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Learn about real property assessments
Proposition 13, California's property assessment law that impacts property taxes.
Proposition 13
How Proposition 13 (voter approved in 1978) affects your property taxes
- Defines when reassessments occur
- Generally, your property is reassessed to current market value only upon a change in ownership or completion of new construction (called the base year value).
- Limits the annual assessment increases to no more than 2%
- Generally, your property's assessment, the basis of property tax, will not increase by more than inflation or 2% per year, whichever is lower. Inflation is set by the California Consumer Price Index.
- Please note: If you received a prior year temporary decline-in-value, the subsequent year's assessment can increase more than 2% as long as the assessed value does not exceed the factored base year assessed value.
- Generally, your property's assessment, the basis of property tax, will not increase by more than inflation or 2% per year, whichever is lower. Inflation is set by the California Consumer Price Index.
- Limits the property tax rate
- The assessed value is multiplied by the appropriate tax rate to form the basis of the current year's tax bill. The tax rate is 1 percent plus any voter-approved bond indebtedness and direct assessments.
When reassessment occurs
- When your property changes hands or you build something new, its value is updated to match current market values. This becomes the new "base year value".
- Every year, this base year value is adjusted to no more than 2% or the inflation factor, whichever is lower. This adjusted value is the "factored base year value.
Assessing your property
The duties of the county assessor are to discover all assessable property, to inventory and list all taxable property, to value the property and to enroll the property on the local assessment roll. One of the primary responsibilities is to annually determine the proper taxable value for each property.
Under the California Constitution, all property is taxable. Property is defined as all matters and things - real, personal, and mixed - that a private party can own.
In estimating a property's fair market value, Assessors use various valuation methods. The three major appraisal approaches are the following:
- Comparative sales approach
- Cost approach
- Income approach
The Comparative Sales Approach
- We estimate your home's value by looking at what similar houses nearby have recently sold for in the same or similar neighborhood.
- In selecting comparable sales, state law requires sales to be sufficiently near in time, and the properties must be similar in size, quality, age, condition, utility, amenities, site location, legally permitted use, or other physical attributes to the subject property.
- When several sales are confirmed and analyzed, they are considered good indicators of a similar property's value.
The Cost Approach
- This approach focuses on the total cost to replace the property. Our office considers current costs of labor, materials and indirect costs such as architectural fees, land development costs, construction financing and depreciation.
The Income Approach
- This method works for buildings that generate income, like apartments, hotels or offices. In addition to the expected rental income or financial return for the property, our office considers how much it costs to run them, taxes, insurance, maintenance costs and how risky they might be to own. This approach helps estimate the property's value based on its income potential.
Fact sheets about valuing your property
For more information: Fact Sheet: Basics of valuing your property, 中文, Español, Tagalog, Tiếng Việt, Pусский, 한국어
Watch a video about Prop 13.