One outcome of the real estate bubble is that property value assessments and the resulting property taxes have been rising. However, with declining values, foreclosures, short sales etc. the assessed value of the property may actually be higher than what one could get from selling the house.

Homes that sold for over $1 million are now being sold on the foreclosure chopping block for half that price and this is just in one year. For those that bought their home at the peak of the market, 2004-2007, many have found their values have declined 20, 30 even 40 percent. This means that they are typically OVERPAYING property taxes in tune to $1,000-$3,000 each year.

 In 1978, California voters passed Proposition 8, a constitutional amendment to Proposition 13 that allows a temporary reduction in assessed value when property suffers a “decline in value.”

The county assessor uses the purchase price to determine a property’s assessed value and calculates how much property tax to charge the owner.

A decline in value occurs when the current market value of a property drops below the current assessed value.

This can be huge for California homeowners in lowering property taxes thus saving the property owner often hundreds, if not thousands, of dollars each year.

Due to recent housing market conditions, virtually everyone that purchased property in California within the past few years can take advantage of Prop 8 and save money by lowering their property taxes.

If you suspect that you are paying more than you have to in property taxes, you should get educated and fight back by using the law.

 YOU MUST FILE THE DECLINE IN VALUE REASSESSMENT APPLICATION ASAP! If you fail to do it in time you may miss out on huge property tax savings!

To learn more about Proposition 8 (Prop. 8 ) or for professional assistance with your property tax appeal contact Property Tax Appeal Service.