Assessor gone mad?

[Chance the Gardener]

The county assessor’s office determined the base year assessment of my condo to be $100K more than I paid for it. I purchased the condo earlier this year in an arms length transaction from a bank. While the property was bank-owned, it was listed on the MLS and the bank was represented by an agent. Isn’t the purchase price in an arms length transaction presumed to be the fair market value and thus the “acquisition” price? Isn’t the burden of proof on the assessor to show that the purchase price is not the fair market value? Has anyone fought a similar battle? I filed for an appeal within the specified time and I am waiting for my hearing.

I am interested in hearing from anyone who has particular experience with base-year assessments which deviated from purchase price… and anyone who has appealed an assessment before the appeal board and has advice about that forum.

[Bugs]

An “arm’s length transaction” is not synonymous with “market value”, especially when a seller is compelled to sell no matter what.

Still, the assessment may not be correct, either. If the dataset used to come up with that value includes dated sales data then the assessment might be overstated.

You would need to come up with some sales data showing that the price you paid was typical and that you didn’t get a great bargain.

[Chance the Gardener]

Assessor’s burden:

Bugs, I agree, but isn’t it the assessor’s burden to show that the purchase price is not the full cash value? I rely on section 110 of the California Revenue and Taxation code:

“(b) For purposes of determining the “full cash value” or “fair market value” of real property… being appraised upon a purchase, “full cash value” or “fair market value” is the purchase price paid in the transaction unless it is established by a preponderance of the evidence that the real property would not have transferred for that purchase price in an open market transaction. The purchase price shall, however, be rebuttably presumed to be the “full cash value” or “fair market value” if the terms of the transaction were negotiated at arms length between a knowledgeable transferor and transferee neither of which could take advantage of the exigencies of the other…“

[Chance the Gardener]

Assessor’s burden:

Bugs, I agree, but isn’t it the assessor’s burden to show that the purchase price is not the full cash value? I rely on section 110 of the California Revenue and Taxation code:

“(b) For purposes of determining the “full cash value” or “fair market value” of real property… being appraised upon a purchase, “full cash value” or “fair market value” is the purchase price paid in the transaction unless it is established by a preponderance of the evidence that the real property would not have transferred for that purchase price in an open market transaction. The purchase price shall, however, be rebuttably presumed to be the “full cash value” or “fair market value” if the terms of the transaction were negotiated at arms length between a knowledgeable transferor and transferee neither of which could take advantage of the exigencies of the other…“

[Chance the Gardener]

Assessor’s burden:

Bugs, I agree, but isn’t it the assessor’s burden to show that the purchase price is not the full cash value? I rely on section 110 of the California Revenue and Taxation code:

“(b) For purposes of determining the “full cash value” or “fair market value” of real property… being appraised upon a purchase, “full cash value” or “fair market value” is the purchase price paid in the transaction unless it is established by a preponderance of the evidence that the real property would not have transferred for that purchase price in an open market transaction. The purchase price shall, however, be rebuttably presumed to be the “full cash value” or “fair market value” if the terms of the transaction were negotiated at arms length between a knowledgeable transferor and transferee neither of which could take advantage of the exigencies of the other…“

[Bugs]

An “arm’s length transaction” is not synonymous with “market value”, especially when a seller is compelled to sell no matter what.

Still, the assessment may not be correct, either. If the dataset used to come up with that value includes dated sales data then the assessment might be overstated.

You would need to come up with some sales data showing that the price you paid was typical and that you didn’t get a great bargain.

[Bugs]

An “arm’s length transaction” is not synonymous with “market value”, especially when a seller is compelled to sell no matter what.

Still, the assessment may not be correct, either. If the dataset used to come up with that value includes dated sales data then the assessment might be overstated.

You would need to come up with some sales data showing that the price you paid was typical and that you didn’t get a great bargain.

[bubba99]

Prop 13 states:

“The maximum amount of any ad valorem tax on real property shall not exceed One percent (1%) of the full cash value of such property. ”

Until now the assessors have been using the last sale value as “cash value”. It will be difficult for them to claim the sale does not constitute actual cash value.

[betting on fall]

Doesn’t the first property tax bill often still reflect the old assessment on a property?

I know when I bought some years back, we got a very small property tax bill based on the old owners base, then get a large supplemental bill.

You may be getting a bill based on the old assessment since they haven’t put your new purchase price into the system yet.

[djrobsd]

This could be interesting. I wonder what happens if the supplimental tax bill is NEGATIVE… Do they send you a check? This could be the first one in ages.

[djrobsd]

This could be interesting. I wonder what happens if the supplimental tax bill is NEGATIVE… Do they send you a check? This could be the first one in ages.

[djrobsd]

This could be interesting. I wonder what happens if the supplimental tax bill is NEGATIVE… Do they send you a check? This could be the first one in ages.

[Chance the Gardener]

I definitely have been assessed $100K more than the purchase price. I received a supplemental assessment and talked to the appraiser to confirm that the assessment was not a clerical error. For purposes here, lets assume I paid $500,000 and the assessment was for $600,000. The previous owner’s assessment was $650,000.

You are right, however, that my current tax bill is based on the prior owner’s assessed value. That is not what I am worried about, as I know that if I pay based on the $650K assessment that I will get a refund on the next supplemental roll.

When I spoke with the assessor’s appraiser, he told me that he looked into comparable sales in my building because I had gotten such a good deal and because I purchased the property out of foreclosure. I did not purchase the property out of foreclosure, I purchased the property from a bank who purchased the property from another bank who bought the property at auction. The property was listed on the MLS in excess of 30 days when I made my offer at asking. I was represented by an agent, and so was the bank.

[Chance the Gardener]

I definitely have been assessed $100K more than the purchase price. I received a supplemental assessment and talked to the appraiser to confirm that the assessment was not a clerical error. For purposes here, lets assume I paid $500,000 and the assessment was for $600,000. The previous owner’s assessment was $650,000.

You are right, however, that my current tax bill is based on the prior owner’s assessed value. That is not what I am worried about, as I know that if I pay based on the $650K assessment that I will get a refund on the next supplemental roll.

When I spoke with the assessor’s appraiser, he told me that he looked into comparable sales in my building because I had gotten such a good deal and because I purchased the property out of foreclosure. I did not purchase the property out of foreclosure, I purchased the property from a bank who purchased the property from another bank who bought the property at auction. The property was listed on the MLS in excess of 30 days when I made my offer at asking. I was represented by an agent, and so was the bank.

[Chance the Gardener]

I definitely have been assessed $100K more than the purchase price. I received a supplemental assessment and talked to the appraiser to confirm that the assessment was not a clerical error. For purposes here, lets assume I paid $500,000 and the assessment was for $600,000. The previous owner’s assessment was $650,000.

You are right, however, that my current tax bill is based on the prior owner’s assessed value. That is not what I am worried about, as I know that if I pay based on the $650K assessment that I will get a refund on the next supplemental roll.

When I spoke with the assessor’s appraiser, he told me that he looked into comparable sales in my building because I had gotten such a good deal and because I purchased the property out of foreclosure. I did not purchase the property out of foreclosure, I purchased the property from a bank who purchased the property from another bank who bought the property at auction. The property was listed on the MLS in excess of 30 days when I made my offer at asking. I was represented by an agent, and so was the bank.

[betting on fall]

Doesn’t the first property tax bill often still reflect the old assessment on a property?

I know when I bought some years back, we got a very small property tax bill based on the old owners base, then get a large supplemental bill.

You may be getting a bill based on the old assessment since they haven’t put your new purchase price into the system yet.

[betting on fall]

Doesn’t the first property tax bill often still reflect the old assessment on a property?

I know when I bought some years back, we got a very small property tax bill based on the old owners base, then get a large supplemental bill.

You may be getting a bill based on the old assessment since they haven’t put your new purchase price into the system yet.

[bubba99]

Prop 13 states:

“The maximum amount of any ad valorem tax on real property shall not exceed One percent (1%) of the full cash value of such property. ”

Until now the assessors have been using the last sale value as “cash value”. It will be difficult for them to claim the sale does not constitute actual cash value.

[bubba99]

Prop 13 states:

“The maximum amount of any ad valorem tax on real property shall not exceed One percent (1%) of the full cash value of such property. ”

Until now the assessors have been using the last sale value as “cash value”. It will be difficult for them to claim the sale does not constitute actual cash value.

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