Property tax cuts coming for 89,000 L.A. homeowners

I have good news for 89,000 L.A. homeowners today: You're getting a property tax reduction.

Now I have bad news: The value of your house has declined by, on average, $68,000.

Update from the L.A. County Assessor's office: The office is roughly halfway through a review of 316,000 single-family homes and condos for potential decline in value. The review covers homes purchased between July 1, 2004 and June 30, 2007. Numbers:
--186,000 homes have been reviewed.
--Assessed values have been reduced on 89,000 homes.
--Average reduction in assessed value is $68,400.
--Average reduction in property taxes is $684 per house.

Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Photo Credit: L.A. Times

Comments

[Laker]

Peter, you can rephrase it with this addition:
BOTH are good news for the true home owners that look to keep their houses or to move up one day.
"...the value of your house has declined by, on average, $68,000..." is wonderful news.
1) The property taxes will be lower
2) Insurance premiums will be lower
3) The ability to upgrade and move to bigger house will be easier as it will require less in mortgage payment difference.
4) Speculators will be looking for other assets to jump on, leaving houses to the people that actually need them to live in them.
Summary:
Great news to true home owners
Bad news only to the speculators, fraudsters, house flippers.
Is it bad news to you Joe 6 pack? Can you hear me now???

[Cal]

Simple math gives an estimate of $100 million in lost revenue for the County.

89000* 684 = ~60 million

60 mil on 186,000 homes reviewd, so they are 58% through the reviewing process.

60 mil divided by 58% = 100 million.

I think the state is somewhere in the (optimistic) 16 billion in revenue shortfall.

State, County, Federal government are large employers and all are coming under revenue pressures. We will see layoffs soon and it will start a domino effect of even more lower revenues. This is the deflationary spiral that the Fed is trying to break. The one thing that will help the state is the already approved bonds, they will cushion the blow, but that is more debt we will have to pay back.

[Jason]

Does Prop 13 only apply to rising property taxes?

[laurent]

For the last few years, municipalities' income from real estate tax has soared. Now that their real estate income is plummeting, some (not LA, obviously) are trying to raise taxes to compensate.

But how have these cities spent the extra revenues? Have you seen significant improvements in your hometown? Are the streets better than ever? Is the drainage system updated? What about sewage plants and all the likes the municipalities funds? In my town, things have not changed much. So where did the money go? And what warrants the tax increase?

[ScottQ]

The extra money all went to pay for infrastructure for the explosive building boom. In other words, all that tax revenue was really a giant subsidy to developers and builders, with the true costs of mass development hidden from new home buyers because their existing neighbors picked up most of the tab.

It's time to change planning and zoning laws and make developers - and their customers - front the real costs of growth, not pretend that it's all self-financing. Not only does the current practice unnecessarily burden existing homeowners and businesses, it also distorts state and local government finances and is a hidden cause of massive inflation that keeps penalizing communities for years after the developers have left town with their profits.