Just got declined for a refinance loan because because your home’s value declined? Then you may want to check with your county assessor’s office to see if you qualify for a lower assessed value. Many states re-assess quarterly anyway, but in states like California, property taxes are approximately 1.2% per year and set using your purchase price plus improvements plus annual levies and inflation adjustments. So they remain pretty consistent, so if your area has declined in value significantly, you should take the initiative to find out if you qualify because you can’t count on the county to reduce your assessed value automatically. The San Francisco Chronicle just wrote a very useful overview on appealing your tax base.
The story discusses Proposition 13 and Proposition 8 which form the rules for property taxes in California. Proposition 13 says that property taxes are limited to 1 percent of the assessed value, plus additional property taxes for schools or local projects. In practice, the property tax rate across California counties averages about 1.2%. Proposition 8 is what would permit you to receive a temporary tax reduction. To qualify, your property’s value on January 1 of a given year must be lower than the prior year’s assessed value.
You will find the assessed value on your tax bill. Assessed value is usually your purchase price, plus the cost of additions or other new construction, plus an inflation factor not to exceed 2 percent per year. Other than these adjustments, the home is not reassessed until there is a change of ownership.