Apartment Complex Property Tax Protest & Appeal

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Key Property Tax Stats

Last updated: October 9, 2026

If you own an apartment complex in Texas, you can protest the appraisal district's value to the ARB. The question is whether the district's value matches what the property would sell for, not whether the tax bill feels high. This page explains how apartments are usually valued, where the inputs go wrong, what evidence helps and how the Texas process works. For two-to-four-unit properties see our small multifamily page. TaxDrop does not guarantee a result, and not every apartment property is over-assessed.

How districts value apartments

The Comptroller says the income approach uses income and expense data to estimate what an investor would pay for a property's anticipated revenue stream, and that it is most suitable for properties frequently bought and held to produce income, such as apartments, retail properties and office buildings (Texas Comptroller). Under Tax Code §23.012, when the income method is the most appropriate, the chief appraiser must:

estimate gross income potential from comparable rental data or earnings capacity;
estimate operating expenses from comparable expense data;
estimate capitalization or discount rates from comparable data; and
base projections of future rent or income and expenses on reasonably clear and appropriate evidence, considering historical trends, supply and demand, and competing properties under construction.

Value = NOI ÷ cap rate, so small input changes move the result a lot. The district may also look at sales and cost. Our income approach glossary entry has the basics.

A hypothetical example (made-up numbers, for illustration only)

These round numbers are invented to show the math. They are not data from any real property, market or TaxDrop client.

District inputs: NOI of $2,000,000 and a 6.0% cap rate gives $2,000,000 ÷ 0.06 ≈ $33,333,000.
Same NOI at 6.5%: $2,000,000 ÷ 0.065 ≈ $30,769,000, about $2,564,000 lower.
Same 6.0% rate but actual NOI of $1,850,000 after real vacancy and expenses: $1,850,000 ÷ 0.06 ≈ $30,833,000.

Whether any real property's inputs are wrong is a question for its own financials and market evidence.

Special situations

Rent-restricted housing: property owned by certain organizations and financed under the Texas low income housing tax credit program is subject to special appraisal rules in Tax Code §23.215. Confirm with your advisor whether your property qualifies.
Circuit breaker: the 20% yearly limit applies only to non-homestead real property valued at $5,320,000 or less for 2026 and expires December 31, 2026 (Texas Comptroller). Check your appraised value against that threshold.

Biggest Pain Points

Rents and occupancy that do not match your rent roll

The income method starts with an estimate of gross income potential, based on comparable rental data or the property's potential earnings capacity (Tax Code §23.012). If the district assumes rents or occupancy above what your property achieves, the value rises with them. Your rent roll and occupancy history show what the property actually earns.

Operating expenses that are too low

The chief appraiser must analyze comparable operating expense data to estimate your expenses and consider historical information and trends (Tax Code §23.012). Insurance, payroll, repairs, utilities and management costs are the inputs to compare against your operating statements.

A cap rate nobody has supported

The statute directs the chief appraiser to analyze comparable data to estimate rates of capitalization or discount (Tax Code §23.012). In an income valuation, net operating income divided by the cap rate gives value, so a lower rate produces a higher value. Ask the district for the data behind the rate it used (Tax Code §41.461).

How it Works

Evidence checklist for an apartment protest

Evidence works best when each document ties to a value input (Texas Comptroller; Tax Code §23.012):

Rent roll by unit type, with in-place rents, concessions and lease expiration dates.
Occupancy and collections history, including physical and economic vacancy, bad debt and turnover costs.
Operating statements for at least the past few years, so your NOI can be tested against the district's.
Property record card and unit mix to check units, square footage, age and amenities.
Market evidence: comparable sales, comparable rents and competing properties, including new supply.
Capital needs: inspection reports, bids and deferred maintenance that a buyer would price in.
The district's own evidence: its income model, expense data and cap rate support (Tax Code §41.461).

The Texas protest process and deadline

Deadline: file a written notice of protest with the appraisal review board (ARB) by May 15 or the 30th day after the appraisal notice was delivered, whichever is later (Tax Code §41.44). The Comptroller says the 30 days run from the date the district mails the notice (Texas Comptroller), so to be safe use the earlier date and check the dates on your own notice. A late protest can still be heard if you show good cause before the ARB approves the appraisal records.
Filing: use Form 50-132, or any written notice that identifies you, the property and your disagreement. A district cannot charge a fee for a protest (Tax Code §41.41). An agent needs Form 50-162.
Informal conference: you can ask the district for an informal conference before the hearing (Tax Code §41.445).
Before the hearing: the ARB must give you at least 15 days' written notice (Tax Code §41.46). You can ask the chief appraiser for the data, schedules and formulas it will use, which it must deliver at least 14 days before the hearing (Tax Code §41.461). Material you requested but did not receive in time generally cannot be used against you (Tax Code §41.67).
Hearing: on a market value or unequal appraisal protest, the district has the burden of establishing value by a preponderance of the evidence (Tax Code §41.43). Bring your own evidence anyway. Hearings are informal, and you may offer an affidavit, or appear by phone or videoconference (Tax Code §41.45).
Appeal options: regular binding arbitration is available only for a residence homestead or property valued at $5 million or less, so check your value against that threshold; SOAH or district court may also be available (Texas Comptroller).
After the ARB: you can appeal to district court within 60 days of receiving the written order. Depending on the property, State Office of Administrative Hearings (SOAH) appeals or regular binding arbitration may also be available (Texas Comptroller).

Our deadlines-by-state guide and Texas protest overview have more. For other states, see California, Georgia, Florida, New Jersey and Maryland.

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Apartment Complex Property Tax Protest: How to Appeal Your Assessment