How Property Tax Changes Are Affecting the Dallas Housing Market

By Steven J. Thomas

Direct Answer

Recent property tax adjustments across North Texas are reshaping how buyers, sellers, and investors make decisions. In a market as competitive as Dallas–Fort Worth, even a small tax rate change can affect affordability, demand, and pricing strategy.

In short: Lower property tax rates and higher homestead exemptions are providing relief to homeowners — but rising home appraisals continue to push annual costs higher for many DFW residents.

1. What’s Changing in Dallas Property Taxes

Texas lawmakers and local appraisal districts have recently introduced several measures impacting DFW homeowners:

Texas lawmakers and local appraisal districts have recently implemented several key measures that directly impact homeowners across the Dallas–Fort Worth area. One of the most significant changes is the increase in the homestead exemption from $40,000 to $100,000, which effectively reduces a home’s taxable value and saves most Dallas homeowners several hundred dollars each year. In addition, appraisal cap adjustments — currently under legislative review — aim to limit steep annual tax increases on non-homestead and investment properties by setting a 10% cap on value growth. Another major update is the school district rate compression, which lowers overall property tax rates by shifting a greater portion of funding responsibility to the state, helping ease the burden on local taxpayers. Despite these positive developments, county and city reassessments are ongoing, and many areas are seeing property value increases of 8–12% in their 2025 appraisals, which could offset some of the savings from lower tax rates.

💡 Quick takeaway: Even with lower tax rates, rising valuations mean most owners will see only modest savings unless their home’s assessed value stays flat.

📊 Source: Texas Comptroller, Dallas County Appraisal District (DCAD), NTREIS Market Data

2. How These Changes Affect Buyers and Sellers

For Buyers:

• Lower effective property taxes can expand buying power, allowing some to afford higher-priced homes.

• However, rising appraisals mean new homeowners should budget for tax increases after purchase, as exemptions often apply the following year.

For Sellers:

• High tax bills can reduce the buyer pool for mid-range homes.

• Listings that highlight updated exemptions or lower effective tax rates often get stronger engagement in MLS and Zillow traffic.

• Investment properties may face slower appreciation due to capped tax benefits.

🏡 Pro Tip: When marketing your listing, always include the most recent tax amount and exemption status — it builds trust and helps attract serious, qualified buyers.

3. Neighborhoods Most Impacted in DFW

Certain Dallas–Fort Worth markets are seeing the sharpest shifts due to appraisal growth:

• Frisco, Prosper, and McKinney: Rapid value growth driving higher appraisals despite lower tax rates.

• Dallas ISD zones: Benefiting most from school tax compression.

• Tarrant County (Fort Worth, Keller): Seeing stabilization thanks to consistent city rates and newer assessments.

📈 Example: A $550,000 home in Frisco with a $100K exemption now pays roughly $7,900 in annual taxes vs. $8,800 last year — about an 11% savings, depending on district rates.

4. The Bigger Picture — Market Behavior in 2025

Even modest tax savings are improving buyer confidence, particularly among first-time buyers and move-up homeowners.

• Increased demand in suburban DFW markets (Collin and Denton Counties).

• Stable pricing in higher-tax districts where relief is offset by rising valuations.

• Investor recalibration — many landlords reassessing cash flow models with new caps and rate changes.

💬 According to NTREIS data, listings mentioning “low taxes” or “homestead exemption” in the remarks receive 18% more views and sell 4 days faster on average.

5. How Sellers Can Leverage the Shift

Timing your sale or marketing strategy around tax changes can make a measurable difference:

• Highlight new exemptions and annual savings in your listing copy.

• Update your MLS tax data before going live — buyers notice.

• Offer documentation of assessed value or appeals in listing packets.

• Promote ownership savings in social and digital campaigns.

📅 Tool: “DFW Property Tax Impact Worksheet” — (available via Refind Realty DFW Seller Resources)

6. How I Help Clients Navigate Property Tax Changes

As both a Managing Broker and Loan Officer, I guide Dallas homeowners through the full picture:

✅ Reviewing appraisal notices and projected tax rates before listing
✅ Coordinating with title and lenders for accurate escrow estimates
✅ Helping buyers compare effective tax rates by ZIP code
✅ Advising sellers on pricing and positioning in shifting tax environments

📈 Resource: Get your Personalized Home Tax Impact Review → Refind Realty DFW

Conclusion

Property tax changes aren’t just numbers — they shape affordability, buyer confidence, and home values across Dallas–Fort Worth.
Understanding how these adjustments affect your specific neighborhood and price point can help you price strategically, buy smarter, and protect your long-term equity.

📅 Book a Home Goals Consultation to explore your tax outlook and market strategy today.

Key Takeaways

• Homestead exemption increases are saving many Dallas owners money — but rising appraisals limit relief.

• School tax compression is helping moderate-priced homes move faster.

• Buyers and sellers must factor tax implications into pricing and affordability.

• Highlighting low tax rates and updated exemptions can boost listing engagement.