What you need to know about the property tax appeal deadline NEXT week in Sacramento

I’m not trying to be THAT guy by starting a business conversation during Thanksgiving, but this is important. Did you know the deadline to appeal property taxes in Sacramento County is on Monday? Since December 2, 2013 is the cutoff point, I’ve boiled down the process to three steps of what you need to know. Please pass this along to friends and clients.


Three Steps for Disputing Property Taxes in Sacramento County:

  1. Look up your assessed value here: Your assessed value listed at this link is supposed to be what your home was worth on January 1, 2013 (NOT today’s value). Does the value seem reasonable? If yes, don’t do anything. If not, go to Step 2. Keep in mind every $10,000 of assessment ends up costing you about $125 out of your pocket. This means if you are overassessed by $50,000, you’ll be overpaying about $625 this year in property taxes. This is good to consider so you can determine if it is worth your time and effort to move forward.
  2. Request a free informal review by the Assessor here: You can ask the Assessor to take a look at your assessed value for free. This is not an appeal, but only an informal review (also known as a “Prop 8 Decline in Value” form). If the Assessor responds to you at some point, great. But if they don’t agree with your opinion of value after the deadline to appeal has passed (even if you are right), you’re out luck since you didn’t formally appeal (Step 3). This step is better than nothing (and it’s free), but Step 3 is best.
  3. Image purchased at 123rf dot com and used with permission - 14688774_s - smallerFile a formal appeal: All you need to do is fill out the Application for Changed Assessment (PDF) (cost is $30) and turn it in before the deadline. Along with the application it’s best to provide some support for what your property was worth on January 1, 2013. Ideally you should provide a list of comparable sales around January 1, 2013 (NOT current sales) and write up a few sentences about how these sales compare to your property. Let’s be honest though, it is a busy week ahead, so if you don’t have time or ability to gather support in these next few days, just fill out the application anyway. The most important thing this late in the game is to get the application in. You can always provide support later (or hire someone like me to help you with that in the future if the Assessor sends you a letter about an appeals hearing). The main benefit of a formal appeal is that it entitles you to carry on the conversation with the Assessor if they disagree with your opinion of value. You do not have the right or power to keep the appeals conversation going when you only do Step 2.

Please let me know if you have any questions. I really understand how this process works, so I’ll be glad to answer any last-minute questions you might have.

Have a wonderful Thanksgiving. I hope it’s your best one ever.

Pro Tip: Don’t talk about property taxes at the Thanksgiving table.¬† ūüôā

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Gavin Maloof sold his house in Natomas

The Maloof family is still making headlines in Sacramento. I read in last week’s Sacramento Business Journal that Gavin Maloof, one of the former owners of the Sacramento Kings, recently sold his property in the Westlake neighborhood of Natomas for $1,112,500. I wanted to give some further market context to the sale, which I thought would be interesting to locals.

Westlake Maloof House in Sacramento - by Sacramento Appraisal Blog

Measuring by Pro Sports Standards: The Maloof property is definitely on the larger side. It comes in at 5203 square feet according to public records, which is a bit larger than an NBA basketball court at 4700 square feet (94′ x 50′). Technically if this home was measured in basketball courts it would be 1.10 courts. By the way, it sounds better to use basketball court figures for measurement since this house would be 110% of a basketball court, but only 9% of an NFL field or 64% of an MLB baseball diamond.

Westlake Natomas Sales History - by Sacramento Appraisal Blog

Neighborhood Market Trends: As you can see, the Maloof property sold quite a bit above others in the neighborhood. However, there are definitely a few things to keep in mind. First of all, this graph only includes properties that sold on MLS, which means private transactions and sales directly from the builder are excluded. For instance, the Maloof home was purchased originally in 2002 directly from JTS for $1,008,000. Obviously it was one of the premium homes at the time since it sold far above others. Secondly, property values are easily somewhere in the 2002 range right now in this neighborhood and in most areas of Sacramento (sometimes we see 2003 levels, but most areas are still hovering somewhere around 2002 levels). I am not saying this house sold at market value for its most recent sale, but only that buyers have been willing to pay 2002-ish levels for many houses in Sacramento. Ultimately I’m not terribly surprised to see a higher sale for a custom home in The Shores at Westlake.

In case you are not aware, the Westlake neighborhood is located literally 2.5 miles from the arena. There are definitely multi-million dollar properties in the surrounding Sacramento area, where some of the other Kings players live (and I imagine a Maloof could have afforded), but nothing in a gated community as close to the arena as this neighborhood.

Property Tax History for Gavin Maloof Sacramento Home - by Sacramento Appraisal Blog

Property Taxes for the Maloof Home: What do you notice about the property tax history for the Maloof home in Natomas? Interestingly enough, it looks like property taxes saw an increase through 2008 despite the market showing a clear decline – especially from 2006 to 2008. Also, you may have heard property taxes can only increase by 2% each year, so why were there increases far above that level on this house? Here is how it works. The Assessor can only inflate taxes by basically 2% each year under normal circumstances, but for property owners who had previously received a reduction in assessed value under Proposition 8 (this is the tax Prop 8 – not the marriage Prop 8), their property taxes can be raised any amount each year so long as it is not increased above the original ‚Äúbase-year value‚ÄĚ (also called the ‚ÄúProp 13 value‚ÄĚ ‚Äď which is usually the original purchase price from years ago). Does that make sense?

By the way, these figures are all a matter of public record. Check out Zillow to get the past 9 years of taxation or the Assessor’s website for the past 2 years. If it’s relevant, you can read more here about how property taxes work in Sacramento.

I hope this was as interesting. Any questions, thoughts or insight?

Question: Would you pay a premium to own a house previously owned by a celebrity?

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How long does it take to appeal property taxes in Sacramento County?

When will you hear back from the Assessor? It could be a matter of months, but ultimately it can take up to two years.¬†The County of Sacramento states “The time limit for the Assessment Appeals Board to act on an application is two years from the date of filing.” In my experience it seems¬†The Appeals Board typically¬†gets back to owners within a year, but sometimes longer and others times only a matter of months.

property taxes Sacramento CountyDo you still have to pay your property tax bill at the higher level during an appeal? Unfortunately yes. This is often frustrating for home owners, but it’s the way the system works. Verbatim from the Assessor’s Office, “You must pay the original bill timely to avoid penalties, pending the outcome of the review or appeal.”¬†Keep in mind Sacramento County will issue you a refund from your overpayment if your property taxes get lowered through the appeals process.

How long does it take Sacramento County to issue a refund after a successful appeal? Your refund should come within 95 business days.¬†Don’t expect to be the exception either. You’ll get between $100-125 back for every $10,000 in property reduction. If you were overassessed by $50,000, for example, you would get $500-625 back in your pockets. From the Assessor’s website:

All offices involved in the property tax process (Assessor, Auditor-Controller and Tax Collector) are experiencing a historically large volume of these reductions. When the Assessor’s Office determines a reduction in assessed value is appropriate, a roll change is processed and certified to the Auditor-Controller, typically within 15 business days. The Auditor-Controller will issue a corrected tax bill within 20 business days and deliver it to the Tax Collector for further processing. If a refund of paid money from the original bill is required, it is normally issued within 60 business days after the corrected tax bill has been calculated. You should anticipate the assessment changes will take up to the full 95 business days to be processed.

Is it still worth it to appeal despite having to wait? You have to answer that question for yourself. I think if there is money to save, it’s absolutely worth it in my opinion, and the appeals process is the only way to obtain a reduced value (unless the Assessor reduces your property value automatically due to their own research). It may be frustrating to wait, but the alternative is to overpay taxes. I have successfully appealed my¬†property’s taxes three times and I always enjoy getting a refund to check to keep my hard-earned money in my pocket. If I have to wait a while to get money returned to me, I can live with it.

I hope this was helpful. Let me know if you have any questions, check out other articles on property taxes and visit my property tax appeal website for additional information.

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Some things to keep in mind about property taxes in the Sacramento area

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.