Texas Property Tax Going Up Again in 2026: What Homeowners Should Plan For

Texas Property Tax Going Up Again in 2026: What Homeowners Should Plan For

Are Your 2026 Property Taxes About to Shock Your Escrow Account?

If you own a home in Texas, your Notice of Appraised Value (NOA) for 2026 has either already arrived or is on its way. For many homeowners across Harris, Fort Bend, Montgomery, Galveston, and Brazoria counties, the number on that notice is higher than last year. The good news: Proposition 13 (SB 4), approved by Texas voters in November 2025, raises the school district homestead exemption from $100,000 to $140,000, saving the average homeowner roughly $363 per year in school M&O taxes. The less-good news: that relief does not prevent your appraised value from climbing, and the compounding effect of the 10% homestead cap can still push your bill higher over several years. This guide walks through exactly how the Texas reappraisal cycle works, what changed in 2025 legislation, what Houston-area county data shows for 2026, and how to plan your budget so you are not blindsided by an escrow shortage in September or October.

TL;DR: Most Harris County homes in the $200,000-$450,000 range saw appraised values rise 1-3% for 2026, while homes above $450,000 rose 5-8%. Combine that with the new $140,000 school district homestead exemption (up from $100,000) and many mid-range homeowners will see modest net relief. But higher-value homes and properties that lost their homestead cap will face real increases. Your protest deadline is May 15 or 30 days after your NOA is mailed, whichever is later. Act now.

How Texas Property Reappraisal Works: CADs, NOAs, and the January 1 Snapshot

Texas has no centralized state property tax. Instead, 254 county appraisal districts (CADs) run annual mass appraisal of every parcel in their county, valuing each property as of January 1 of the tax year. Texas Tax Code Section 23.01 requires appraisal at full market value, and CADs must comply with the Uniform Standards of Professional Appraisal Practice (USPAP) when using mass appraisal methods.

Each spring, the CAD mails a Notice of Appraised Value (NOA) to property owners. Under Tax Code Section 25.19, single-family homesteads must receive their notice by April 1 (or as soon as practicable), while all other property gets notices by May 1. The notice shows:

• The prior year's appraised value and taxable value
• The current year's appraised value
• Any exemptions in place
• Whether the homestead cap (Section 23.23) limits your appraised value

The CAD does not set your tax rate and does not collect taxes. Tax rates are set separately by each taxing unit (school district, city, county, MUD, hospital district, etc.) in the late summer and fall after the appraisal roll is certified.

Protest deadline: May 15, or 30 days from the date the appraisal district mails your NOA, whichever is later. That date on the notice is the mailing date, not the date you received it. Missing this deadline means losing your right to contest the 2026 value at the Appraisal Review Board (ARB).

SB 4 and Proposition 13: The $140,000 Homestead Exemption (2025 Special Session)

The single biggest change affecting 2026 tax bills is Proposition 13 (Senate Bill 4, sponsored by Sen. Paul Bettencourt, R-Houston), which Texas voters approved in the November 2025 constitutional amendment election. According to Lt. Gov. Dan Patrick's office, the bill:

• Raises the school district general homestead exemption from $100,000 to $140,000 (Tax Code Section 11.13(b))
• Raises the senior (65+) or disabled homestead exemption to $150,000 (an extra $10,000 on top of the general exemption, consistent with the prior $10,000 senior add-on)
• Retroactively applied to 2025 tax bills
• Requires the state to compensate school districts for lost revenue through additional state aid (so districts do not absorb the loss)

Average savings: approximately $363 per year from the exemption increase alone. Combined with school tax rate compression already built into the 2025 state budget, the average Texas homeowner was projected to save roughly $497 annually. Since 2023, cumulative tax cuts (Prop 4 in 2023 + Prop 13 in 2025) amount to about $1,763 per year for the average homeowner, and $1,933 for seniors, according to the Lt. Governor's office.

For a quick illustration: if your home is appraised at $300,000 and you have the homestead exemption, you previously paid school M&O taxes on $200,000. Under Prop 13, you pay on only $160,000 -- a 20% reduction in your school taxable value.

The Texas Comptroller confirmed in its updated guidance that Tax Code Section 11.13(b) now reads $140,000, effective for the 2025 tax year and forward.

The 10% Homestead Cap: How It Works and When It Breaks

Under Texas Tax Code Section 23.23, a homestead's appraised value may not increase more than 10% per year, no matter how much the market value rises. HCAD explains the mechanics clearly: your appraised (taxable) value is capped at the lesser of market value or last year's appraised value plus 10% plus the value of any new improvements.

Example: If your 2025 appraised value was $300,000 and market value jumped to $350,000, HCAD can only raise your 2026 appraised value to $330,000 (10% cap). You are protected from the full market swing.

The cap kicks in on January 1 of the tax year after you first receive a homestead exemption. This means:

• Year 1 of homestead exemption: no cap protection (full market value applies)
• Year 2 onward: the 10% annual cap applies

When the cap "breaks" (resets to full market value):

1. You sell the home and new owners take title (their Year 1 has no cap)
2. The property loses its homestead exemption for any reason (rental, change of principal residence)
3. You buy a new home -- that home starts its cap clock fresh in Year 2

If your capped value is far below market value and you sell, buyers pay taxes on a higher base starting immediately. This creates a phenomenon in Harris County where identical houses on the same street pay very different property taxes depending on how long the current owners have held the property.

Statewide Trends and Houston-Area County Snapshots for 2026

Harris County (HCAD): Per the HCAD 2026 reappraisal news release, the county's housing market showed steady but modest growth in 2025. About 50% of homes increased in value, 37% decreased, and 13% stayed flat. Average sales price rose 2.5% to $426,558. Value changes by price range:

Total Harris County market value: approximately $938 billion across more than 1.9 million parcels.

Fort Bend County (FBCAD): Fort Bend CAD's 2026 Values page shows average urban residential sale price rising 2.54% to $470,752. Land values rose approximately 6% on average across Fort Bend school districts. The county added 6,486 new homes to the appraisal roll for 2026, reflecting continued growth in communities like Riverstone, Sienna, and Telfair.

Montgomery County (MCAD): Montgomery County has been among the fastest-growing in the Houston metro, with communities like The Woodlands, Grand Central Park, and Granger Pines driving continued demand. Protest guides from MCAD note that combined effective tax rates in Montgomery County can exceed 2.0% of appraised value, and 2026 protest deadlines follow the standard May 15 or 30-days-after-notice schedule.

Galveston County (Galveston CAD): Galveston CAD notes that the appraisal district may reappraise as often as every year when the market is active. NOAs are typically mailed mid-April.

Brazoria County (Brazoria CAD): O'Connor & Associates reported that Brazoria CAD raised single-family home values 2.9% in 2025 (the prior cycle), outpacing actual Houston Metro price gains of 1.2%.

School M&O Rate Changes After SB 2 and SB 4

Texas Senate Bill 2 (89th Legislature, 2019) established the revenue growth cap and no-new-revenue rate discipline that constrains school district M&O rates. Since 2019, the state has compressed school M&O rates by buying down rates with state funding.

Klein ISD serves much of the Spring/Cypresswood corridor and is one of the best data points for how this plays out locally. Klein ISD adopted a 2025-26 tax rate of $1.0119 per $100 valuation, the same rate as the prior year, and described it as the district's lowest rate in 33 years. The rate covers both M&O and Interest & Sinking (I&S, for bond debt). With the $140,000 homestead exemption now in place, a Klein ISD homeowner with a $400,000 appraised value pays M&O taxes on only $260,000 (after the $140,000 exemption), compared to $300,000 under the old $100,000 exemption.

Other school districts across the Houston metro have similarly held or reduced M&O rates due to state compression, but the I&S (bond) portion varies by district.

Worked Example: $400,000 Klein ISD Home in Spring (2025 vs. 2026 Tax Bill)

Let's build a real comparison for a homeowner in Spring, Texas, with a home in the Klein ISD attendance zone.

Assumptions: - 2025 market value: $400,000 - 2026 market value: $412,000 (3% increase, typical for mid-range Harris County) - 2025 capped appraised value: $385,000 (homestead cap from prior year) - 2026 capped appraised value: $385,000 + 10% = $423,500, but market value is only $412,000, so cap does not bind -- 2026 appraised value is $412,000 - Klein ISD tax rate: $1.0119 per $100 (M&O + I&S) - Harris County rate: approximately $0.3169 per $100 - Other taxing units (MUD, hospital district, city): approximately $0.40 per $100 combined

2025 Tax Calculation (with $100,000 school exemption):

2026 Tax Calculation (with $140,000 school exemption, new appraised value):

Net change: +$62 per year (roughly $5 per month), despite a $27,000 increase in appraised value. The $40,000 school exemption increase largely absorbs the appraisal growth for this homeowner. A higher-value home -- say, $650,000 -- with a 6% appraisal increase would see a more meaningful tax rise, since the school exemption covers a smaller fraction of total value.

How to Estimate Your 2026 Tax Bill from Your NOA

Your NOA contains almost everything you need:

1. Find your 2026 appraised value (or capped appraised value if you have a homestead exemption in place)
2. Subtract your exemptions -- the $140,000 school district homestead exemption (or $150,000 if 65+/disabled), plus any county or city local-option exemptions
3. Multiply by each taxing unit's rate (expressed per $100 of value). Your NOA lists each taxing unit.
4. Sum the results. The NOA may also include an estimated tax section that does this math for you.

Note: the tax rates on your NOA are last year's adopted rates (the new rates are not set until fall). The estimate is a reasonable approximation but may shift when October tax bills are sent.

Escrow implication: If you have a mortgage with an escrow account, your lender recalculates escrow annually based on the most recent tax bills. If your bill rises, expect an escrow shortage letter in September-November, followed by a required payment to cover the shortfall plus a higher monthly escrow payment going forward. CNBC reported in May 2026 that escrow-driven mortgage payment increases are a top surprise cost for homeowners in 2026. Setting aside a reserve of $300-$600 now gives you a buffer.

How to Protest Your 2026 Appraisal Before the Deadline

Every Texas homeowner has the right to protest their appraisal with the county ARB. The Texas Comptroller's protest guide outlines the process:

Step 1 -- File before May 15 (or 30 days from the NOA mailing date, whichever is later). File online at your county CAD's portal (HCAD iFile at hcad.org/iFile-protest, FBCAD portal at fbcad.org, MCAD at mcad-tx.org) or mail Form 50-132.

Step 2 -- Select your grounds. The two most effective are (a) market value is too high and (b) unequal appraisal (your property is appraised at more per square foot than comparable nearby properties).

Step 3 -- Gather evidence. Bring comparable sales (recent sales of similar homes in your neighborhood), photos documenting condition issues, and contractor repair estimates if relevant. For HCAD, you can upload evidence through the Owner's Portal for informal appraiser review.

Step 4 -- Attend the informal hearing first. HCAD and most Texas CADs offer an informal hearing where an appraiser reviews your evidence and may offer a settlement. Most Texas protests are settled at the informal stage. If the offer is unsatisfactory, you can proceed to a formal ARB hearing.

Step 5 -- Further appeals. If unsatisfied with the ARB result, you may appeal to state district court (within 60 days of the ARB order), to the State Office of Administrative Hearings (SOAH) for properties valued over $1 million, or to regular binding arbitration for homesteads or properties under $5 million.

For more guidance on the protest process specifically for Harris County homeowners, see our related article on Harris County property tax protest strategies.

Planning Calendar: What Homeowners Should Do Right Now

Use this timeline to stay ahead of 2026 property tax impacts:

Three money moves to make now:

1. Verify your homestead exemption is on file. Log in to your county CAD's portal and confirm the exemption shows on your account. It is not automatic for new buyers. If you purchased before January 1, 2026, you can still file for the 2026 exemption -- the deadline is April 30.

2. Set aside an escrow buffer. If your appraised value rose 3-8%, estimate the incremental tax increase and put that amount in savings. A $400,000 home that rises to $430,000 in appraised value could see a $90-$150 increase in annual taxes, which your servicer will spread over the next 12 months as a higher escrow payment.

3. Refinance timing. If you are considering a refinance, be aware that escrow recalculations after a refi reset your escrow account based on current tax values. Closing in fall after tax bills are set avoids a surprise shortage in the first year post-refi.

For deeper context on how the homestead exemption works for buyers and sellers, see our guide to Texas homestead exemption basics.

And if you are wondering whether it makes sense to buy vs. stay in your current home given rising carrying costs, our post on Texas property tax caps and what they mean for buyers walks through the cap reset math in detail.

Frequently Asked Questions

Can my appraised value go up more than 10% if I have a homestead exemption?

Under Tax Code Section 23.23, the 10% annual cap is firm for properties with an active homestead exemption in both the current and preceding year. However, the cap applies to appraised value, not market value. HCAD and other CADs must still appraise your home at full market value on their records; the cap simply limits the taxable appraised value used for your bill. If you let your exemption lapse (by failing to file or by renting out the property), the cap breaks and your appraised value can jump to full market value in one year.

What does the $140,000 homestead exemption actually mean for my tax bill?

The $140,000 exemption reduces your taxable value for school district M&O purposes only. If your home is appraised at $350,000, you owe school taxes on only $210,000. At a school M&O rate of roughly $0.83 per $100 (typical compressed rate in many Houston-area ISDs), that is a savings of about $332 per year compared to the old $100,000 exemption, which taxed you on $250,000. County, city, and MUD rates still apply to the full appraised value (less any local-option exemptions those entities may offer).

My NOA was mailed April 18. Is my protest deadline May 15 or May 18?

Your deadline is the later of May 15 or 30 days after the mailing date on the notice. If your notice was mailed April 18, the 30-day window runs to May 18, which is later than May 15. Your deadline is May 18. Always use the mailing date printed on the notice itself, not the date you received it in your mailbox.

I just bought my home in 2025. Do I have the 10% cap in 2026?

No. The cap takes effect on January 1 of the year following the year you first receive a homestead exemption. If you filed for and received the homestead exemption for the 2025 tax year, the cap begins protecting you starting January 1, 2026 -- meaning your 2026 appraised value is capped. But if you purchased late in 2025 and did not file for exemption until 2026, the cap would not start until January 1, 2027. Check your county CAD portal to confirm whether your exemption is showing for 2025 or 2026.

Will the higher appraised value increase my homeowner's insurance?

Not automatically. Homeowner's insurance is based on replacement cost (what it costs to rebuild the structure), not appraised market value. However, if HCAD or another CAD raises your appraised value partly because of improvements or additions you made, and you have not updated your dwelling coverage to reflect those improvements, you may be underinsured. Review your policy's Coverage A (dwelling) limit whenever you make significant additions or renovations.

What if I miss the May 15 protest deadline?

Missing the deadline is not always final. Under Tax Code Section 25.25, you can file a motion for correction if the appraisal district appraised your homestead at least one-fourth higher than its correct value (one-third for non-homestead property). You must file and pay the undisputed portion of taxes before the delinquency date. You may also protest if you never received the notice the district was required to send. Outside of those specific remedies, the ARB generally will not hear a late protest without good cause shown.

Talk to a Spring-Area Agent Who Knows Harris County Property Taxes

Rising appraisals, new exemption rules, escrow adjustments, and protest deadlines all affect the true cost of owning a home in the Houston metro. Whether you are planning to stay, sell, or buy, understanding your tax picture is a key part of your financial planning.

Erick Harbert at the Harbert Real Estate Group at Realty Right works with homeowners across the Spring, Klein, The Woodlands, and greater Houston area every day. Erick can help you understand how 2026 appraisal trends affect your home's value, factor property tax carrying costs into a buy-or-sell decision, and connect you with local protest resources.

Reach out directly:

• Phone: (281) 305-2520
• Email: [email protected]
• Office: 6605 Cypresswood Dr Ste 300, Spring TX 77379
• Website: harbertgroup.com

Sources: Texas Comptroller Property Tax Exemptions; Texas Comptroller Valuing Property / Section 23.23; Texas Comptroller Appraisal Protests; HCAD 2026 Reappraisal Values News Release; HCAD Capped Appraisal Values; Fort Bend CAD 2026 Values; Lt. Gov. Dan Patrick statement on SB 4 / Prop 13; Klein ISD 2025-26 Tax Rate; Community Impact Klein ISD Tax Rate; CNBC Escrow Shortages 2026