Category: Property Taxes

Monday, September 15th was the deadline to appeal your property taxes.  There was a flood of coverage about the deadline and my wonderful, loving husband asked me, “Honey, can we apply to reduce our property taxes?”  Being the patient and loving wife that I am, I ignored the fact that he has asked me this question 3 times!  It’s okay, I know that many people are discussing this and if my husband, spouse to a Realtor, insists upon asking several times, maybe I should explain for everyone’s benefit.

Next time he asks, I’ll just send him a link to my blog!  :)

We’ll use the example of my home.  We purchased our home in February 2002 and our assessed value has gone up 2% every year since the time we purchased it.  To figure out your assessed value, the general calculation is the purchase price + 2% annually (unless you’ve had increased assessments due to improvements like a pool or an addition) but you can also look for the assessed value on your property tax bill.

The purpose of the appeal to reduce taxes in the case that current market value is less than assessed value.  Remember, the assessed value is how they calculate your property taxes.  In our example, our assessed value of the February ‘02 purchase price is still less than market value so there is no need to file an appeal for property taxes.

As of right now, we are currently at November 2003 pricing.  If you purchased your home prior to November 2003, you are not likely to qualify for a reduction in your property taxes.

For More Information About Assessment Appeals and Property Taxes, check out the following links:

  • Property Tax Appeals Rise to 5,000; deadline is Monday
  • Should I file an Appeal?
  • Key Property Tax Dates

I’ve had a few conversations with people about property taxes recently.  With the declining property values, some homeowners have recently applied to have their property values reassessed.

And then… the Property Value Notice came from the Office of the Assessor for Orange County increasing our Assessed Property Value 2% from last year.  Many are asking, what’s up?

Note the text in your letter – ‘The Factored Base Year Value is based on the market value of your property when it was aquired, PLUS any new construction, PLUS an inflation factor of no more than 2%.  The Factored Base Year Value is the maximum taxable value allowed under Proposition 13.’

Market conditions may not be increasing in values, but inflation is a factor

Also, for many homeowners, their Total Assessed Value is still less than Market Value.  Keep in mind, as much as it may be a bummer to have a 2% increase annually, it has been very beneficial to homeowners to have only a 2% annual increase in markets that were seeing 20%+ increase in values year over year.  In many areas of the country – that increase would be significantly higher based on the market conditions.

If you feel the Total Assessed Value is higher than Market Value, apply to the County for a Reassessment.  There are stipulations and restrictions (comps for Bank Owned sales and Short Sales are considered Distress Sales and will not be included), but you can have a reduction in your Total Assessed Value if the comparable sales are there.

Property owners that disagree with the taxable values on their June Taxable Value Notice can file an application for assessment appeal with the Clerk of the Board of Supervisors.  They use the perceived value as of January 1st, 2008 for the upcoming tax bill.  You may file your appeal between July 2 and September 15th of this year.  You may go to www.ocgov.com/cob for the necessary forms.

Try not to feel too badly about the 2%, especially if you’re Assessed Value is under Market Value.  Believe me, when you look at some of the other areas in the country, it’s not really not a bad deal.

 

 

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