiding it. No hoping it would slide through.

    Turned out it was a mistake on the county’s end. They reinstated the ag exemption, and we should be good to go. Assuming nothing else happens.

    From now on, every account gets checked. Every line item gets confirmed. Even when it “should” match.

    That is how you get better.

    And that is also why you use a professional.

    Not because professionals never miss anything.

    But because when something surfaces, it gets caught, addressed, and handled before it becomes permanent.

    Until a deal is closed and funded, it is still alive. And live deals require attention.

    Experience is not about perfection.

    It is about knowing where problems hide, and being willing to own them when they show up.


    PS – If you own land or acreage and want a clear, no-obligation opinion of value, I offer a free analysis based on real comps, tax data, utility access, and actual market experience.

    Land is different from residential. The details matter.

    You will know where you stand today and what realistic options actually look like.