News

Property tax assessments to rise about 1.5 percent

 

San Mateo County property taxpayers should receive some welcome news with their 2016 tax bill. Because the state's consumer price index increased by only a little more than 1.5 percent during the past year, property tax assessments for properties that didn't have new construction or new ownership will rise by 1.525 percent in 2016, according to county Assessor Mark Church.

It is the third year in a row that property taxes have not increased by the 2 percent maximum allowed each year, but only the ninth time this has happened since Proposition 13 was passed 40 years ago.

When Proposition 13 was adopted by voters in 1975, it tied the assessed value of California properties to their value in 1975. If a property changes ownership or there is new construction, it is reassessed to current value. The assessed values increase based on any rise in the state's consumer price index for the previous year, up to a maximum of 2 percent a year.

Mr. Church said that while the news may be good for homeowners, government entities "may have to adjust their budget estimates" for the fiscal year starting July 1, 2016.

However, he added, the county's economy has been growing fast enough, with new construction and property changing ownership, that "economic growth will in all likelihood compensate for any reductions in roll value caused by the low inflation factor."

The property tax assessment is based on the California consumer price index between October 2014 and October 2015.

Comments

18 people like this
Posted by really?
a resident of Menlo Park: other
on Dec 15, 2015 at 11:00 am

really? is a registered user.

Good News! Taxes going up!


10 people like this
Posted by CPI-yi-yi-yi!
a resident of Menlo Park: Suburban Park/Lorelei Manor/Flood Park Triangle
on Dec 15, 2015 at 11:34 am

>> tied the assessed value of California properties to their value in 1975

Anyone holding real estate (residential, and especially commercial with all the commercial property loopholes) does not pay anything related to current value.

Just ask your neighbors who have bought since then. It adds quite the element of pathos that longtime property owners actually complain about property taxes.

>> the state's consumer price index increased by only a little more than 1.5 percent during the past year

Clearly the CPI does not accurately reflect the steep rise in rents and home costs.

>> the CA Consumer Price Index is not a cost-of-living index Web Link

It is what it is.


11 people like this
Posted by Frank
a resident of Menlo Park: Downtown
on Dec 15, 2015 at 12:16 pm

Another example of terrible reporting by the Almanac.


6 people like this
Posted by gunste
a resident of Portola Valley: Ladera
on Dec 15, 2015 at 1:53 pm

Re comment by "CPI-yi-yi-yi" : Having bought my house in 1969, I have indeed benefited from the law. But you need to be aware, that while real estate values have ballooned in this area, incomes have been far from keeping up. If my inflated value home were assessed at today's value, I would have to move, since the tax would be too much for me. Also, the last homes benefiting from the Prop 13 limits on tax increases will be sold within a few more years, and they will then be taxed at current value. Prop 13 was designed for people like me, so they would not be dispossessed in their old age due to huge increases in property tax.


16 people like this
Posted by Tunbridge Wells
a resident of Menlo Park: Allied Arts/Stanford Park
on Dec 15, 2015 at 3:04 pm

Tunbridge Wells is a registered user.


The argument that Prop 13 was designed for pensioners does not explain why it applies to commercial real estate.

Prop 13 has directly contributed to your home's inflated value, gunste, because there is certainty about future property taxes, and Prop 13 creates a disincentive for people to sell their homes and relocate for job or lifestyle changes, further decreasing the supply. Furthermore, the services that our property taxes pay for are consumed by all, regardless of income or length of ownership. What we currently have is a situation where people who got here earlier have similarly valued homes and *receive the same government services* and yet only pay a fraction of the taxes that later-arriving neighbors pay.

Prop 13 is a travesty that has gutted our educational system because a bunch of baby boomers didn't want to pay their fare share. Not a fan.


14 people like this
Posted by CPI-yi-yi-yi!
a resident of Menlo Park: Suburban Park/Lorelei Manor/Flood Park Triangle
on Dec 15, 2015 at 4:38 pm

>> Also, the last homes benefiting from the Prop 13 limits on tax increases will be sold within a few more years, and they will then be taxed at current value.

Whereas the commercial property rarely turns over, along with priveliged loopholes for commercial properties, essentially shifting the property tax burden onto the residential sector.

>> Prop 13 was designed for people like me

I disagree. My opinion?

--> Prop 13 was designed to get VOTES from homeowners; it was written and designed by commercial real estate interests for their own self interest. That much is obvious at this point.

pre-prop 13: property tax burden from commercial - 60%. From residential - 40% Today? Commercial 40%, residential 60%.

A complete flipflop from 60/40 to 40/60 and it is still headed further in that direction.

As designed, the burden of funding the state shifts from commercial interests onto homeowners. And it will get worse. We got hoodwinked into allowing the commercial loopholes that are unavailable to Gunste, his family and heirs, and all other residential property owners.

yes, Californians got screwed. Businesses made out and will continue to do so.

Yippee-yi-yi-yi-yay.


9 people like this
Posted by Stop bashing boomers
a resident of Menlo Park: other
on Dec 15, 2015 at 6:05 pm

When Prop 13 passed, the oldest boomers had barely turned 30, the youngest were 14 years old, and few owned houses. Not everything is the fault of the 70 million people who happened to be born between 1946 and 1964, most of whom are still working and contributing to the economy. You can blame the boomers for climate change, war, famine, and terrorism, but not prop 13.

"...the last homes benefiting from the Prop 13 limits on tax increases will be sold within a few more years, and they will then be taxed at current value."

Not true. All homeowners benefit from Prop 13. Housing prices have risen 25% during the last year, but people who bought in 2014 aren't seeing a 25% increase in taxes!

Commercial real estate should never have been included in Prop 13, but no one in Sacramento has the guts to change that, given that the legislators' biggest contributors often own commercial real estate.


2 people like this
Posted by jbcham
a resident of Atherton: West Atherton
on Dec 15, 2015 at 9:36 pm

Has any one done a study to see how much property tax revenues have increased in California since the passage of Prop 13? I would imagine with the huge increases in property values in our area property tax revenues have risen many times inflation.
There was once a study that found the average Californian sells their home every seven years and buys another and the new property taxes reflect the new purchase price. That has been our experience since we bought our first home in 1976. Thus our property was in effect reassessed every seven years until we bought our final home in 1988 which we totally remodeled in 1996.


Like this comment
Posted by Roy Thiele-Sardina
a resident of Menlo Park: Central Menlo Park
on Dec 16, 2015 at 8:19 am

Commercial real estate does NOT use loopholes. what they do is have an LLC for ownership and transfer that LLC to another party. You are welcome to do the same thing......most people choose not to.

Roy


2 people like this
Posted by Jack Hickey
a resident of Woodside: Emerald Hills
on Dec 16, 2015 at 10:39 am

Jack Hickey is a registered user.

From 1978 to 2014, assessed value of the secured role in the county increased by a factor of 11.86. During that time, population grew by a factor of 1.29. Inflation adds a factor of 3.63.
Adjusted for population and inflation, assessed value grew by a factor of 2.5.

Property taxes should be cut at least in half.


Like this comment
Posted by Franc
a resident of another community
on Dec 16, 2015 at 5:15 pm

Just got my Social Security annual update..."We review Social Security benefits each year to make sure they keep up with the cost of living.The law does not permit an increase in benefits where there is no increase in the cost of living. So your benefit will stay the same for 2016"....Well there you are...Mr. Church.


Like this comment
Posted by Ugh
a resident of another community
on Dec 17, 2015 at 1:02 pm

Interest rates rising as well.


10 people like this
Posted by Samuel S
a resident of Menlo Park: Sharon Heights
on Dec 17, 2015 at 4:12 pm

See above post

"cost of living" and CPI are different.

Funny how Jack has no rrsponse to the move from 40/60 to 60/40.


Sorry, but further commenting on this topic has been closed.

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