Guide · Updated July 29, 2026
How the Texas unequal-appraisal (equity) protest works
Texas gives commercial owners an appeal ground that has nothing to do with what a property would sell for: unequal appraisal, often called the equity ground. It asks one question — is this property assessed above the median of comparable properties, appropriately adjusted? Here is how the test works, straight from the statute.
The statute, in plain English
Tex. Tax Code §41.43(b)(3) puts it almost this bluntly: a protest on unequal appraisal shall be determined in the owner’s favor unless the appraisal district establishes that the property’s appraised value is equal to or less than the median appraised value of a reasonable number of comparable properties, appropriately adjusted. Note who carries the load — once the ground is raised with a comparable-median study, it is the district that must show the value sits at or below the median.
The same test exists for the courthouse stage as §42.26(a)(3), and it rests on the Texas Constitution’s equal-and-uniform taxation requirement. In Harris County Appraisal District v. United Investors Realty Trust, the owner won a reduction to the comparable median even though the property’s own purchase price was higher — equal-and-uniform prevailed over market value.
The test, step by step
The whole argument is a short, checkable chain of arithmetic on the county’s own public appraisal roll:
The §41.43(b)(3) chain
| Step | What happens | Why it matters |
|---|---|---|
| 1. Unit value | Divide the subject's assessed value by its building area to get assessed $/SF. | Puts every property on the same yardstick regardless of size. |
| 2. Select comparables | Pull properties of the same class and submarket, within a similar size and age band, from the public roll — a reasonable number, typically 4–10. | The statute's test is against comparable properties, not the whole county. |
| 3. Adjust | Apply documented, rule-based adjustments for the remaining differences (building size, age). | This is the statute's “appropriately adjusted” — undocumented adjustments invite rebuttal. |
| 4. Take the median | The middle of the adjusted $/SF values — not the average. | The median is the statute's own word; one outlier comparable can't move it. |
| 5. Compare | Median $/SF × subject building area = the equitable-value estimate. If the assessed value exceeds it, the property appears over-assessed on equity grounds. | The gap, times the combined tax rate, is the annual amount at stake. |
Informational description of the statutory test. Any figure produced this way is an informational estimate — not an appraisal and not a professional valuation.
What “appropriately adjusted” really means
Two retail strips are never twins: one is larger, one is newer. Adjustments translate a comparable’s assessed $/SF into what a building like the subject would carry. Larger buildings tend to carry lower unit values, so a smaller comparable is adjusted down toward the subject’s size; a newer comparable is adjusted down toward the subject’s age. What makes an adjustment “appropriate” in practice is that it is documented, consistent, and conservative — a fixed rule applied to every comparable the same way, printed next to each one, so the review board can trace every number. Aggressive or unexplained adjustments are the fastest way for a study to be discounted.
Equity vs. market value — two different arguments
Unequal appraisal vs. market-value protest
| Market-value protest | Unequal-appraisal (equity) protest | |
|---|---|---|
| The claim | “The district's value is more than the property is worth.” | “The property is valued above the median of comparable properties.” |
| Statutory ground | Tex. Tax Code §41.43(a)/(b) (market value) | Tex. Tax Code §41.43(b)(3); §42.26(a)(3) on judicial review |
| Evidence it needs | Sale prices, income and expense data, or other market evidence | Assessed values from the public appraisal roll, adjusted, and their median |
| Sale prices required? | Usually — a problem in Texas, a non-disclosure state where sale prices aren't public | No — the test compares the district's own assessed values |
| Effect of SB 2063 (2025) | Unaffected | Districts and courts may not use market-value evidence to defeat the equity ground — the comparable-median study stands on its own |
SB 2063 (2025) amended §§41.43 and 42.26 to bar appraisal districts and courts from considering market-value evidence in unequal-appraisal cases. That legally hardens the pure-equity path: if the comparable-median study shows the subject above the median, the district cannot answer it by pointing at what the property might sell for.
Where the numbers come from
Every input to the equity test is public: Texas appraisal districts publish their full rolls in bulk — assessed values, building areas, class codes, neighborhood codes. That is why the equity ground is the computable one: the entire study can be built, checked, and re-run from data anyone can download. For the filing mechanics, see how the self-file protest process works; for the quick screening version of this test, see the over-assessment screening signals.
Questions owners ask
What does Tax Code §41.43(b)(3) actually say?
That a protest on the ground of unequal appraisal shall be determined in favor of the protesting party unless the appraisal district establishes that the property's appraised value is equal to or less than the median appraised value of a reasonable number of comparable properties, appropriately adjusted. Once the owner raises the ground with a comparable-median study, the rebuttal burden sits with the district.
How many comparable properties is a “reasonable number”?
The statute doesn't fix a count. The practitioner norm is roughly 4–10 comparables, and in Harris County Appraisal District v. United Investors Realty Trust the court accepted a study built on seven. What matters is that the comparables are genuinely of the same kind — same property class and a similar submarket, size, and age — and that the adjustments are documented.
What does “appropriately adjusted” mean?
Comparable properties are never identical to the subject, so their unit values are adjusted for documented differences — most commonly building size and age — before the median is taken. The adjustments should be transparent, rule-based, and conservative, so that anyone (including the district) can re-run the arithmetic and land on the same median.
How is an equity protest different from a market-value protest?
A market-value protest argues the district's value exceeds what the property is worth, which usually calls for sale prices or income evidence. An unequal-appraisal protest argues the property is valued above the median of comparable properties on the same appraisal roll — it compares the district's own assessed values, needs no sale price, and under SB 2063 (2025) cannot be defeated with market-value evidence.
Do I need sale prices or a licensed appraiser to raise unequal appraisal?
No. Texas is a non-disclosure state — sale prices generally are not public — but the equity test never asks for them. Every input (assessed values, building sizes, class codes) sits on the public appraisal roll the district itself publishes, and the statute's test is a median computation, not a professional valuation opinion.
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