A question for CA real estate folks

[Stu Gotz]

I have some in-laws who are having some real estate issues. The following is part of the e-mail I received from them.

"Currrently our property taxes are based on a home value of $314,000, but this is probably low, but we won't know untill we get a home appraisal."

So my question is this - for tax purposes, does CA value homes at 70% of their value like they do here on the east coast? Or would the $314K be full appraisal value?

Thank you in advance.

[atomicboy]

for starters search prop 13 from 1978 to get a clear picture of property taxes for California.

I live in CA and property taxes are not based on the real value of your house. I bought my house for 280K 12 years ago so my base for property taxes was 280k. Each year they increase the assessed value of your house by 2% per prop 13. So each year my property taxes go up 2%. A couple of years ago I added a room and did it legit so I was reassessed based only on the increased value of the addition of 25K or so. So after 12 years and the addition I was assessed last year for $335 or somewhere around there for property taxes but the value of my home today is around $650k. People who bought 2-3 years ago for $700k and now it is worth $550k are going to the county and having the value reassessed for taxes from $700k down to $550k. However in my case I can't get reassessed because my base for taxes is still a lot less than the actual value of my home. I know it does not make sense but that is how it works in CA.

Edit - As for refy and appraisal it will have no bearing on the assessed value for property tax purposes. I refinanced for a lower rate back in 03 and it did nothing to alter my tax value base for my home

[ridefree]

Contact the county and you can most likely have the property re-accesed based on current home values. pretty easy and should drop your property taxes as well.

[Stu Gotz]

Thanks for the responses. The issue isn't tax-related. It's a question of whether the family helps the couple out of a pending issue housing affordability.

From their original e-mail, I don't have a good valuation benchmark.

Have real estate values fallen more than 20% from 2005 levels in a town just north of San Francisco?

[yonskion]

Contact the county and you can most likely have the property re-accesed based on current home values. pretty easy and should drop your property taxes as well.

Dream on..... here in Bend everyone has lost value, but the County is not lowering tax liabilities or assesed values. Once the Deschutes County gets there hands on revenue they will never give it back

[ridefree]

2005? most likely yes. maybe. depends on a number of factors

[tele58]

Im in SoCal and we had our taxes lowered by the county last year. They did a revaluation based on the decline in property values. Didnt even have to request it! It was based on comps and accomplished automatically in part to try and help homeowners. I was amazed that the county voluntarily relinquished tax revenue but I guess it was preferable to no revenue due to foreclosures and drastically diminished short-sale values. Sad part is our house is now valued ~20% less than what I paid in 03.

[jfost]

we are above 2005 levels in a town south of San Francisco - the peak was more like early 2008 here...

[irul&ublo]

It really depends which town, type of proerty, etc. Some bay area values plateaued in th 05-06 time frame, substantial drops were more like 07 on. So it's possible the value had decreased substantially between 05 and now

[Telenater]

The assessors office is required to reevaluate assessed values in a situation like this. You might need to remind them, but they're required to do so (at no cost to you).

The most common way that your property tax will get assessed down in California is if you've purchased relatively recently, and the house has lost value to drop below the purchase price. If you bought a while ago, and the house gained value but then lost it, unless the house has dropped below the Purchase price + 2% per year value, you're not going to get reassessed (and why would you want to, your taxes would go up).

Following purchase of a house, commercial home appraisals in California really only make a difference for refinancing or insurance purposes.

If your in-laws bought in 2005, and are paying taxes on $314k there aren't many ways that the taxes could go up (home improvements being one as mentioned above), right now, going down is the more likely outcome.

I'm not a lawyer, but I do deal with land use and land value data a lot in California so I'm reasonably familiar with Prop 13.

Insert coin for a soap box commentary on Prop 13.