As were seeing decline in real estate values, Proposition 8 helps Pasadena homeowners save on real estate property taxes.
What is Proposition 8?
In 1978, California voters passed Proposition 8, a constitutional amendment that allows a temporary reduction in assessed value when a property suffers a ˜decline-in-value. A decline-in-value occurs when the current market value of your property is less than the current assessed value as of January 1.
How do you become eligible?
- You must demonstrate that on January 1, the market value of your home was less than its current assessed value. Ask your Pasadena Real Estate Agent to provide you with 2 comparable sales as close to January 1 as possible that will demonstrate the decline in the value of your home.
- You must file a claim for for a Decline-in-Value Reassessment Application (Prop 8) with the Assessor between January 1 and December 31 for the fiscal year beginning on July 1.
- All real property qualifies for reassessment - not just single family residences.
- A comparable sale is considered a property sold with features that are similar to your property. A property similar in location, zoning, size, number of bedrooms and bathrooms, age, quality and condition that is sold in the open market.
- A good place to find comparable sales information is to ask your Real Estate agent.
- Assessors website is www.assessor.lacounty.gov
UPDATE: One of my clients, Jim Bone wanted to share some additional points on Proposition 8. Jim was on the Orange County property tax Assessment Appeals Board for 13 years and his specialty is California Property Tax. A huge big thank you to Jim for the below update!
? Good data is critical in getting your reassessment request approved. The law limits comparable sales to transactions that closed no more than 90 days after the lien date. Make sure that the comparable sales are not past March 31st!
? The Assessor Form RP-87 provides easy to understand instructions and can be found by following this link - http://assessor.lacounty.gov/extranet/guides/prop8.aspx
? If the homeowners file the requests by completing the above form within the next couple of months, its possible the Assessor will enroll the lower value the first time. If the homeowner waits until later, then the Assessor will issue a higher assessment, the homeowner will have to pay the higher taxes, and wait to get a reduction in their second half bill (assuming you get a reduction - request approved).
? The Assessor recommends that all homeowners that have not received reductions by October 1st file assessment appeals to protect their rights. Assessment appeals must be filed no later than November 30th, or 60 days from the receipt of a Notice of Supplemental Assessment for recent acquisitions.
? Homeowners will not know what the assessed value of their home is for 2008 until they receive their tax bills in October, or a response to a Prop. 8 review request. If youve owned the house a year, you can estimate the new value at 2% more than the 2007 value.
And - most importantly if you need to appeal the assessment decision, you must do so by November 30th.
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Thinking of selling your home? Interested in finding out the current market value of your single family home, condo or investment property? Then call Irina Netchaev at (626) 629-8439 to discuss what is happening in today’s Southern California Real Estate Market.