Home owners in San Diego County will be relieved to learn that while assessed property values have risen 6 percent over the last year, only a fraction of that will be reflected in their property tax bills. As of January 1, 2014, which is the day that values are compiled for property tax purposes, the assessed values of homes, boats, planes and business property collectively increased by $24.6 billion, according to the County Assessor.
Unlike in some other parts of California, where property taxes are being hiked up substantially, San Diego county will only see assessed values rise at rates less than 0.5 percent due to Proposition 13. This mandate was passed in 1978, and makes provisions for property values to rise for tax purposes no more than the California Consumer Price index or 2 percent, whichever is lower. Last year, the California Consumer Price Index, a value that measures inflation, was less than 2 percent and home owners did not get a break on property taxes during that time.
“During the great recession my office provided temporary reductions on over 210,000 residential properties because their current market value was less than their Proposition 13 value,” County Assessor Ernie Dronenberg said in a statement. “Each subsequent year we are required by state law to reevaluate these properties and adjust their values accordingly, but never exceeding the lesser of the market value or the Proposition 13 value.”
Approximately 575,000 homes, or 68 percent, qualify for the tax break this year, but with properties being restored back to their indexed property values, taxes could take a steep hike in the near future.
San Diego Eyeing Housing Recovery
Amid the reports of the new raised assessment values, market watchers in San Diego are murmuring of housing recovery as properties continue to gain equity back at an astounding rate. The area, which was largely affected by short sales and foreclosures, has made quick and steady progress in gaining value back for home owners and bringing many back above water after a period of uncertainty and crisis.
In total, San Diego County assessed property values have reached $433 billion this year, a 6 percent increase for the 2014-2015 tax year that is nearly double last year’s gain of 3.46 percent. At the peak of the housing bubble, when property values were at an all-time high, San Diego saw a staggering 13.34 percent jump for the 2005-2006 tax year. However, this extremely high value led to a horrendous bottoming out period characterized by three years of negative assessments and temporary property tax discounts that essentially ground to a halt any progress the county was making on construction and repairs in infrastructure.
While some San Diego home owners may be happy with the break provided by Proposition 13, others may have a rude awakening when they receive their statement in the mail. Property owners who wish to appeal their assessed values can do so through December 1, 2014.
Are you wanting to take advantage of all of the great aspects of living in and around San Diego? If so, contact our property experts as we’d love to show you some stunning San Diego real estate.