2345: Save $1,100 on Average: Lowering Your Home's Property Tax Bill with Ownwell CEO Colton Pace

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I'm Russell Gray, Main Street Capitalist show and the founder of the Raising Capitalist Foundation. I'm here at the Jason Hartman Empowered Investor Live event. It's my first time being here, having a great time. I got a chance to see Sharon Lechter speak. I've never seen her speak. I've known her for years. Never heard her speak. She was amazing. Of course, Tom Wheelwright was amazing. Jason had a lot of great things to say. What I really like about it is the big picture stuff, tax strategy, legal strategy, but they also get down in the weeds is how do you actually execute, how do you find properties, how do you manage properties, how do you automate, how do you keep yourself in the 21st century? So if you're serious about your real estate investing, your real estate portfolio, this is a great place to be. Lots of great resources, lots of great energy, a lot of great information, and hopefully I'll see you at the next one.

Welcome to the Creating wealth show with Jason Hartman. You're about to learn a new slant on investing, some exciting techniques and fresh new approaches to the world's most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine, self made multimillionaire who's actually been there and done it. He's a successful investor, lender, developer and entrepreneur who's owned properties in 11 states, had hundreds of tenants, and been involved in thousands of real estate transactions. This program will help you follow in Jason's footsteps on the road to your Financial Independence Day. You really can do it. And now, here's your host, Jason Hartman with the complete solution for real estate investors.

It is my pleasure to bring you a show on a topic that is of great importance to you because it's an easy way to save money on property taxes. In fact, it's very, very easy. I am a customer of this company and I liked it so much I wanted to get them on the show. So it's my pleasure to welcome Colton Pace. He's the founder and CEO of OwnWell and we're going to talk about just found money. You should definitely take advantage of this. It's easy to do and you can save on some property taxes. Colton, welcome. How are you?

Thank you, I'm doing great, thanks.

Good, good. So you've been in business for about five, six years now and you've got a background in asset Management, family offices, all that kind of stuff. And I assume that with your high, high net worth family office clients, like one of them co founder of Microsoft, you saw all of their properties, right? And you saw that they were overpaying on property taxes. So you got into the business of helping dispute tax assessments and reduce these property taxes. And this is just a no brainer, like everybody should do this because your properties are likely over assessed and well, I don't know, is that likely? I mean I did it with a couple of mine and your website came back and told me they were fairly assessed, but next year that may change. Right? Talk to us about that.

Yeah, yeah. So disputing your property tax assessment or pushing back on that assessment, every single year you get a new assessment. It's like they're throwing a zestimate on your home or your real estate. And corporations, wealthy individuals, people who have attorneys, tax consultants, they always check, they always look into it and they typically always fight it. And so there's a lot of opportunity out there to say like, hey, this isn't fair, we know more about the property than the assessor does. Let's go in and tell them about it and make sure that they understand it's not worth that much. And in so doing that reducing your assessment reduces your tax bill. And so this is something corporations do every year. We just tried to bring it to the little man and help everybody and anybody with a $200,000 home or a $2 million home, we help, we help lots of different types of customers. 95% of people don't do anything, they just don't pay their, they, you don't fight a government bill. Right. Like that's not, that's a little foreign to us, but we see between 55 and 60% of people have an opportunity to save. And so for our clients we, we target, we reach out to people directly who we think we can save money. And so we save over 86% of our customers money.

Okay, so so does that mean 86% of the properties are over assessed in terms of tax bills?

Not necessarily. And so part of our marketing strategy is to identify properties that are over assessed and then reach out to those customers and get them to sign up. And so if you can't save money, you're likely not going to see our marketing material. If you do see our marketing material, you probably can save money.

And so so in other words, you're doing some data mining and advertising to the people who you think have over assessed properties.

Right, exactly. And so like I would say somewhere between 50 and 60% of assessments are potentially over assessed and worthy of an appeal.

Is there a model of what is likely to be an over assessed property, for example? I mean, our clients are doing mostly resident properties and I think that's your area mostly. Right?

Yeah.

I mean, do you do like large, expensive commercial properties too, at your company?

We, we work with, you know, industrial warehouses, large apartment complexes, farmland. Right. Like it's valuing real estate so we can do any and all, but we've started really facing the consumer and the consumer mostly owns homes and so.

Yeah, right, right. Okay. So you got about 140 million homes in the U.S. and, and so that's a big marketplace. Is there a certain model for properties, Colton, that would likely be over assessed? For example, is it a brand new property? I mean, I find that those are usually under assessed. Right. Or at least the first year they are and then maybe the second year they're way over. Or is it an older, like established property? Are they certain geographies where the tax assessors are just really aggressive and greedy? Tell us about that.

Yeah, everything in this business and in property taxes really depends on jurisdiction. And so our biggest geographies are Texas, Georgia, Long Island, New York, Chicago, California, and in that order. In Texas, we appealed the majority of cases that come across. In Georgia, it's more like 50 to 60%. And so depending on different areas, they're more aggressive. If you're looking at your assessment or you get a new assessment, it's all over the place. In certain geographies, the assessor's not actually allowed to know sales prices, which is a good thing.

And so if you just purchase, it's like the appraiser would. When they appraise a deal, they, you know, and they know the sales price on that's going to bias them.

Right, Exactly. No wonder an appraiser goes right to the sale price. It's like, yes, we don't want that to happen. And so that's why a lot of times they're under assessed initially when you just purchase a home because they don't know the price that you just paid, which is a good thing. Right. Like you don't want them to know your tax bill will go up. But in other cases, like make sure it's not totally crazy associated with your Zillow estimate or realtor.com estimate and make sure, look, if this price was real, would I sell the home today? If so, it's probably over assessed. Right. Like you have a better mental model in your head. Of what your real estate is worth. And then the other piece I was going to mention from there is that the diversity of your neighborhood. Right. Like we find great cases in a very diverse neighborhood. If you have a really old home next to a brand new home, it's much harder to compare those. Whereas if it's townhomes and they all look the same, those are probably much more closely assessed and more accurate. So that makes sense.

So in a, more, in a more conforming tract oriented area, the assessments are likely to be more accurate than they are in a non conforming area, you're saying.

Exactly. It's just easier to value that real estate because there's more data points saying like these sold. Yes, all worth this. Whereas if the brand new home in Beverly hills sells for $20 million, but the house built in 1970 next to it, that hasn't been renovated, like those aren't comparable. And so that's harder. And oftentimes there's more of an opportunity for us to save those individuals money.

Yeah. So, you know, mostly, I mean, obviously when you go to finance your property, refinance your property, or certainly sell your property, you want it to appear as valuable as possible. But when you go to get the taxes assessed, you want it to appear like it's a terrible property and it's not worth anything.

Yeah, I, I remember early days, I would get phone call, even when I was answering the phone, people would be like, why would I want to reduce the value of my property? And we're like, no, no, that's not what we're doing. Where your tax assessment has no connection to the actual value of what you could sell your home for, it's what your tax upon. And so you actually do want it as low as possible.

So when you have a more established neighborhood where, you know, some of the homes are completely remodeled and some are completely original, I mean, your system is pretty automated, I gather. But do you do anything to try and influence the tax assessor to get that lower price? Or how are you doing it behind the scenes?

Yeah. So depending on geography, there's different aspects of the tax code you can dive into. Like one that's really valuable for us is the, what we call the equity or uniform and equal case in that your tax assessment for a very the exact same home should be the exact tax assessment for someone else in your jurisdictions home of the exact same value. Right. And so if your neighbor's tax assessment is wildly different from a price per square foot perspective than yours, that's an argument. And so beyond just saying they sold their home for hire. I can talk about the cost of the real estate to replace it. I can talk about what tax assessments need to be fair and equal so I can compare them. And then I can also talk about sales in market, and then I could also talk about the income it could generate if it's. If we're looking at cap rates and the income value of a property. And so there's different valuation methodologies we use, and we usually look for the best one because they're all. All admissible, and then we approach it in. In that way. So usually we're trying to find the most creative approach. And when customers sign up for OwnWell, there's a quick survey at the beginning. If you have a damaged roof, cracked foundation, any leaks pool that needs repair. Right. Like something that's worth thousands of dollars, that helps us, and we can go and get a reduction on that basis too. And so we really want to get as much information from our clients to understand, like, and include in our evidence packet to go and get a reduction.

What is the average cost savings?

Yeah, we save customers on average, a little over eleven hundred dollars a year.

Okay, so did you hear that, folks? That's $1,100 per year on average. And if you've got 10, 20, 30 properties, maybe you've got 100 properties. Our investors have multiple properties, so that's pretty significant. And there's no cost to try it, right?

Yep. Yeah, OwnWell entirely operates on a contingency fee. And so if we save you money, we charge 25% of what we save you. And yeah, you're exactly right, Jason. Like, we have some clients who have thousands of properties, and we're saving them millions of dollars a year.

I tried this with a couple of my properties. When I put them in to your website, it just took me a couple of minutes. It was no time at all. I mean, does it take longer sometimes? Like you said, you wanted people to point out the defects or problems with their property to make it less desirable. Less valuable, right.

Yep. Yeah. Very simple path. Go to the website, omworld.com Enter your address. We'll give you a pretty rough estimate right there, but we want to go deeper into the facts. And you've gone through this process, Jason. You sign and authorize us to talk to the tax assessor on your behalf. Once we're done with that, we're your property tax agent and you can log off. Right. Like you're done. We can go get to work from there. If you want to give US more information. The survey continues and we ask for any, you know, recent appraisal you've had, any recent damage or quotes or insurance claims. Any of that information can be helpful. But you could sign up in a matter of minutes and then you could spend. There's a lot of information associated with we have recent crime in your neighborhood, we have permits that are being pulled in your neighborhood, we have what are your neighbors paying for insurance. There's a lot of information we have to use in our property tax appeals to give people an edge. And that information is shown to you as well. So, like, lots of information and projections for your next property tax bill. But you could sign up in a couple minutes and leave it and we'll get to work. And if we don't save you money or if we decide that you're over assessed, we'll let you know. And you should feel confident paying your tax bill, that a professional tax consultant has reviewed it and then we'll review it.

And that's what you did with me, by the way. You know, you said, hey, you know, I think your property's fairly assessed. There's not a dispute here, really. Which, you know, I wasn't terribly surprised about that, but I just wanted to.

Check, you know, no downside. Right. Like sign up, we will review it. It's not a computer. There's algorithms on top of people looking at every single property making sure that you shouldn't appeal. And if you shouldn't appeal, you should feel confident about paying that tax bill. And then when your next assessment comes, we'll do the exact same thing over again and entirely free. If we don't save you money, we'll do that for free as long as it takes until we save you some money.

Okay, so if you save me money, say it's $1,000 a year, it's going to cost 250 bucks. That's a real bargain. How long does it take you to determine? The first time I did, I kind of forgot about it. And then I got an email from you later. I don't know, maybe it was more than a month later, I think that said, hey, you know, we think this property is fairly assessed. Then I put another property of mine in there and I'm waiting to hear on that one. No, I think you said before we started actually that that one also was the same determination, fairly assessed. Those two were both in the same neighborhood, by the way, and they were pretty conforming those properties, so that's probably why. But what's the shortest and longest before you'll know whether or not you're going to be able to save some money.

Yep. Totally depends by geography and when you sign up. And so the deadline for Florida is in August and September. So we will wait to make that determination until close to August and September to get the most amount of information as possible, because we get your assessment probably in July in Florida. And then it takes us a couple months to make sure we have all the information in place to say, like, hey, you don't need to appeal or you should appeal. In Texas, it's April to May. In New York, it's in January. February. In California, half of the state is in November, half of the state is in September. And so it depends by geography. And then if we do appeal, the appeals in some jurisdictions take four to five months. And we'll keep you updated like, hey, we filed. Hey, we're going to the hearing. Hey, we're preparing for the hearing. And then in California, sometimes it can take up to 12 months. And we're working there behind the scenes just making sure. We're pushing as fast as possible to get you savings.

Yeah, okay. Okay, Good stuff. So people can do this right away. You've got a special offer. Jason hartman.com property tax we, we like you so much we became an affiliate with you. So go to jason hartman.com propertytax if you want to just take a couple of minutes. It takes no time at all to just put some property addresses in there and let them see if they can save you money. No harm, no foul. Really simple. And do you do this everywhere in the country? Is every jurisdiction covered?

I wish. We're working on it. We do it across 10 different states and we're honestly building wait lists to open new geographies. And so no matter what, put your properties in there. We'll let you know when we're open in your geography. But our main geographies today are Washington State, Texas, California, Georgia, Florida, Illinois, New York, Michigan, Pennsylvania and Colorado.

Okay, so there's some big markets in there that you mentioned where our people are buying rental properties and own rental properties. So that's good. But some of the other markets are where they're likely to own their personal residence. For example, California for sure. You know, we have tons of clients that own personal residences. California. So do this on your personal residence. Do this on your rental properties, all of the above, across the board. Try and save some money. Jason hartman.com Property tax takes just a couple of minutes and you'll circle back with them and tell them if you can save them some money. Anything else people should know? No.

Appreciate it. I think you guys got a good grasp. Let us get to work for you. Costs nothing if we don't save any money. So no downtime.

Costs nothing in terms of money and time. It's very little time. You can do this very, very quickly. Just takes a minute. Put a few of your property addresses in and let them see if they can save you some money. And that's again, one more time. Jason hartman.com propertytax Colton, thanks for joining us.

Of course. Thanks for having me, Jason.

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