The Dallas real estate market is booming. Prices are up — but so are taxable real estate values. Dallas County property owners are likely to get a significant shock with their tax bills: Taxable real estate values are up 11 percent on average.

Residential property tax rates increased by 9.9 percent across the county, while commercial tax rates are up 14.6 percent. The value of new construction increased 25 percent over last year.

However, the Dallas Central Appraisal District chief appraiser predicts these rates will come down as many property owners are expected to appeal the increases.

The appraisal district determines preliminary taxable values for the market. But property owners have until May 31 to protest the findings, with hearings on disputes until July 20. Final values are certified on July 25. Dallas County’s budget director Ryan Brown expects the final number after disputes will be closer to 7.23 percent. 

Property tax bills include funding for the school district, the community college district, the city, and Parkland Memorial Hospital.

The increase in tax rates reflects the high demand for housing and corresponding rise in home prices. The Dallas-Fort Worth metro area is one of the fastest-growing housing markets in the U.S. Nearby counties, like Tarrant and Denton, have seen similar increases in taxable real estate values in the past year.

Property taxes in Texas tend to be high in part because of the lack of a state income tax. However, the state’s residents often protest tax increases. Collin County, which includes the growing areas of Plano and Frisco, has faced its own public opposition to increased property taxes. The state held hearings in March about lowering property taxes, specifically noting that lower taxes would negatively affect funding for first responders.

Increased taxable real estate values reflect the hot market and are therefore a more positive sign than one of declining value. But local officials are also concerned about the increased cost of housing, particularly for lower-income residential property owners.