REAL PROPERTY APPRAISAL
Under Proposition 13, the base year value for real property is appraised only when:
- A change in ownership occurs; or
- New construction is completed
Construction in progress and assessments lowered due to market declines are appraised each lien date January 1st (See Proposition 8)
Base year assessments cannot be increased by more than 2% annually. For more information regarding the actual tax rate and direct charges for individual parcels, please view the Property Tax Division of El Dorado County Auditor's website.
NEW CONSTRUCTION BUILDING AN IMPROVEMENT:
If you own a parcel of land and build a structure (a house, outbuilding or garage), this will usually increase the value of the property. California statutes refer to such structures as improvements. The Assessor is required to add the value of these improvements to the assessment roll. The land value will not usually be changed due to new construction of a structure.
ADDING NEW AREA:
If you increase the living area of your home you have completed "new construction." Since new construction typically increases the value of a property, the Assessor must add the value of the addition, but only value associated with the new addition.
Q: If my construction is not complete by January 1, will I be assessed?
A: Yes. We will review the work on or about January 1, and you will be assessed on the value of the work completed.
Q: I plan to add another room on my home. Will you reappraise my entire property?
A: No. Only the value of your new addition will be added to your current assessed value.
To maintain your property's current value, you might need to paint your home or make some repairs. Typically, normal maintenance (such as painting or a new roof) would not cause a reappraisal and there would be no new assessment added by the Assessor.
A complete rehabilitation of a property, which makes it substantially the equivalent of new or changes the use of the property, is considered new construction and does require reappraisal.
DECLINES IN VALUE:
The value of property may decline for any number of reasons. California law requires the Assessor to recognize these declines and when appropriate, reflect the decline in the assessed value of the property. Click here for an electronic application for review of your assessment.
There are three major causes of value decline:
Removal of Improvements - Most property will lose value when structures or other improvements are removed. If improvements have been removed from your property, you should contact the Assessor's Office at 530-621-5719.
Calamity or Disaster - If your property has been damaged by a calamity such as a fire or flood, you are entitled to property tax relief under R & T Section 170. Although our office makes every effort to follow up when we become aware of these occurences, please contact us at the above number or click here to email us so we can evaluate the damage and lower your assessment accordingly.
Real Estate Market Declines (Proposition 8) - The market value of real estate can decline for a variety of reasons including external factors such as neighborhood changes, road alignments, zoning changes as well as supply, demand and the economy in general.
In California, Proposition 13 established a 1975 base year value for property until a new base year value is appraised as a result of a change in ownership or new construction. By statute, a maximum of 2% increase is applied to the base year value annually. This value is called the trended or factored base year value. Proposition 13 made no provision for a decline in value.
A subsequent constitutional amendment (Proposition 8) requires the Assessor to recognize a temporary loss in value. Each year, the Assessor is to enroll the lower of either the factored base year value or current fair market value on the lien date, January 1st. Under Proposition 8, the assessed value is reviewed annually and increased or decreased according to the market, until the market value once again exceeds the factored base year value. At that time, the trended or factored base year value is re-enrolled, regardless of how high the market value climbs. Since the proposition 8 value is driven by the market, these temporary decreases or increases may be greater than 2%.
Because of the current real estate conditions in El Dorado County, it is quite possible that the value of properties purchased in and after 2004 may be eligible for a reduced assessment (under Proposition 8). This condition generally applies to residential property in the west end of the county and along the Highway 50 corridor. Property acquired before 2004 is generally still assessed at less that the current market value.
If for any reason, you believe the assessed value of your property is more than the market value, please click here for an electronic application for review. Results of our review can be obtained after July 1, by viewing your property value on the on-line property information feature of this website. Questions and Answers about Decline in Value (Proposition 8)
IMPORTANT FACTORS ABOUT MARKET VALUE DECLINE REVIEWS:
- This type of property tax relief generally applies to more recently purchased property.
- Decline in Value (Proposition 8) reviews look at market value as of the "snapshot" lien date of 12:01am January 1st.
- The review is of the total real property value. Land or improvements are not considered separately.
- Property tax payments are due as shown on the bill. If an adjustment to the assessment occurs, a corrected bill or refund will be made by the Auditor/Controller and Tax Collector.
- If you do not agree with our review you may file an appeal. The filing period is from July 2 through November 30, or 60 days from the notice date in the case of an escaped assessment or supplemental assessment. Contact the El Dorado County Assessment Appeals Board (El Dorado County Board of Equalization) at the Board of Supervisors Office 330 Fair Lane, Placerville, Ca. 95667, or telephone 530-621-5654.
Decline in Value Examples:
1. I purchased my home in the late 1980's. The total assessed value on my 2007-2008 property tax bill is $192,423. The market value of my property on January 1, 2008 is $450,000.
Your property in this example does not qualify for relief, because the assessed value is lower than the market value. This type of property tax relief generally applies to more recently purchased or newly constructed property.
2. I purchased my home in July of 2006 for $600,000. The total assessed value on my 2007-2008 property tax bill is $612,000. Sales of similar homes up to January 1, 2007 were from $500,000 to $575,000.
Your property in this example may qualify for relief, as the sales of comparable properties indicate the market value on January 1, 2007, is lower than the assessed value.
3. I purchased my home in September 2006 for $500,000. The total assessed value on my 2007-2008 property tax bill is $500,000. Sales of similar homes in October through January 1, 2007 were $500,000. Beginning April of 2007 were $450,000 and current listings for sales are even lower.
Your property in this example does not qualify for relief for the 2007-2008 tax year because the assessed value was lower than the market value on January 1, 2007. However you may qualify for relief in tax year 2008-2009, if the market value on January 1, 2008 is lower than the assessed value.
4. A property was purchased for $600,000. During a three year period, the real estate market declined and recovered. The property owner filed for a decline-in-value reassessment. The following table shows the trended base value, the market value of the property, and the assessed value of the property, assuming a 2% Annual Consumer Index (C.P.I.):
Decline in Value Example
||Factored Base Year Value
||$612,000 (Factored Base)
||$575,000 (PROP 8)
||$600,000 (PROP 8)
||$649,459 (Factored Base)