The last few years have been a good time to challenge the assessed value of your California home using the Proposition 8 process. Proposition 8 allows a homeowner to challenge the Proposition 13 value of their assessed home value. After the market decline in real estate, many homeowners were able to reduce their property tax this way. Home prices are now heading up quickly.
The Sacramento Bee just reported year over year price increases on Sacramento County homes of 31%. By the way, I find it interesting that the economists quoted in this article downplay the rise in home values. I think economists have underestimated the rise in home values for months now and I still think they are behind the curve. Of course, that is just educated guess on my part. This rise in home values, though, means that those that took advantage of the Prop 8 reduction in home values could see a rise in their property taxes. As the Sacramento County Assessor's Website (http://www.assessor.saccounty.net) states,
"It is important to understand that Prop 8 reductions are not permanent and may decrease or increase more than 2% from year to year. Also, Prop 13 base year values suspended by Prop 8 values continue to increase by an annual inflation factor of no more than 2% per year."
This means that property values can go all the way back to the original Prop 13 value plus an inflation factor. Please be prepared for the possible rise in your property's assessed value and the potential rise in your property taxes.
Raymond Henson GRI, CDPE, e-PRO, CNE
Hughes Real Estate
1101 Fulton Ave
Sacramento, CA 95825