Texas Property Tax Consultant Exam -
Terms
Functional obsolescence - answer A flaw in construction, materials or design is known
as
(Income Producing) Personal Property - answer Property not permanently attached to
real estate and other assets such as inventories, furniture, and machinery
Capitalization Rate - answer The capitalization rate is the rate of return on a real estate
investment property based on the income that the property is expected to generate.
Net Operating Income - NOI - answer Net operating income equals all revenue from the
property minus all reasonably necessary operating expenses. Aside from rent, a
property might also generate revenue from parking and service fees, like vending and
laundry machines.
special use property - answer property that is taxed on 100% of market value less any
exemptions except
Escheat - answer Ownership passed to state if there are no heirs
Principle of Balance - answer Holds that value is created and maintained in proportion
to balance in the four factors in production.
Ad Valorem - answerTaxed according to value
For omitted BPP, how many years may a chief appraiser go back and add to the
appraisal roll - answer2 proceeding years
An acre of land contains - answer43,560 square feet
Legal Description - answerUsed to describe the physical location of real property, may
be metes and bounds, surveys, or lot and block
What is real property according to the Texas Property Tax Code? - answerland,
improvements, a mine or quarry, minerals in place and standing timber
Highest and Best Use (definition, meeting certain conditions) - answerThe reasonably
probable use of property that results in the highest value.
This simple definition will serve as a point of departure for examining
, the concept in the rest of this chapter.
To be reasonably probable, a use must meet certain conditions:
physically possible (or it is reasonably probable to
render it so).
legally permissible (or it is reasonably probable to
render it so).
financially feasible.
A taxing unit may elect to allow for split payments, with equal payments due before... -
answerDecember 1 and July 1
Effective gross income (EGI) definition - answerThe anticipated net income from all
operation of the real property adjusted for vacancy and collection losses. (DOESN'T
INCLUDE EXPENSES)
Income capitalization approach definition - answerAnalyzes the property's capacity to
generate future income to indicate the present value. This method of estimating market
value is generally used on property that is leased.
Chattel - answerPersonal Property
Appraisal Roll - answerA listing of all appraisal records, as changed by order of the ARB
and approved by that board, constitute the appraisal roll for the district. A listing of all
appraisal records within an appraisal district.
Depreciation - answerLoss of usefulness and value due to physical deterioration,
functionality, or economic conditions.
Gross Rent Multiplier (GRM) - answerA number, that when multiplied by a property's
gross rents, producers an estimate of market value. Appraisal districts may use a gross
rent multiplier primarily on residential property that is not owner occupied in lieu of other
appraisal methods if it produces the best estimate of fair market value. The multiplier is
derived from interest and risks rates common to the area much like the rates used in the
income approach to value.
Cost Approach to Value - answerMethod of estimating market value based on current
cost to replace, less depreciation. Using the cost approach to estimate market value is
one of three acceptable appraisal methods. Once the current cost to replace the
improvements is established, depreciation is deducted and the value of the land is
added to estimate current market value
Comparable Sales or Market Approach - answerMethod of estimating market value
using sales of comparable properties. Comparable sales approach, or market approach,
is one of the three acceptable appraisal methods for estimating market value. In single
property appraisals, recent sales of like properties are located and adjusted to the
subject property for age, size, amenities and other characteristics that effect value.
Terms
Functional obsolescence - answer A flaw in construction, materials or design is known
as
(Income Producing) Personal Property - answer Property not permanently attached to
real estate and other assets such as inventories, furniture, and machinery
Capitalization Rate - answer The capitalization rate is the rate of return on a real estate
investment property based on the income that the property is expected to generate.
Net Operating Income - NOI - answer Net operating income equals all revenue from the
property minus all reasonably necessary operating expenses. Aside from rent, a
property might also generate revenue from parking and service fees, like vending and
laundry machines.
special use property - answer property that is taxed on 100% of market value less any
exemptions except
Escheat - answer Ownership passed to state if there are no heirs
Principle of Balance - answer Holds that value is created and maintained in proportion
to balance in the four factors in production.
Ad Valorem - answerTaxed according to value
For omitted BPP, how many years may a chief appraiser go back and add to the
appraisal roll - answer2 proceeding years
An acre of land contains - answer43,560 square feet
Legal Description - answerUsed to describe the physical location of real property, may
be metes and bounds, surveys, or lot and block
What is real property according to the Texas Property Tax Code? - answerland,
improvements, a mine or quarry, minerals in place and standing timber
Highest and Best Use (definition, meeting certain conditions) - answerThe reasonably
probable use of property that results in the highest value.
This simple definition will serve as a point of departure for examining
, the concept in the rest of this chapter.
To be reasonably probable, a use must meet certain conditions:
physically possible (or it is reasonably probable to
render it so).
legally permissible (or it is reasonably probable to
render it so).
financially feasible.
A taxing unit may elect to allow for split payments, with equal payments due before... -
answerDecember 1 and July 1
Effective gross income (EGI) definition - answerThe anticipated net income from all
operation of the real property adjusted for vacancy and collection losses. (DOESN'T
INCLUDE EXPENSES)
Income capitalization approach definition - answerAnalyzes the property's capacity to
generate future income to indicate the present value. This method of estimating market
value is generally used on property that is leased.
Chattel - answerPersonal Property
Appraisal Roll - answerA listing of all appraisal records, as changed by order of the ARB
and approved by that board, constitute the appraisal roll for the district. A listing of all
appraisal records within an appraisal district.
Depreciation - answerLoss of usefulness and value due to physical deterioration,
functionality, or economic conditions.
Gross Rent Multiplier (GRM) - answerA number, that when multiplied by a property's
gross rents, producers an estimate of market value. Appraisal districts may use a gross
rent multiplier primarily on residential property that is not owner occupied in lieu of other
appraisal methods if it produces the best estimate of fair market value. The multiplier is
derived from interest and risks rates common to the area much like the rates used in the
income approach to value.
Cost Approach to Value - answerMethod of estimating market value based on current
cost to replace, less depreciation. Using the cost approach to estimate market value is
one of three acceptable appraisal methods. Once the current cost to replace the
improvements is established, depreciation is deducted and the value of the land is
added to estimate current market value
Comparable Sales or Market Approach - answerMethod of estimating market value
using sales of comparable properties. Comparable sales approach, or market approach,
is one of the three acceptable appraisal methods for estimating market value. In single
property appraisals, recent sales of like properties are located and adjusted to the
subject property for age, size, amenities and other characteristics that effect value.
