Thoughts on property taxes and Prop 13

[jpinpb]

I was listening to These Days on KPBS the other day and they were interviewing Dan McAllister. He is San Diego County Treasurer and Tax Collector.

He was asked: “Is it true that last year was actually a record year?”

His response: “Last year was, indeed, a record high both for revenue and in terms of taxable parcels that we sent tax bills out for. Last year we hit about 978,000 parcel taxes that we sent bills out for and we received revenues back to the tune of about $4.55 billion dollars, an all-time record high on both levels. This year, in September, we hit another new record high for numbers of taxable parcels”

So I was surprised hearing this w/the declines in property values. Then something clicked in my head, something I asked about not too long ago on Piggington. If you re-fi or take out a HELOC, it doesn’t trigger a re-appraisal of your property taxes.

So, for example, I’ve come across many properties purchased long before 2000 that have NODs on loans significantly higher than what they purchased it for years earlier. All those people, thanks to Prop 13, were paying much lower property taxes.

But now that people are defaulting, some places going to the bank and others going through short sale, many of these places are now being re-assessed to today’s value. Though they are selling for considerably less than the loan amount, the taxes now being paid are considerably higher than the original puchase price.

Some of these properties were purchased in the ’70’s and ’80’s. Way to work around Prop 13.

[UCGal]

I don’t think doing a refi or HELOC triggers a reappraisal – but completing permitted work can. And a lot of people do refi’s or HELOCs to buy themselves additions fancier kitchens.

We had a HELOC for part of our companion unit funding… it was paid off before we got occupancy. The HELOC never triggered a tax change. Getting occupancy definitely did. We’ve refi’d since then (no cash out, though.) and that didn’t trigger anything.

A friend had a similar situation – did an addition on their house – got hit with a tax bill once it passed final inspection.

[UCGal]

I don’t think doing a refi or HELOC triggers a reappraisal – but completing permitted work can. And a lot of people do refi’s or HELOCs to buy themselves additions fancier kitchens.

We had a HELOC for part of our companion unit funding… it was paid off before we got occupancy. The HELOC never triggered a tax change. Getting occupancy definitely did. We’ve refi’d since then (no cash out, though.) and that didn’t trigger anything.

A friend had a similar situation – did an addition on their house – got hit with a tax bill once it passed final inspection.

[UCGal]

I don’t think doing a refi or HELOC triggers a reappraisal – but completing permitted work can. And a lot of people do refi’s or HELOCs to buy themselves additions fancier kitchens.

We had a HELOC for part of our companion unit funding… it was paid off before we got occupancy. The HELOC never triggered a tax change. Getting occupancy definitely did. We’ve refi’d since then (no cash out, though.) and that didn’t trigger anything.

A friend had a similar situation – did an addition on their house – got hit with a tax bill once it passed final inspection.

[UCGal]

I don’t think doing a refi or HELOC triggers a reappraisal – but completing permitted work can. And a lot of people do refi’s or HELOCs to buy themselves additions fancier kitchens.

We had a HELOC for part of our companion unit funding… it was paid off before we got occupancy. The HELOC never triggered a tax change. Getting occupancy definitely did. We’ve refi’d since then (no cash out, though.) and that didn’t trigger anything.

A friend had a similar situation – did an addition on their house – got hit with a tax bill once it passed final inspection.

[UCGal]

I don’t think doing a refi or HELOC triggers a reappraisal – but completing permitted work can. And a lot of people do refi’s or HELOCs to buy themselves additions fancier kitchens.

We had a HELOC for part of our companion unit funding… it was paid off before we got occupancy. The HELOC never triggered a tax change. Getting occupancy definitely did. We’ve refi’d since then (no cash out, though.) and that didn’t trigger anything.

A friend had a similar situation – did an addition on their house – got hit with a tax bill once it passed final inspection.

[briansd1]

[quote=jpinpb]

So, for example, I’ve come across many properties purchased long before 2000 that have NODs on loans significantly higher than what they purchased it for years earlier. All those people, thanks to Prop 13, were paying much lower property taxes.

But now that people are defaulting, some places going to the bank and others going through short sale, many of these places are now being re-assessed to today’s value. Though they are selling for considerably less than the loan amount, the taxes now being paid are considerably higher than the original puchase price.

Some of these properties were purchased in the ’70’s and ’80’s. Way to work around Prop 13.[/quote]

Interesting observation.

The refi madness of the boom years is causing long time owners to lose their houses. Of course, the new owners of those house should have to pay higher assessed values based on the new purchase prices.

[quote=jpinpb]
Way to work around Prop 13.[/quote]

Churn is a great way to lose the Prop 13 cap. Bad for the homeowners but good for local government.

[briansd1]

[quote=jpinpb]

So, for example, I’ve come across many properties purchased long before 2000 that have NODs on loans significantly higher than what they purchased it for years earlier. All those people, thanks to Prop 13, were paying much lower property taxes.

But now that people are defaulting, some places going to the bank and others going through short sale, many of these places are now being re-assessed to today’s value. Though they are selling for considerably less than the loan amount, the taxes now being paid are considerably higher than the original puchase price.

Some of these properties were purchased in the ’70’s and ’80’s. Way to work around Prop 13.[/quote]

Interesting observation.

The refi madness of the boom years is causing long time owners to lose their houses. Of course, the new owners of those house should have to pay higher assessed values based on the new purchase prices.

[quote=jpinpb]
Way to work around Prop 13.[/quote]

Churn is a great way to lose the Prop 13 cap. Bad for the homeowners but good for local government.

[briansd1]

[quote=jpinpb]

So, for example, I’ve come across many properties purchased long before 2000 that have NODs on loans significantly higher than what they purchased it for years earlier. All those people, thanks to Prop 13, were paying much lower property taxes.

But now that people are defaulting, some places going to the bank and others going through short sale, many of these places are now being re-assessed to today’s value. Though they are selling for considerably less than the loan amount, the taxes now being paid are considerably higher than the original puchase price.

Some of these properties were purchased in the ’70’s and ’80’s. Way to work around Prop 13.[/quote]

Interesting observation.

The refi madness of the boom years is causing long time owners to lose their houses. Of course, the new owners of those house should have to pay higher assessed values based on the new purchase prices.

[quote=jpinpb]
Way to work around Prop 13.[/quote]

Churn is a great way to lose the Prop 13 cap. Bad for the homeowners but good for local government.

[briansd1]

[quote=jpinpb]

So, for example, I’ve come across many properties purchased long before 2000 that have NODs on loans significantly higher than what they purchased it for years earlier. All those people, thanks to Prop 13, were paying much lower property taxes.

But now that people are defaulting, some places going to the bank and others going through short sale, many of these places are now being re-assessed to today’s value. Though they are selling for considerably less than the loan amount, the taxes now being paid are considerably higher than the original puchase price.

Some of these properties were purchased in the ’70’s and ’80’s. Way to work around Prop 13.[/quote]

Interesting observation.

The refi madness of the boom years is causing long time owners to lose their houses. Of course, the new owners of those house should have to pay higher assessed values based on the new purchase prices.

[quote=jpinpb]
Way to work around Prop 13.[/quote]

Churn is a great way to lose the Prop 13 cap. Bad for the homeowners but good for local government.

[briansd1]

[quote=jpinpb]

So, for example, I’ve come across many properties purchased long before 2000 that have NODs on loans significantly higher than what they purchased it for years earlier. All those people, thanks to Prop 13, were paying much lower property taxes.

But now that people are defaulting, some places going to the bank and others going through short sale, many of these places are now being re-assessed to today’s value. Though they are selling for considerably less than the loan amount, the taxes now being paid are considerably higher than the original puchase price.

Some of these properties were purchased in the ’70’s and ’80’s. Way to work around Prop 13.[/quote]

Interesting observation.

The refi madness of the boom years is causing long time owners to lose their houses. Of course, the new owners of those house should have to pay higher assessed values based on the new purchase prices.

[quote=jpinpb]
Way to work around Prop 13.[/quote]

Churn is a great way to lose the Prop 13 cap. Bad for the homeowners but good for local government.

[an]

Could it possibly just mean that the majority of home owners bought their house long time ago, so they’ll still be hit w/ the increase, since their appraised value for tax purposes is way under the current value.

[an]

Could it possibly just mean that the majority of home owners bought their house long time ago, so they’ll still be hit w/ the increase, since their appraised value for tax purposes is way under the current value.

[an]

Could it possibly just mean that the majority of home owners bought their house long time ago, so they’ll still be hit w/ the increase, since their appraised value for tax purposes is way under the current value.

[an]

Could it possibly just mean that the majority of home owners bought their house long time ago, so they’ll still be hit w/ the increase, since their appraised value for tax purposes is way under the current value.

[Author]

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