If your assessed value is higher than the current value of your property, you may be paying too much in property taxes. Given the surge in property values that we saw in the first quarter of 2022, it’s very likely that there are some new homeowners with assessments that are significantly higher than today’s value. Another possible situation is buyers who bought in recent years and bid significantly over their competitors, to make sure that they got the house, because most often the tax assessor places the initial assessed value at the amount of the sale. Of course, there are other circumstances that could lead to a high assessment, but these two are the most likely.
Here’s an example of the second scenario. A Danville house that would have sold in 2021 for $1,800,000, went on the market in February 2022, listed for $2,200,000. It should have been difficult to get the inflated price. However, due to high demand and low inventory, the sellers received 12 offers. Ten of the offers came in at or slightly above the asking price. However, 2 of the offers came in at over $3 million. Of course, the sellers chose one of the highest offers. Fast forward to January 2023, following an eight month correction in the market. Even though two buyers decided last year that the home was worth over $3 million, today’s reality might be closer to $2 million.
California State Revenue and Taxation Code, Section 51 authorizes the Assessor to temporarily lower the assessed value of any real property when it is greater than the market value as of the January 1, lien date. If you have evidence that the market value of your property as of January 1, 2023 is less than the assessed value, you can file a simple “Request for Value Review” with the County Assessor.
To start the process, simply go to the Contra Costa County Tax Assessor’s page (https://www.contracosta.ca.gov/191/Assessor) and select, “Review Your Value.” Select the appropriate property type. This takes you to a very simple, one page form that you can print, complete and return to the Assessor. The form asks for your contact information, the property information, and 3 “comparable sales” to support your case. Please note that you must still pay any tax bills received, on time. If the review results in a change in your assessed value, then your taxes will be adjusted to reflect the difference.
Unless you are really up on the market, the best way to find your 3 “comparable sales” is to contact your Realtor®, who can provide you with the most accurate data. It’s important to note that the circumstances this year may be especially favorable, as values on January 1, may have been at their lowest. We are currently seeing a strong spring market and some values have picked up again. If you’re curious about the value of your home and/or whether or not you may qualify for a Value Review with the Assessor, please feel free to reach out to me at 925-964-5010 or via email at Lisa.Hopkins@Compass. com. I’d be happy to provide you with a complimentary evaluation.
