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As we all know Sacramento home prices have declined over the last four years which means Sacramento County has brought in less money from property taxes. Due to lower property taxes Sacramento County has a huge deficit.
Sacramento County is short by at least $10 million dollars due to declining home values not producing enough revenue in property taxes.
It took up to six months for Sacramento County to update new assessed values but now due to the overwhelming home sales and reduction in personnel, it may take up to 2 years before Sacramento home buyers see a change in their property tax bills. Totally unacceptable!
What does this mean?
It means, Sacramento County is using new homeowners tax money to leverage their deficit at the homeowner’s expense. In other words, if you bought a house this year for $250,000 that originally sold for $400,000 to the previous homeowner, you may be paying property taxes based on $400,000 for up to 2 years before Sacramento County corrects the mistake and updates your new property taxes for your purchase of $250,000.
Considering there are many new home buyers and new homeowners who are struggling to get into homeownership, this may cause an undo hardship for many and could effect whether a new home buyer can afford to buy a house. This is something Mayor Kevin Johnson and the Sacramento City Council best think very seriously about when reducing staff and reassigning job priorities…are you biting off the hand that feeds you?
Sacramento County will be making money on the backs of the new homeowners and using their money. Don’t expect to be paid interest on the money Sacramento County makes off of you…this appears to be a one way street!
On the Sacramento County Assessor’s web site it clearly states that residential properties affected by declining real estate prices will be posted on June 1, 2009 with their assessed values for the 2009-2010 assessment roll. If you disagree with the assessed value you may appeal that decision with the Sacramento County Assessor’s office. Maybe this need to be revised.
After contacting the Sacramento County Assessor’s office, I was informed that by law they can not process new home sales before the following July and those values are for the following year. They will NOT confirm that it will take up to two years to process but do say that they are working on these changes along with their OTHER regular work and are doing the best they can.
Sacramento home buyers and new Sacramento homeowners who bought a house or condo this year, in a Foreclosed home for sale or Short Sale for sale need to plan on paying higher property taxes until the County Assessor’s office gets it right. If you have your taxes paid by an impound account, you may find there is a shortage since your impound is based on what you paid for the property not what the previous seller paid. You will need to come up with this shortage.
I wonder if it were the other way around and the homeowners owed MORE money in assessed value, if the process would take a shorter amount of time and the more County employees were assigned to update their records? Just a thought…
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Fantastic job keeping everyone in the loop! I hope people will read this because ALOT of people will NOT find out about this until a shortage on the impound account.
Excellent job again Gena!
-Uppal Insurance
Thanks. I hope Sacramento City Council reads this as well before they end up hurting real estate further!
I got wind of this 2 months ago when my client asked me about reassessments after purchases. I called the assessors office and they point blank told me that when the market is appreciating, they process the reassessment immediately. When it’s depreciating, it could take 6 months! Sounds like it may be time for civil litigation! Great article Gena!
Hi Rob,
Sounds like a one street and in the end although they will make money on the interest, I think it will hurt them in the end. Some buyers will be knocked off due to this. Time for a tea party!