Category — Property Taxes

Many home owners wonder what they need to do to appeal their property taxes. Sacramento Realtor Doug Reynolds interviewed me the other day on this very topic, and I touched on some foundational issues such as the date of assessment, filing the correct form, comparable sales and when it makes sense for a home owner to appeal. Thank you so much Doug for the interview. Catch up with Doug at 916-494-8441 and www.buywithdoug.com. Keep me posted if you have any questions.

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Something must be fishy if your model match neighbor is paying less in property taxes than you, right? Not necessarily. Is this a point you should bring up during a property tax appeal? It’s really not a strong point because your neighbor Joe could have purchased at a different time than you, and the difference in sales price will result in a difference in taxes paid each year. All things considered, if Joe purchased in 2002 at $247,000 and you bought an identical home in 2008 for $505,000, Joe is going to be paying about half as much in taxes than you do because of Proposition 13 in California. Assuming you purchased your home at a fair market value, your purchase price will most likely be the “Proposition 13″ value (also called the “base year value”). This means subsequent years of taxation will be based upon that value level – $505,000. If the market declines, then the assessor may issue a temporary decline in value under “Proposition 8″ (the real estate prop – not the marriage one), but that still does not take away the original $505,000 Proposition 13 base year value. If the market improves over time, your property taxes can still return to that level. That’s not going to happen for quite some time though in the Sacramento area.

Good or bad advice? I sometimes hear advice from real estate professionals for home owners to make a list of what neighbors pay in taxes, but this isn’t good advice to follow for reasons listed above. The Assessor even states on their website that “only open market sales that occurred before March 31, 2011, can be used to review your 2011-12 value” (not your neighbors taxes). While it may seem to be a secondary form of value support in certain cases, the best thing you can do is provide solid comparable sales between January 1 – March 31 of the given year. Or even provide sales between September to December of the previous year in addition to January to March. Hard facts such as sales from the market are worth way more than saying “but Joe next door pays less than me and I should pay less too”.

If you have any questions or you need help with the tax appeals process in Sacramento County or a surrounding area, let me know. I run a property tax appeal company and I’m always happy to help answer questions.

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Don’t just tell me, show me. In all my tax appeals and appraisals, I like to visually display what is happening in the market. It helps get a point across and sometimes shows a certain trend too. In the case below, a home owner in the Hillcrest neighborhood in Folsom contacted me about disputing his property taxes. As you can see, the Sacramento County Assessor’s Office had his property assessed around $940,000. When looking at the graph though, does something seem suspect? Being that there were zero sales above $900,000 over the past 2+ years in the entire City of Folsom, there are some red flags. Granted, there could definitely be a reason why a property is valued as a “lone ranger” (especially in Hillcrest), but in this case after my valuation was complete, true value was $140,000 less than assessed value (that’s about $1,750 in property taxes).

What do you think of the graph? What trends have you seen in Folsom lately?

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

It’s always nice to get unexpected money in the mail, right? Sacramento County recently cut me a check for the third consecutive year after I disputed my property taxes. The grand total this year is not substantial like it has been for some of my clients, but I’ll take a check for $310.41 any day of the week. Over the past three years I’ve had a tax refund total of $1,158.39. Not too shabby considering I would’ve never seen this money had I not appealed.

How should I spend the refund? A few HP Touchpads? Or maybe that bill from an ER trip after my son’s bike accident?

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook or subscribe to posts by email.

When appealing your property taxes and you get a form that looks something like the one below, should you sign it? Let me walk you through the decision process.

First off, the official form to fill out to contest your property taxes is called the “Application for Changed Assessment” (not the “Decline in Value” Prop 8 form). This application must be completed by November 30 in many counties surrounding Sacramento (or September 15 in Placer County). After you fill this out, the appeals board will eventually do one of three things: 1) Agree with your opinion of value and ask you to therefore withdraw your appeal; 2) Ask you to agree with a new value they pick and therefore withdraw your appeal; or 3) Set up an appeals hearing to discuss your situation further.

If the Assessor does #1 or #2 above, you’ll get a form that looks something like this.

Should you sign this form? Here is what I tell my clients as well as home owners who contact me. If the Assessor’s new value is pretty close to your listed value (or mine if we worked together), then it probably makes good sense to sign this form. Some home owners get scared of signing something like this, but all you are doing is saying you agree with the Assessor’s new value offer and you will no longer pursue an appeal. For example, the Assessor said the property above was worth $211,758, but after my appeal they offered a new value at $150,000. By signing the document, the new assessed value became $150,000.

Accept or Fight? Keep in mind that every $10,000 in assessed value equals about $125, so if the offered value is fairly close to yours, then it probably isn’t worth the time and energy to contest it any further. Just accept the value and move on. However, if the value is off by multiple tens of thousands or a couple hundred thousand dollars still, then it may be worth staying in the fight by going through with the appeals hearing. Just make sure you have a convincing case. If I did your appeal, I can give you advice about this when the time comes (or if you hired me to represent you at the hearing anyway, don’t even worry about this because I have it under control). Even if you didn’t hire me, give me a call and I’ll help where I can.

Do you have any questions? I hope this was helpful.

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook or subscribe to posts by email.

I wanted to give you some tips and important dates for appealing your property taxes if you are considering doing that in a county surrounding Sacramento.

1. Value Date for 2011:  Your property tax assessment for 2011 should be based on January 1, 2011.
2. The Assessor’s Word:  Check to see what the Assessor says your property is worth for 2011. It only makes sense to dispute your property taxes if there is a savings to be had (see links below). Every $10,000 of over-assessment equals about $125 out of your pocket.
3. Deadlines:  Know the deadlines for your local county. In most counties surrounding Sacramento you can appeal your property taxes between July 2 to November 30, but Placer County has a deadline at September 15, 2011.
4. Costs:  Many counties have a cost to file a formal appeal anywhere from $30-45, while some counties are still free. We often hear how there is no fee to contest property taxes, but that’s just not the case in many counties.
5. The Right Application:  Make sure you fill out the “Application for Changed Assessment” form. The Assessor has a “Prop 8 Decline in Value Form” you can try first for free, but this form is NOT an appeal. If you do not file the proper form before the appeals deadline, you have not officially appealed your property taxes (and you cannot fill out the form after November 30). I speak with many home owners every year who failed to file the right form.
6. Support Your Value:  Provide support for your opinion of value. Don’t lowball the Assessor or simply throw out a preferrable number for your property taxes. Show evidence for what your property was worth on January 1 of the given year. Do not use current comps, but rather sales from January 1 to March 31 if possible. If you need help doing this, please contact me since I run a property tax appeal company and I can give solid support for your property’s value at a very reasonable cost (usually around $100). I find most cases do not warrant a full appraisal, but rather a mini-report.

Check your assessed value for 2011 by clicking on the following links. You may need to enter your APN (assessor parcel number), and you should be able to quickly retrieve that on the Assessor’s website. If not, call me and I’ll get it for you.

• Sacramento County Assessor’s Website
• Placer County Assessor’s Website
• Yolo County Assessor’s Website
• El Dorado County Assessor’s Website
• San Joaquin County Assessor’s Website
• Solano County Assessor’s Website

I hope this was helpful to begin to lay a general framework for important property tax details. If you have any questions about the tax appeal process or would like my tax appeal company to look up your property for free, please click here.

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook or subscribe to posts by email.

If you think your property tax bill is high in Sacramento County, take a look at the amount paid out each year by Maloof Sports & Entertainment for Power Balance Pavillion (formerly Arco Arena). More than just the numbers, what do you make up such a steep decline in property taxes over the past year? How does that impact the City of Sacramento?

There are actually five separate parcels for the arena in Natomas, but the above graph only considers 1 Sports Pkwy since it is the largest and most heavily taxed parcel (it’s the parcel that includes the arena). The other four parcels really only added up to just over $430,000 in assessed value for 2010, which is about $6,500 in property taxes.

Breakdown of assessed value and property taxes for 1 Sports Parkway
2011 assessed value: $29,129,000 ($450,000 in property taxes – estimate)
2010 assessed value: $56,534,445 ($881,208 in property taxes)
2009 assessed value: $58,844,792 ($904,003 in property taxes)
2008 assessed value: $59,595,796 ($940,690.94 in property taxes)

It might seem surprising to see such a low assessed value for an entire arena, but keep in mind the original stadium was constructed for about $40 million in 1987 (Wikipedia states today’s costs would be $74.3 million).

What do you think of the numbers above? How much of a role does the arena play in the health of our local economy?

FYI: Property taxes for 2011 were posted yesterday by the Sacramento County Assessor. I strongly recommend all property owners to look over their assessed value closely (click this link) to make sure you are paying your fair share of taxes – and no more. If you have any questions about the tax appeal process or would like my tax appeal company to look up your property for free, please click here.

The ”Parkview Condos” were converted from apartments in 2005, and I thought it would be interesting to sneak a peek into the history of the development. These units located at 7032 Fair Oaks Blvd in Carmichael went on sale near near the very top of the market and have basically taken a pretty steep decline downward since (this is common to the Sacramento area since August 2005 of course).

Some key points about the Parkview Condos:

• There are 43 units in the Parkview Condos
• The size of some units are recorded incorrectly. The 1046 model is actually closer to 950 square feet. This could make a difference in market value and a tax assessment, don’t you think?
• This complex is NOT on the FHA approved condominium project list
• As of this week, the HOA says 40% of the units have an off-site address (this often means these units are rentals)
• All sales and listings this year appear to be overassessed between $138,000 to $165,000 despite sales between $60,000 to $80,000.
• There is a townhouse subdivision next door called “Parkview Townhomes”. There is a big difference between a condominium and townhouse, so sales in these two neighboring subdivisions really shouldn’t be compared. However, it’s nice to juxtapose each complex because the sales may still influence the immediate market (I just won’t use townhouse sales in a condo appraisal report though, for example).

Is there anything you’d be cautious of when purchasing a property like this? What other apartment complexes in the Sacramento area have you seen get converted?

If you have any real estate appraisal, consulting, or property tax appeal needs in the Greater Sacramento Region, contact me at 916.595.3735, by email, on our appraiser website or via Facebook. 

Why is there sometimes a huge difference between what the Assessor says a property is worth and what an appraiser says? I’ve included five points below to help answer this question.   

Base year value: Assessments in California are based on the year the property was purchased (“base year value”). If a property was purchased in recent years, the assessment might be similar to current market value, but if a property was bought in 1980, for example, the assessment could be significantly less than what the property is currently worth since property taxes are only allowed to increase by 2% annually according to Proposition 13. 

Mass-appraisal process: The Assessor’s Office uses a mass-appraisal process that comes up with a value based on crunching numbers behind a desk. This process is not able to account for condition, quality of construction or other issues an appraiser is able to see in person.

Assessments may be outdated: When the market changes rapidly, the Assessor’s Office may or may not stay on top of market movement in all cases. For example, in the past two weeks I’ve done research for several Sacramento property owners and their assessed values were literally hundreds of thousands of dollars too high. 

Assessment figures are based on January 1: Property tax assessments are based on January 1 of the given year (date of assessment), whereas an appraisal could be based on any date.   

An assessment is not market value: Assessment figures are not the result of the interaction of buyers and sellers in an open market, so they cannot be considered to demonstrate “market value”. This is one reason why appraisers do not use the assessed value on a property as a ”comparable” in an appraisal report. Read Fannie Mae’s definition of market value here. 

All things considered, can you see why there might be a difference between assessed value and appraised value? This is exactly why appraisers don’t give weight to tax assessments during the appraisal process and why lenders do not lend on tax assessment figures. Let me know if you have any questions or insight.

If you have any real estate appraisal, consulting, or property tax appeal needs in the Greater Sacramento Region, contact me at 916.595.3735, by email, on our appraiser website or via Facebook. 

I call this time of year “property tax season” because conversations with home owners start to really heat up now that April 15th has passed and most local Assessors will soon publish their 2011 property tax figures. Ever year around this time I get a great deal of calls about reducing property taxes in the Sacramento area. Let me share with you three of the tax situations I encountered last week:

Owner of vacant parcel: I just spoke with an owner of a vacant parcel in Sacramento, and his land is easily overassessed by $250,000. Vacant land is often assessed high for investors who purchased in recent years since land values have plummeted since the cost to build often currently exceeds resale value. 

Paying twice as much: In the past two days I spoke with a home owner who is paying more than twice as much in property taxes as he should be. His house is worth less than $200,000, but it is assessed at $400,000. Keep in mind that every $10,000 in assessment equals about $125, so this owner is essentially overpaying by $2,500 per year.

My own property taxes: The Assessor agreed to reduce the assessment on my own property by $27,000 for my 2010 property taxes. They ended up agreeing with my appeal last year, so on Friday I faxed back a “tax withdrawal” form to say I’ll accept the new value. This is not a huge savings, but I don’t mind getting a refund of $330 or so. I’ve been successful at appealing my own taxes for three consecutive years.

How do you know if you should appeal your property taxes? First of all, please do not pay anyone to appeal your property taxes until you know how much your property is assessed for 2011 and also if it really makes sense for your wallet. As an FYI, 2011 assessments will be announced anytime between May through July for most counties surrounding Sacramento. I made the video below last year and I think it may help provide a good context for understanding whether you should appeal or not. You may also wish to read some FAQs on my property tax appeal website. Note my fee is now $99 instead of $89 for a typical house – not vacant land or anything complex. There are so many companies ripping people off too, so I also included a second video, “Two reasons to be careful of those ‘lower your property taxes’ mailers“, to help illustrate what types of companies to avoid. I know a video like this sounds like I’m saying “work with me – not them”, but it’s really not self-serving at all. This is about helping locals understand the tax appeal process so property owners are equipped to make a well-informed decision.   

Email Sign-Up: I am glad to keep you in the loop about important property tax appeal deadlines and general information for counties in the Greater Sacramento Region. There is no obligation to do business with me and I’ll only email you once per quarter. Click here to get email reminders about important property tax information and deadlines (only 4 emails per year). Call or email me if you have any questions.

If you have any real estate appraisal, consulting, or property tax appeal needs in the Greater Sacramento Region, contact me at 916.595.3735, by email, on our appraiser website or via Facebook.

Have you received one of those mailers from a company promising to reduce your property taxes? I’m not saying at all there is some sort of ethical problem with these companies, but home owners in the Sacramento Region would be very wise to not hire companies like this to dispute their property taxes in the early part of the year. I made a brief video PSA to explain why (or watch HERE).

I know a video like this sounds really self-serving at face value, but it’s not, and here is my logic why. In the first quarter of the year when these mailers typically get sent out, the Assessor’s Office has not yet published their yearly assessed values. In my mind, why pay someone to reduce your property taxes before you know if the Assessor is going to automatically reduce them? The Assessor is supposed to adjust assessed values up or down depending on what the real estate market has done in the previous year. Secondly, the formal time period to disupte taxes in most counties surrounding Sacramento is July through November (or September for Placer County) – not the first quarter of the year.

What do you think?

If you have any questions about the tax appeal process or you’d like to sign up on my property tax email list to let you know about important tax appeal dates and deadlines for the Greater Sacramento Region, comment below, send me an email, fill out this form on my tax appeal website, or call 916.595.3735.

I got some great news recently that the Assessor’s Office in Sacramento County agreed to lower property taxes by roughly 1.5 million on some acreage that one of my clients owns. The detailed appeal I put together for his 2009 property taxes revealed a total value of $340,000, but the Assessor had this parcel assessed at $1,804,053 (just a little bit of a difference, right?). I’m so glad the Assessor agreed with my research. The tax savings for my client is almost $20,000 for the year. 

NOTE: In case you were wondering, there was previously a tear-down structure on the property valued at $53,060 by the Assessor. This structure was removed a couple years ago, so that’s why there is currently no value for it.  

If you have any questions or a need for an appraisal or property tax consulting in the Sacramento area, give me a call at 916.595.3735, send me an email, or catch me on Facebook.