Is your property tax assessment too high?

In the 4th quarter of 2022, Santa Clara County home prices bottomed out after 6 months of interest rate hikes and sliding home values. The property tax assessment for many home owners on January 1st from the county tax assessor’s office may have been higher than market value for that day, depending on which comparable sales or comps that office used.

If your property tax assessment for this year came in a little higher than market value, you may be able to appeal that assessment.

 

Property tax assessment bill - the annual county tax assessor's office will issue the valuation to home owners on this card each September or October

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Appealing the property tax assessment

 

The county tax assessor’s office uses comparable sold properties, or comps, just like you or I would do, to try to determine the current market value of your home.  The comps used may or may not be the best or most realistic – they could be too dissimilar in size, location, or amenities, for instance.

If they aren’t good, you may be able to get your home’s assessed value, and hence the bill, reconsidered if you present better data and explain why your data is more accurate.

No one wants to see their property values depressed, but if it does happen, there may be a small silver lining: getting slightly lower property taxes, at least for a while.

 

How to appeal your property tax assessment

START HERE TO APPLY – you will find the prerequisites, the instructions, and the login to begin. (Have your comps ready!)

Information on appealing can be found on the county tax assessor’s office website.  This page has links and information on the process and procedures of appealing the valuation.

The appeal application form can be found here:  Assessment Appeal Application form

The folks in charge of the property tax assessment and appeal process, the review, and the hearing are:

Assessment Appeals Division
70 West Hedding Street
East Wing, 10th Floor
San Jose, CA 95110
Phone: (408) 299-5088
Fax: (408) 298-8460
Email: AssessmentAppeals@cob.sccgov.org

It’s actually very straightforward to appeal your property tax assessment: you simply complete the form and submit it online together with PDFs of your comparable sales to provide support for the lower valuation. The application form states at the end: “The request must contain the basis of your opinion of value. Please include comparable sales, cost, and income data where appropriate to support the value.”
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When is the next downturn in Silicon Valley? How bad will it be?

Fear of Peak PricingA question I’m getting a lot lately has to do with when the Silicon Valley real estate market will peak.  We’ve had 4 straight years of very strong appreciaion. In east Los Gatos, houses that were selling in early 2012 for about $1,000,000 may now sell for $1,500,000. Consumers have to ask: where will it end?  When do people simply refuse to pay, and move elsewhere?

I don’t have a crystal ball, but I have experienced downturns, and on average they seem to happen about every 10 years in the San Jose – Santa Clara County area.  Usually the “runup” between the downturns is a ton more than the correction.  Often the price rollback is about 10%, while the 10 year period between price corrections might be 30-50%.

Yes, a correction is probably coming.  Yes, our prices are out of control due to a lot of hiring locally and fantastic interest rates combined with a terribly tight inventory.

When? When will prices come back down to earth?

My best guess – and that’s all that it is – is that it will be sometime in the next 2 years or so. Probably not this year because Apple and Google seem to be hiring like crazy (and they are not alone).  Maybe it’ll be in 2017.  Maybe 2018.  But I think before spring 2019. That said – I could be wrong.

Should you wait to buy, then?

Nope.  In my opinion, if you want to make a life for yourself here and plan to stay put 5-10 years, go for it.  Interest rates are good now and may not be in 2 years.  Prices are still climbing.  And heck, if you can stay put for 5-10 years, even if you do buy at the beginnig of a correction (which I did in 1989), you’ll be ok if you can buy and hold.  And the bonus is that in the meantime, if it’s an owner-occupied property, you get a nice tax benefit (talk to your CPA or tax professional about that.)

 

 

 

How to be a “bad neighbor” and lower neighborhood home values at the same time

Almost every neighborhood has a “bad neighbor” or two.  Nearby residents, and especially home owners, roll their eyes, mutter quietly and often say nothing to the offender so as to avoid a blowout with the “problem neighbor”.

If you’re buying a home, or moving into a new neighborhood, you may not know about these bad apples and their nuisances.  But sometimes there are clues – things right out in front that are hard to miss.  Even where there aren’t any hints of trouble, you can always knock on doors and ask about the area.  Problems can be visual, auditory, olfactory or other. Ask – people will talk! A list of things which annoy the neighbors and possibly lower home & property values follows below.

A list of “bad neighbor” behaviors: bad sounds, bad sights, bad smells top the list (more…)

San Jose Housing Inventory and Real Estate Prices

366 houses for sale in San Jose 2-27-2013

San Jose housing inventory is critically low, and this is pushing real estate prices higher and higher.  Home buyers are finding that not only do they get outbid on pricing in this market, they are also out maneuvered on terms as others dare to write purchase contracts with no contingencies of any kind or bring 100% cash to the closing table.

Today we’re going to consider the realty market trends for houses (inventory, pricing and market momentum) in the city of San Jose courtesy of Altos Research, to which I have a subscription, and using some other tools as well.  This is helpful information for area home buyers or sellers to better understand the negotiating lay of the land.  (For newcomers: San Jose represents a little more than half of Santa Clara County and is often reflective of how the rest of the county is doing.)

Let’s start with inventory.  How many houses are for sale today in San Jose? Just turned to MLSListings.com and searched – as of right now, there are a measly 366 single family homes for sale in San Jose which are not under contract.

 

San Jose Housing Inventory 30 days

San Jose Housing Inventory the last 30 days

San Jose housing inventory for the last year

San Jose housing inventory for the last year

 

 

 

 

 

 

 

 

Now let’s look at the trends over the last three years – I marked each year’s peak with the green diamond to highlight the pattern.

 

San Jose inventory of houses for sale over the last 3 years

San Jose inventory of houses for sale over the last 3 years

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