In California, property taxes are typically 1.1% to 1.2% of a home’s value. This year, homeowners in Alameda, Contra Costa, San Mateo, and Santa Clara counties are getting a property tax cut for 2023-24. Why? Because home prices have dropped, causing these counties to lower the value they use to calculate taxes on homes and condos sold last year. Notably, San Francisco hasn’t seen such reductions since 2020-21.
However, there’s a catch. Only homes that have new owners or have been recently built or improved can get these tax cuts. That’s due to Proposition 13, which caps the yearly increase in a home’s value for tax purposes at 2% unless there’s been new construction or a change in ownership.
What if a home’s market value on January 1 is less than the value used for taxes? Here, Proposition 8 comes to the rescue. It mandates that the value for taxes should be lowered to match the market value. If prices increase, the value for taxes can rise too until it matches the original value. Beyond that point, increases are capped at 2% a year unless there’s new construction.
Over the next few months, homeowners who received an unsolicited reduction will be notified of their property’s new value. Every year thereafter, the assessor will review it and inform the homeowner of any potential changes. If you, as a homeowner, feel your home was worth less on January 1 than its 2023-24 assessed value, you can ask your county assessor to review it. Some counties may ask for sales prices of similar neighborhood homes.
If you disagree with the outcome of the review, you can take it up with your county’s assessment appeals board. Just remember, deadlines for this vary by county.
For residents of Alameda, San Francisco, or Santa Clara County, there’s an added advantage. You can get an early look at your assessments thanks to a special notice in July.
If you have more questions about your property’s value or how to ask for a tax reduction, don’t hesitate to reach out! I’m here to assist you.
