In short
Since 2024, Texas has limited how fast the taxable value of most non-homestead real property can grow: no more than 20% a year. This is called the “circuit breaker.” It covers things like rental homes, second homes, vacant lots and small business buildings. The limit ends after the 2026 tax year.12 Unless lawmakers act, owners of these properties could see bigger jumps in taxable value starting in 2027. Your own home with a homestead exemption keeps its separate 10% limit.1
The 30-second version
- What it is: a 20% yearly cap on the taxable value of non-homestead real property.1
- Who gets it: property worth $5,320,000 or less in 2026. Farm, ranch and timber land under special appraisal does not.1
- When it ends: Dec. 31, 2026. It is not in effect for 2027 unless lawmakers extend it.12
- Homeowners: your homestead’s 10% cap stays.1
How the cap works
Say a rental house had a taxable value of $300,000 last year. This year the appraisal district says its market value is $375,000. With the cap, the taxable value can go up only 20%, to $360,000 (plus the value of any new additions).1 Taxes are figured on $360,000. (Example is ours.)
The owner must have owned the property on Jan. 1 of the year before. The cap goes away when the property is sold.1
| Tax year | Most a property could be worth and still get the cap1 |
|---|---|
| 2024 | $5,000,000 |
| 2025 | $5,160,000 |
| 2026 | $5,320,000 |
| 2027 | No cap, unless the Legislature extends it |
What changes in 2027
- Taxable value can catch up. If a property’s market value grew faster than 20% a year, its taxable value was held below market value. In 2027 the cap no longer holds it down.2 The law’s own warning says this “may result in an increase” in taxes.2
- Your value notice changes. Until 2027, the appraisal district’s notice must say whether your property gets the cap. From Jan. 1, 2027, that line is no longer required.2
- This was set in 2023. The end date came from the 2023 tax-relief law (Senate Bill 2). In 2025, a House bill would have made the cap permanent. It needed voters to approve a constitutional amendment. No such amendment was on the November 2025 ballot, so the end date still stands.34
The other side (counterweight)
- For letting it end: the cap was sold as temporary. A cap means two similar properties can pay different taxes just because one was bought earlier.
- For keeping it: the cap made tax bills more predictable for small landlords and small businesses.
Questions to ask
- How many properties got the cap, by the appraisal district’s count?
- How will the appraisal district tell owners when the cap ends?
What you can do
- If you own a rental or business property, look at your 2026 notice. Compare the market value with the capped (taxable) value. A big gap means a bigger possible jump in 2027.
- You can still protest your 2027 value. See how to protest your appraisal.
- Watch the 2027 Legislature. It meets in January 2027 and can change this.
How much value the caps held down here
The appraisal district posts yearly certified totals by school district. Added up across the county, they show:5
| Year | Held down by 20% cap (not homes) | Held down by 10% homestead cap |
|---|---|---|
| 2024 | $375 million | $3.90 billion |
| 2025 | $603 million | $2.31 billion |
| 2026 | $910 million | $839 million |
In 2026 the 20% cap held down more value than the homestead cap, about $910 million. In the Leander ISD area it was about $384 million.5 When the cap ends, the cap no longer holds that value down starting in 2027. So what: owners of rentals, shops and empty lots whose value is held down by the cap face that change in 2027.
Changes to this page
- Nov. 2, 2026: Removed our unmeasured readings about cost shifts and rents, and reworded hedges.
- Nov. 2, 2026: Added questions to ask.
What we still don’t know
- How many Williamson County properties got the 20% cap. The appraisal district’s yearly totals give the value held down, but not a count.
- Whether lawmakers will act in 2027.
Footnotes
-
Texas Comptroller, “Valuing Property” (circuit breaker limitation, Tax Code §23.231; 2024–2026 value limits; expires Dec. 31, 2026; homestead 10% limitation). https://comptroller.texas.gov/taxes/property-tax/valuing-property.php (read 2026-11-01) ↩ ↩2 ↩3 ↩4 ↩5 ↩6 ↩7 ↩8 ↩9
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Texas Tax Code §25.19(b), (g) and (o) (notice text for 2024–2026; versions effective Jan. 1, 2027 drop the circuit breaker statement; (o) warns that the limit “will no longer be in effect” from 2027 unless extended). https://statutes.capitol.texas.gov/GetStatute.aspx?Code=TX&Value=25.19 ↩ ↩2 ↩3 ↩4 ↩5
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Texas Legislature, 89th Regular Session, HB 1622 (introduced): would repeal the Jan. 1, 2027 changes from 2023’s SB 2 and make the limit permanent, but only if voters approved a constitutional amendment. https://capitol.texas.gov/tlodocs/89R/billtext/html/HB01622I.htm ↩
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Texas Secretary of State, ballot language for the Nov. 4, 2025 constitutional amendment election (17 propositions; none on this limit). https://www.sos.state.tx.us/elections/forms/proclamation-constitutional-amendment-%20elec-nov-2025.pdf ↩
-
Williamson Central Appraisal District, “1999 – 2026 Certified Values” spreadsheet (HSCapAdj and CBLCapAdj columns by school district, as certified; posted 2026-07-16), https://www.wcad.org/historical-data/. County totals are our math, adding the school-district rows (special Taylor ISD rows left out). ↩ ↩2