Texas homebuyers quickly find their new mailboxes filled with solicitations and requests after their purchase. They are also overrun with appeals and demands for information regarding the purchase of their property.
In addition to the sham mortgage insurance offers and tax
filing service scams are enticements to disclose the sales price of their
property. Most of these communications look very official and it can be hard to
decipher what is legitimate and what is not. Almost none of it is.
Texas is a
non-disclosure state
In Texas, a buyer or seller is not required to disclose the
sales price of a property to anyone or any entity whatsoever. Real estate sale
prices are not public record.
In most states, you can look up any address through the
county property tax appraiser to see the most recent sales price. The public
has access to sales prices in 38 states. In some states, the public disclosure
of real estate sale prices may be printed in local media or appear on the
publicly recorded deed. In other ‘disclosure’ states, only governmental
entities have access to the sales price.
Our state considers a property sale to be a private
transaction and you have a right to keep the details away from curious folks as
well as government agencies.
With whom should you
share your sales price?
There is no law that says the state, county, city or appraisal
districts can require you to provide your sales price. Nosy neighbors and
relatives may also ask or speculate about what you paid for a property. It is
nobody’s business.
You do not need to disclose the purchase price to the County
Tax Office, your HOA, an appraiser, prying neighbors or anyone else. Your tax accountant
is the only person with whom you should share the purchase price of a property.
Why does the County
want to know?
Many Texas appraisal districts want full disclosure of real
estate sales prices to help establish the taxable value. Texas has no state
income tax. Our high property taxes help make up for that. Texas property taxes
are assessed and paid by counties, cities, schools, appraisal districts, etc.
The total property taxes average about 3% of the assessed value of the property
each year. If your tax assessor has your actual sales price, they will usually
base your taxes on that price.
Zestimates &
Other guessers
Web sites like Zillow attempt to place a “home value” on a
property based on different formulas. The estimated sales price and value
posted on most web sites are inaccurate. These automated valuation models
include limited information gathered from publicly recorded mortgage liens, tax
assessments and geographic maps.
Their estimates do not include actual sales prices or take
into account data such as negotiated concessions, repairs, closing costs, etc.
that one of the parties may have paid. They do not take into account lot sizes,
condition of the property, etc. Only licensed Realtors and Appraisers have
access to all of this information.
Who really knows the
sales price?
The buyer, seller, agents, title company and mortgage lender
all know the sales price of a property. If a property is for sale in the
Multiple Listing Service (MLS), then the listing broker must report the sale
and sales price to the MLS. The MLS collects and maintains this proprietary
information.
Property owner information, not sales price, is public information.
Marketing and sales companies scour county records every day and collect
information on deed transfers and filing of mortgage liens. That is where they
find the addresses of new homeowners to solicit. A lot of the junk mail will
also come from folks who find you when you turn on your utilities. That is also
public information unless you request that that the utility provider make it
private.
How to reduce requests
What should you do when faced with an official request
asking for the details of the sale? Ignore it. There is enough information out
there about all of us already. In my opinion, no one should offer up this additional
financial and personal information voluntarily.