Comments on: Property Tax Re-Assessment

By: Art Eclectic

Art Eclectic — Sun, 14 Feb 2010 01:02:46 +0000

Gene, thanks…I figured as much.

“When the people find that they can vote themselves money, that will herald the end of the republic.”

- Benjamin Franklin

By: GeneK

GeneK — Sat, 13 Feb 2010 22:31:14 +0000

“In that case, the responsible thing to do is to buy & bail, so you get a permanent tax reduction instead of just a temporary one.”

If you bought your house strictly as an investment and only care about the money that would certainly be true.

“Educate me: why is it ok for property tax to drop when your house loses value but it is capped on the way up when gaining value?”

Because the majority of CA voters are homeowners who pay property taxes…

By: tj & the bear

tj & the bear — Sat, 13 Feb 2010 02:38:37 +0000

In that case, the responsible thing to do is to buy & bail

There appears to be a clause regarding “physical changes” to the property creating a new baseline; that could prove useful to those that really don’t want to move.

By: Art Eclectic

Art Eclectic — Sat, 13 Feb 2010 02:32:16 +0000

Educate me: why is it ok for property tax to drop when your house loses value but it is capped on the way up when gaining value?

That hardly seems appropriate. Why isn’t it the same limit of 2% going down as it is up?

By: W.C. Varones

W.C. Varones — Sat, 13 Feb 2010 00:52:42 +0000

tj & GeneK,

In that case, the responsible thing to do is to buy & bail, so you get a permanent tax reduction instead of just a temporary one.

By: GeneK

GeneK — Sat, 13 Feb 2010 00:43:50 +0000

We had a reduction on our previous home during the 2003 slump in San Mateo County. The assessment was reduced, and remained reduced until the comps showed the house had returned to its original Prop 13 level. At that point, the assessment was raised to original Prop 13 level plus a 2% increase for each year that had passed since purchase. IOW, our “normal” assessment for the year it was raised back was the same as it would have been had it never been reduced temporarily.

By: tj & the bear

tj & the bear — Sat, 13 Feb 2010 00:33:25 +0000

Somebody better figure that out because it will make a huge difference eventually.

The courts aren’t taxpayer friendly, even when the law is on the taxpayer’s side:

http://www.propertytaxrefunds.biz/

By: W.C. Varones

W.C. Varones — Fri, 12 Feb 2010 23:15:55 +0000

Rob Dawg,

Somebody better figure that out because it will make a huge difference eventually.

Jim’s interpretation could mean double the property taxes forever for some houses relative to your alternative interpretation.

By: Another Investor

Another Investor — Fri, 12 Feb 2010 23:15:19 +0000

The value is reduced under what was called Proposition 8 when it was passed by the voters sometime around 1980. Prop 8 allows for a temporary reduction in assessed value when the market value drops below the factored base (Prop 13) value AND for restoration of the factored base year value when the value increases above the factored base year value. The restoration was challenged in court by someone the last time values dropped and were restored, and he lost the case.

In most states, the taxing jurisdictions just raise the tax rate when values go down. That’s happening in Arizona now. In California the tax rate can’t be increased when the assessed values decline. Property tax revenue can actually decline. Or, as has happened since ERAF in the early 1990’s, the State can seize and redirect the money to ita coffers.

By: GeneK

GeneK — Fri, 12 Feb 2010 20:37:12 +0000

“Once reduced, the Assessor’s Office must then annually review the value of the property until the Proposition 13 value is fully restored (adjusted with the annual CPI, not to exceed 2%). Consequently, a new request for review is not required if your property currently has a temporary reduction under this provision.”

Yes and no. If you got a reduction last year and your home value hasn’t come back up you don’t need to request a review again this year to keep it, but if your property went down again, the annual review won’t automatically result in a further reduction. You’ll need to request another review for that.