Reassessing a Home's Value

[Noah930]

November 30th is the deadline here in Los Angeles to place a request to have your home value reassessed for tax purposes. Is there a limit to the number of times or frequency with which this can be done? In a declining market, why wouldn't an owner do this annually?

Our house has dropped maybe around 5% in value since we purchased it a couple years ago. The savings on tax might not be huge, but it would be worth a couple hundred dollars, at least.

Is there a downside I don't appreciate? Would it make it any more difficult to refinance a mortgage? Regardless of what the county says our house is worth, wouldn't the mortgage lender do their own appraisal in that situation?

[PorscheGAL]

The mortgage company will do their own appraisal. It does not matter what the county or city values your home at.

[skunked]

Originally Posted by PorscheGAL

The mortgage company will do their own appraisal. It does not matter what the county or city values your home at.

not in CA

Los Angeles County Assessor's Office - Property Owner's Guide to Proposition 8

[krystar]

but mortgage companies go of "market value" of the property, not tax value.

[red-beard]

Houses are re-assessed here every year. You can directly protest your change. You can also hire someone to do this for you, and most charge 1/2 of the difference.

[Zeke]

I don't think anyone understands CA real estate taxes. So far, no one here does.

We still have Prop 13. When a home is purchased, the tax rate is based on the purchase. It can only go up a small percentage each year after that regardless of how much the value of the property increases which has been a lot for much of my adult life. Some years saw 20 % increases. Lately, some years have seen 20% decreases.

Anyone who purchased a home 5 to 5 years ago in most of CA still are valued at or lower than current prices. (this does vary quite a bit by region) You would not want to reassess if this is the case. Those that purchased 2-3 years ago will benefit from a reassessment and you can do this annually with no penalty.

Now, if they vote to overturn Prop 13, the state can reinstate your higher taxes as fast as you decreased them. And for long time homeowners, if even the current values were used as the basis, many people would see anywhere from double to an increase as much as ten fold.

While that would certainly help solve the budget, it would tank what fragile economy we have. And it would in a bassackwards way throw the real estate market into a tailspin that you couldn't imagine. There would be 10 houses for sale for every buyer.

Mass exodus and I would be at the head of the line leaving.

[Noah930]

Originally Posted by Zeke

Those that purchased 2-3 years ago will benefit from a reassessment and you can do this annually with no penalty.

Thanks.