This is good news for property owners who were here in 2008 when the market took a dive and lost value on their property as result of that, and during that time many owners had their property taxes go down. But now the table has turned and its time to pay the piper because property owners in this valley are going to be hit with a rude awakening with a higher property tax bill.
Photo Source: dentonlawyer.com
Property values reach milestone: $409 billion in Santa Clara County
SAN JOSE--Just a few weeks ago, the tax man said Silicon Valley's booming economy was driving property values so high that a good number of homeowners should expect a sizeable bump in their tax bills. On Wednesday, Santa Clara County Assessor Larry Stone all but delivered on that promise when he announced that the assessment roll had hit a milestone -- $409 billion.
"The demand is driven by job growth, and Silicon Valley is at the epicenter of the nation's recovery," Stone said in a prepared statement.
The value of residential property and apartment rents has exploded, the assessor said. The median price of single family homes in the county increased 11.1 percent to $810,000 last year. The average price of homes sold was even higher a whopping $1.1 million.
The roll is a snapshot of the assessed value of all real estate and business property in the county as of Jan. 1. After exemptions, the net amount that can be taxed is about $388 billion. That's still an increase of 8.7 percent, or $31 billion over last year.
Stone said the recovery is "positive news" for homeowners who saw their largest asset lose equity or even sink underwater -- lower than the purchase price -- during the Great Recession, which many economists date from 2008 to 2012. Many of these homeowners saw their property taxes reduced, but Stone said he'll have to restore the assessed values that were reduced during the downturn. Last year, 38,000 properties were assessed below their market values. That number dipped to 22,000 this year.
"The residential real estate market has been so strong that some property owners will experience double-digit increases in their assessments," Stone said.
He added that major office and apartment building in northern parts of the county, including northern San Jose, is driving property values upward. A symbol of this growth, he said, is Levi's Stadium, assessed at $1.4 billion. Another is the new Apple campus, still under construction, which he assessed at $820 million.
Meanwhile, the average rent for a two-bedroom apartment in San Jose reached $2,300 a month.
"It is a huge crisis for people who are already doubling up in apartments and living in garages," said Poncho Guevara, head of Sacred Heart Community Service in San Jose.
He described the super-hot recovery as a double-edged sword for the working poor: There are more jobs out there, but higher earnings at the lower end of the employment spectrum aren't keeping up with escalating rents.
During the recession, Guevara said, the number of people coming to Sacred Heart for services or food baskets doubled to about 75,000 in 2014.
"The biggest pressure people are facing right now is the cost of housing," he said. "They're coming to us for food because they can't afford the rent."
Stone said homeowners who think their assessments are higher than market value should file appeals.
Source: The San Jose Mercury News, Joe Rodriguez
http://www.mercurynews.com/bay-area-news/ci_28409575/property-values-reach-milestone-409-billion-santa-clara
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