How To Lower Your Property Taxes: Property Assessors Hurt Homeowners

Curious to learn how to lower your property taxes? You've come to the right place. I successfully lowered my property taxes for three years in a row during the 2008-2009 financial crisis. Your property tax bill is one of those pesky ongoing expenses that keeps going up if you don't take action.

As a homeowner, it's up to you to fight like hell to keep your housing expenses as low as possible. During times of uncertainty, we should all be fighting to lower our property taxes. Sadly, the government won’t do the right thing and automatically lower your property tax bill if your property’s value declines.

If my housing market prediction is correct, you property taxes will likely rise because housing prices are likely to continue going up. Mortgage rates are coming down in 2024+, pent-up demand is increasing, the stock market is near an all-time high, and the economy is strong.

However, that doesn't mean you shouldn't fight to lower your property taxes if you think the assessed value is too high.

The Property Assessor's Office Is Not Your Friend

Your property assessors' #1 goal is to collect as much property tax from you as possible. Your goal as a homeowner is to make your home look like the dumpiest of dumps to pay the least amount of property tax possible. Downgrade your property statistic online to make your home look worse than it is.

An asteroid could wipe out your entire city. But if the assessors office survives, they will come for you to collect!

During the 2008 downturn, I religiously filed a property tax appeal to get my assessed value lowered. In the midst of the financial crisis I was shocked that the assessors office appraised my primary residence for $100,000 more. If they got away with it, I would have paid roughly $1,200 more in property taxes that year. I ultimately won my appeal three months later and kept my assessed value the same as before.

For the next three years I got more aggressive and managed to lower my assessed value $100,000 below my purchase price. When the world is falling apart, it's an easy sell to say your property's value is also going down the tubes.

In fact, your goal is to get the city to assess your property as close to $0 as possible.

This post will highlight how I almost got screwed over by the San Francisco property assessor again. I'll explain how I fought back and came to a compromise.

Just like how every homeowner should be taking action to refinance their mortgage with rates at record-lows, every homeowner should take action by filing property tax appeals!

How To Lower Your Property Taxes: A Conversation With A Property Assessor Employee

Back in the Spring of 2012, I filed a property tax value appeal because the City raised my property's assessed value by a whopping $270,000 (13%). That's equivalent to roughly 100,000 packs of the highest quality ramen noodles. If I ate a generous three packs a day, that would be 91 years of sustenance.

A $270,000 higher assessed property value leads to roughly $3,000 more in property tax a year. Prop 13 usually allows for only a 2% maximum property tax increase per year. However, I got reset back to my original purchase price plus an extra 1.8% increase for the latest calendar year.

If you ever want to know what tyranny looks like, this is it. If I don't pay the increase, my credit score will get crushed, I'll have to pay fines, and will ultimately have to go to jail. Ain't power grand?

Find Low-Priced Comp Sales Online

Undaunted, I went to Zillow to get 10 comparables at lower price/sqft levels than my house between October 2011 and March 2012 to keep my assessed value down. I filled out the application, attached a $60 mandatory appeals check, and waited.

How To Lower Your Property Taxes

Five months later, I finally get a letter in the mail saying they have acknowledged receipt of my application for appeal. The letter then goes on to state that I will be notified by mail 45 days in advance of my scheduled hearing date.

Meanwhile, there are no specifics of when that hearing date might be! I call the SF Assessment Appeals Board at 415-554-6778, and a supremely pissed off lady answers the phone. Before letting me ask my questions, she tells me exactly what I want to know.

The Conversation With An Angry Employee

Before you ask anything, hear me out because I've been answering this question all week. Times have changed. What used to take two to three months to schedule a hearing or reduce your assessed value now takes up to two years!

At some point next year, you will get another letter from us with your scheduled hearing date. IF you win your appeal, the city has another nine months to refund your property tax overage. Meanwhile, you are required by LAW to pay your property tax this year, no matter how wrong the valuation is!

She goes on to say…..

You are lucky you filed a 2012-2013 property tax appeal in the first place. There are thousands of people who naively assumed the City would lower or keep their assessed values the same because the economy is still on shaky ground. Some people have seen their home's valuations increase by $1 million and there is nothing they can do about it but pay the extra $11,500 in property taxes!


My boss, Phil Ting's job is to collect as much property tax from the public as possible, no matter the economic environment. He will never get voted out because only 30% of San Franciscans own property. The measures he puts in place raises property taxes for homeowners and redistributes the funds towards other programs for those who don't pay.

I quizzically ask, “So you're saying I should sell my house and live off the backs of others? Who should I vote for?

She replies, “You are not listening to me. 65-70% of San Franciscans are renters. They will always vote to raise property taxes since they don't have to pay for them. This is the way the city gets more funding for public works and for teachers, regardless of whether the homeowner has children or uses public works at all. It's obviously better to be a homeowner, but my boss' sweet words will keep him in office forever!

The lady was pissed because she was bearing the brunt of all these angry homeowner phone calls. Appeals have gone from 1,600 a year to 6,000 a year, while the number of people in her office has stayed the same! She hates her boss and is ultimately on our side.

Related: Property Tax Rates By State: Why Homeowners Should Embrace Property Taxes (contrarian view)

Simple Steps To Lower Your Property Taxes

Now that you know what it's like inside the assessor's office, here is how to lower your property tax bill. Take these specific steps.

1) Google “<Your City’s Name> assessor’s office.”

It’s important you proactively find out what the city/county is assessing your property for first before you prepare for battle. Chances are the city has already sent you a property assessment letter before the property tax bill is due.

2) Go to their contact page and call and e-mail them every single day until you get a response.

I’m not kidding. The property assessors office slow. Make sure all your v-mails and e-mails are polite. However, stay stern saying you disagree with your property valuation assessment with proof.

3) After they respond, you must specifically ask how they came up with their assessment value.

Ask them to provide comparables. Also, ask them what you need to do to make your case. There will undoubtedly be appeal forms to fill out. Fill them out and make copies for yourself (important as they like to tell people they never got it 2 months later, hoping you’ll give up and be too late!)

4) Like any good negotiator, you must highlight the lowest comps and negotiate accordingly.

Let’s say your house is worth $1 million. Go in with horrific comparables that look like bomb shelters in terrible locations. Use the house next to a fire station that may be worth $500,000 instead.

Your comparables need to be similar in dimensions and as close to your home as possible. The comparables should also ideally be properties that have sold within the past six months.

Set your anchor lowThe more comps you can provide, the better. You can easily get comps from Redfin and Zillow. The assessor doesn’t usually have time to verify the comps physically, and just uses online comparisons.

5) Make sure you courteously follow until you get confirmation of receipt over e-mail and phone.

One year after reaching out in February, I failed to follow up with more comps until July (big mistake). By then, the assessor had moved to valuing a different district, and another person in the property assessors office was recommended to me.

Good thing the new person had the forms I handed in and  decided to e-mail and call me back. Otherwise, I would have wasted a lot of time. Don’t forget to back up all your data!

6) Continue to file a property value appeal every year. 

The person at the assessors office is always hoping homeowners continue to stay naive and don't file appeals. Once you get your fall property tax bill, it is TOO LATE to file an appeal for the current year.

For example, San Francisco property tax appeals are allowed between July 2 and Sept 15 every year. Do not miss your city's window. Eventually, you will have your hearing and justice will be had.

7) Take to social media to get a response.

After hitting a roadblock, I was able to send a tweet to @PhilTing (SF Property Assessor Head) who responded to my inquiry within 12 hours. He sent me the name and person to contact to expedite my case and it worked. Using Twitter to help your cause can't hurt, especially if you have a relatively large presence.

8) Consider hiring a real estate lawyer.

If you don't want to do anything I just said, you can always hire a real estate lawyer who specializes in lowering your property tax bill. If successful, he or she will take a cut of you property tax bill savings. There's usually no downside for you.

However, you should be able to fight your property tax bill yourself given you can easily find all the information you need online. Redfin and Zillow have all sales records and details of comparable homes.

The Property Assessors Office Is Willing To Negotiate

For three years in a row, I managed to prevent my property taxes from going up. I took action and it paid off to the magnitude of roughly $3,000 a year in property tax savings. I finally hit a wall for the 2012-2013 tax year due to a rising market and the incredible logistical roadblocks they've placed to appeal.

Just as hope was growing dim, an angel gave me a ring. It was one of Phil Ting's henchmen (Assessor head). He saw my Tweet and reviewed my case. He was willing to negotiate.

After making my case why my property should be assessed lower over the phone twice, I got the assessor's office to split the difference. He raised my assessed value higher by “only” $150,000 from $270,000 originally. Paying $1,800 more in property taxes is better than paying $3,000 more.

Another thing, due to a bull market in real estate, your homeowners insurance coverage likely needs to be increased. Some homes have increased by 30%+ since the pandemic began in early 2020 alone.

Yes, homeowners insurance is an ongoing liability like property taxes. It's up to you to decide how comfortable you are underinsuring your home.

Don't Give Up The Property Tax Fight

If you are a homeowner who feels you have been wronged by your city's assessors office, do not give up! Realize the government is expecting you to roll over and die. The government is counting on you not to make an effort.

However, just like everything in life, those who make an effort often get rewarded. Unfortunately, my latest attempt at fighting my property taxes failed. The housing market is just too strong. You can read this post for more details on why I lost my property tax appeal.

The good thing about my loss is that I learned a lot more things to share with all of you. Losing my property tax appeal also means my properties are continuing to gain in value.

Keep Investing In Real Estate

Real estate is still my favorite asset class. However, in order to build long term wealth, you must do your homework and fight the powers who are trying to prevent you from achieving financial freedom.

The pandemic has caused budget shortfalls. Therefore, there will likely be an uphill battle to lowering your property tax bill. With cities and states facing large budget deficits, I suspect the assessor's office will be more strict.

At the very least, don't let the assessor's office rip you off . I've seen many instances where the assessors office will say the fair market value is 10%+ higher than reality. If this is your situation, please fight back!

Real Estate Suggestions

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For individual deals, check out CrowdStreet. CrowdStreet focuses on 18-hour cities where valuations are lower and cap rates are higher. CrowdStreet connects you with some of the top sponsors, but you must still carefully reviewing each sponsor and deal to create your select portfolio.

Real estate is a key component of a diversified portfolio. Real estate crowdsourcing allows you to be more flexible in your real estate investments by investing beyond just where you live for the best returns possible. Since 2016, I've personally invested $954,000 in private real estate funds.

How To Lower Your Property Taxes is a Financial Samurai original post. I've been helping people achieve financial freedom since 2009. Join 60,000+ others and sign up for my free private newsletter.

97 thoughts on “How To Lower Your Property Taxes: Property Assessors Hurt Homeowners”

  1. Hi Sam, REBUY years = house value/ value of property& school taxes
    Easton MD $500,000/$1800 = 277 years
    Hamburg NY $200,000/$12,000= 17 years
    With senior citizen NYS star program $200,000/$6000= 33 years

  2. Mike Miller

    I bought my home in 2019 and my property taxes have risen every year since. The house I bought is in an area that has a fixed range where I can’t sell at a higher price to help lower income families get homes. If I can’t sell it for more than what it was appraised for, why do I still have to pay the higher tax?

  3. I was lucky enough, in 2011, to come across a guy in Corpus Christi, who did this as a sideline for people.

    Over the next few years and until we sold our property, we saved thousands of dollars, by his “sideline” representation to the board lowering our taxes and then arguing to keep our taxes as low as he got them.

    Did he get a cut? Yes. And I was tickled to give it to him every year.

    Wish he were here now, so he could do it for our present property that we “just” bought, but I am going to do my best to follow this advise and do it myself, without his help.

  4. Mike Miller

    Protest the value of your commercial property annually. Yes, protest each and every year. Even if the value did not change, protest the value. The assessor’s values are based on the cost approach, the least reliable method of appraisal. You can protest both excessive value and unequal value each year.

    1. I filed an appeal for my 2021 tax bill and finally got a hearing date to prep for ( I’m in SF). I bought in Feb 2020 before the world flipped upside down so as of Jan 2021, I’m trying to prove it declined since my purchase. Aside from providing sales comps for that period, do you have any other tips to share as I walk into the hearing? Not sure how it’s changed since your experience 10 yrs ago

      1. I’ve filed an appeal as well and am still waiting for my hearing date! Bought in 2019. However… based on the comps and online estimates… the property has appreciated by ~30%, so I probably have no shot.

        Comps are your friend.

    2. This post is interesting. I’ve often wanted to appeal our tax increases (we’re in NOVA), but my husband doesn’t want to bother with it. I may look into hiring someone as you mentioned- great tip. I’m also wondering how much our property taxes will increase if we finish our basement. I’d like to put the money into our house, but this will increase the value and the taxes.

  5. Sarah Smith

    It’s crazy to me that they assessed your property for over $100,000 more just to get more taxes out of you! I wonder if I could get a good result on lowering my own property taxes by hiring an attorney. It would be great to have a little more money to invest in my Roth IRA or even to put toward a vacation with the kids.

  6. Great article.

    Oddly, I have a problem quite different than most here. I have a small one family house in upstate New York that I bought two years ago for $43,000 (needed work). It’s only assessed at $60,000, yet my taxes (school and property combined) are currently $3200 a year and they go up $200 every year. None of the houses in the area sell for over $150K.

    How can I fight this? I went to the assessor last year and he basically laughed in my face and said “do you want me to assess it LOWER?” and, when I asked him why most of my neighbors were paying less than half of what I paid he said, “well, SOMEONE has to pay taxes” + “a lot of them are really old.” (I guess referring to their eligibility for the STAR program, but I didn’t find it amusing.)

    I think I read once about a 2% rule in regards to taxes (if someone could clarify?), and that would mean I should only be paying $1200/year.

    Any insight, please?

  7. Platinum Accounting

    The extra charges of a government on the purchasing of property in the form of general country tax can be eliminate easily with in a seven days according to the rules and regulations of a government,If you write an application with the authentic reasons for a elimination of property tax and also attached a legal documents of a property tax pairs after that submitted in the government office by the tax layers which is helpful for you to approved the claim of your property tax in the seven days without any allegations of a government on the application of your property tax ,Remember don’t write any irreverent reasons in the applications of property tax you want to submit in the office of government and also don’t attached any illegal or extra document of property which increase the chances to refuse or neglect your claim application ,So keep it in your mind all the instructions and requirements given to you by the tax layer after concerning this kind of matter according to the current policy of government .

  8. I live in Los Angeles and my property tax went down 1% during the bank mortgage fiasco housing bust in 2010-2011, increased only 1% in the 2011-2012 tax year and stayed the same, (no 2% increase), during the 2014-15 tax year. I’ve had the normal 2% every other year except when I put in a swimming pool, 7% increase that year. Two years ago I put in a 400 sq foot pool house and there was no tax assessment increase at all. Very odd. I’m certainly not going to complain. What really pisses me off are all the “Bond issues” that are passed by the LA voters that have added an additional $2000 to my normal tax bill. What renter’s don’t seem to realize is that even if they are not paying property taxes, their landlords are. And what do they think is going to happen to that increase? The landlord will smile and say “oh well the cost of doing business” or “rents are going to increase folks!” Renters need to get a clue.

  9. Yesterday I found out the LA county assessor has been assessing our property for more than what I have bought or market value price for the last six years. As a matter of fact, in 2012 since the property value had dropped significantly, basically half of what we had purchased it for, we were able to refinance due to being under the water. One might think if you house is almost worth 50% of what you have paid for, the taxes will go down, but no. The county assessor assessed the property $150,000 more than the purchased prices back in 2005. Speaking of screwing homeowners!
    The reason for reaching out to you is that I would like to see if I could appeal for the assessed values of my property for the last six years.
    When I contacted the assessor yesterday and questioned him of how could he assessed the property that has depreciated so much, he was just mumbling. It is a shame that people would loose their souls for money and not doing their job. I asked him, how would he feel if someone was ripping him off.

    1. Our property taxes were re-assessed and they raised our taxes 41% – and it’s killing us. I get our house cost a lot when we bought it, but with the downturn in the economy we are still so under valued that a sale of our property at this point is still a short sale. We almost lost it in foreclosure like 9,000,000 other people but we fought to keep it and save our credit and the bank finally refinanced our loan. It was a 4 year battle that almost cost us our marriage. Our life savings is in this house. Our income still is not where it was when we bought it. We went from a $1.8 valuation in property taxes on our house to a $2.7 – a $900,000 increase in our property taxes. We are paying higher property taxes than ANY house on our street and in the next tract. I have appealed and they lowered it from the 2016-2017 roll to $2.49 but for the 2017-2018 tax roll, raised it back to $2.7mil valuation. This is $2300 a MONTH in property taxes up from $1583. I don’t know what to do. I have filed an appeal but have not had the hearing yet. We are at risk of loosing our house again just due to the property taxes. We have our own business so don’t say “oh you can afford it”. When we bought the home we were making 60% more a year. It’s been a tough road and we try to live otherwise debt free except for our home but its a huge struggle. We are in our 50’s and have very little savings. We have been waiting for the housing to come back so we could possibly put it on the market and get out but we still are not there yet. Every company that I have inquired about helping us wants whatever our savings would be if they get the property taxes reduced, which I can’t pay either? Help!





  10. Thanks a lot for the info Samurai. I was able to lower my house assessed value for 2017 :) so now what’s next? Do I need to do something else? Like contact the Revenue Department to make sure I pay less taxes this year? The first installment for my taxes is due in February and the second one in August. I know that for the first installment I paid 40% of my last year’s property taxes but I hope that for the second installment I should get a lowered property tax bill. I know this might be a silly question but I have to ask. What’s next and do I need to do something else?

    Thanks in Advance

  11. Assessor wants to come inside our house in order to lower our taxes!

    When we had our meeting with the tax assessor he wanted blue prints of our house and wanted to make an appointment to come inside. We got out our blue prints to calculate the square footage of our house and it was within 400 square feet of what the city had calculated which we felt was within acceptable error. I do not however want them in my house. I feel that if this is required of everyone to calculate property taxes that’s one thing but since it’s not then they are welcome to walk around the outside. Are they allowed to require this of people? We wrote a nice letter stating we’d accept their square footage but said nothing about allowing them to come in our house. It was hand delivered and we have heard nothing for 4 months. I’ve called and there has been no return. We received our new mortgage statement which includes our taxes and it is unchanged. We pay more taxes than all of the other houses on our block and it is not the largest and does not have more land. We pointed this our to the assessor and he said they calculate square footage differently depending if it is above grade or not no matter if it’s finished. He did acknowelege we pay more for our land than anyone else. Not sure what to do now!

    1. Wow! Jackpot! Just make sure he is who he says he is and check his ID and verify employment. Don’t want a stranger coming in.

      I’ve had assessors come into my house to measure and stuff every time I’ve refinanced my mortgage. Not a problem.

      If you haven’t checked the latest mortgage rates online and refinanced within the past year, I definitely suggest you do. Check out LendingTree Mortgage to start where banks send you competing bids. After Brexit, rates collapsed. But it seems like another rate hike by end of 2016 is on its way again w/ the latest move in the 10-year bond yield.

      1. I think she was talking about the county tax assessor wanting to come into her house not a mortgage loan assessor. I’ve never heard of that before and I wouldn’t want the tax assessor coming into my house either.

  12. Awesome post. I’ve been reading your blog for a while, first time commenting.

    From everything I’ve read here, you say that filing the appeal is a no-brainer. But is that always the case?

    I bought my home in 2013 in South San Francisco (falls under San Mateo county) for 700K, and all my property taxes have been based on that value ever since.

    My question is:
    1. Does it make sense to file an appeal, and can my assessed value go LOWER than my purchase price? (from what I can see, the market has gone up slightly since then, though I was able to find 3 homes that sold in the 150-300K range — way below market, in the south san francisco area)
    2. If I file the appeal form, is there a risk of that triggering a “re-evaluation” of my property, and that my property taxes actually INCREASE, when I filed to appeal to have them lowered?

    Overall, I am trying to answer a simple question for myself, is it worth doing the appeal?

    1. Hi Kunal,

      Yes, I’ve gotten my assessed value below what I paid for my house during the recession for three years in a row. I cherry picked comps and they were forced to lower.

      But since you bought in 2013, your value should be higher two years later, so it may be tough. Depends on how many comps you can find that show lower. If you can find 3, go for it. I don’t think filing an appeal will trigger an increase.


      1. I agree with the blog’s host, S.

        California’s June 6th, 1978 Prop 13 set the stage for some comparatively interesting property tax issues. Though your statutes differ vastly from most states we assist homeowners, you do have some quasi advantages.

        Basically, if you can establish via direct (solid comparable sales) market evidence that you paid more than market value for your property, you can establish a case for filing for a property tax abatement.

        Best of luck, and kudos to Financial Samurai for providing such a helpful website!

  13. Pingback: The Property Assessor Always Win In A Bull Market | Financial Samurai

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  15. Extremely interesting, and of course well written, piece. Kudos to the “Financial Samurai” for providing some great advice.

    One additional property tax appraisal issue I spent a decade working through (patent pending…explains the better part of the above-mentioned decade) is the tax appraisers’ consistent error, which creates disproportionality against owner-occupied, single-family, detached properties. As if this methodical error was bad enough, they carry it through in their ratio analyses.

    Approximately 98% of all 1 FAM D properties are illegally appraised (excluding CA properties due to Prop 13) resulting an average of 7%-10% over taxation. The appraisers rely on property sales in which the sale prices do not reflect the conditions of the properties at the time they sold!

  16. I bought my house a few years ago in eastern pa. My houses assessed value is $44,200. My property tax bills are about $4,500. More then half of that is to the school taxes. No wonder why the house prices in my neighborhood are so low- if they go up the taxes will be over the roof. I think this is ridiculous because I moved from a house in a different part of PA assessed at $180,000 and I only paid approximately $6,000 in taxes. Also what gets me is the previous owners had completed the basement and not pulled the permits. It became my responsibility and the city was after me for getting them. I complied and thought everything was fine. I paid for all the inspections. One day the county assessor came to my door out of the blue. Walked around the basement. To my relief there was no heat down there so it couldn’t be assessed. But oh, he saw my home had central air conditioning so he had to add that on. My tax bills went up $250 a year /: every home on my block has air conditioning and has had it since the houses were built in 2000. We are talking just normal 3 bedroom 2 story square block houses with a back yard as a hill.

    I honestly don’t see myself staying in this location just because of the property taxes. I can afford more as long as the property taxes aren’t that outrageous.

    Oh and another thing that bugs me- the city has a commuter tax. You pay their tax as well if you don’t live in the city- and if you work out of the city- you also have to pay .5% more. You can’t win.
    Easton pa is a very poor looking city in my opinion. The taxes really don’t help. I just saw a newer property in an -meh now just okay location- and I jumped on it. What a mistake.

  17. Have you ever been able to get out of the hearing? If you attended the hearing, how was it like?

  18. The property assessors office is just counting on people to forget or give up trying. And a lot of times they win. One employee told my mom “it’s not worth it to apply for a reduction” and my mom foolishly took that woman’s word for it and didn’t apply. I was banging my head on the wall when I found out. It takes hard work to save money but it’s worth it!

    1. Agree. Making money and SAVING money takes effort. 70,000 pages of tax code, 1 hour long hold times, and busy lines with 5 transfer options are there for a reason. To make a person GIVE UP.

      Never stop fighting.

  19. So how does this help you if you want to sell…and get the highest price for your property?
    Will LOWERING taxes affect the price you can command?

    1. It doesn’t. Selling and buying is based on market forces. If you drive a 1953 Porsche in immaculate condition and offer it for $1 on eBay, you will get whatever someone is willing to pay for it.

      Property tax administration and rates are based on artificial levels determined by politicians and voters who will happily take all your money if you can.

    2. Besides, property tax appraisals should NEVER be used as substitutes for more accurate fee appraisals. Additionally, if you consider the PITA, lower property taxes allows for higher mortgage payments, not the other way around. ;)

  20. “They [renters] will always vote to raise property taxes since they don’t have to pay for them.” Te he. The landlord simply rolls the prop tax and other expenses into the rent price. The renter is indirectly paying prop tax.

    FS – What do you mean that your assessed value was “reset”?

  21. FS, that is the price you pay for living in a *Superstar* city!:-) When your values are going up, up, up, the Assessor is going to take notice. Didn’t you recently list your house for $100,000 above market value? That shows up on Zillow; and no matter what the Assessor says, they do use and for information, if only for the pictures and Googlemapping.

    Anyway, most of the State of CA is still WAY below the highs of the mid-2000s values, and LA and Ventura Counties unilaterally reduced their values 20-30%. The County I live in, I walked in to the Assessor’s office, made a verbal request noted in the computer by the Clerk, and the reduction was granted (12.5% reduction) just this November. Things are still depressed (except in *Superstar cities*!). But I admire the ‘spirit of the warrior’, and if you can get your tax reduced that is fantastic.

    I did have a brutal experience in 1993 appealing my Redondo Beach home’s value (there were foreclosures everywhere, not unlike more recent times). I had to take a day off work, drive 30 miles, wait half-a-day while the Appeals panel heard each case. I made my case noting the Foreclosures; the panel chair stated “we con’t count foreclosures”. WTF? He said, “we can grant you $5,000 reduction ($51 off my bill), or you can take another day off work and come down and appeal at the next level.” He then turned his head away, cupped his ear, and mockingly waited for me to decide. Ugh! I pu$$ied out, and took the reduction, unwilling to take another day off work.

    Bottom line, the appeals process is good if you are unemployed, retired, or work nights. The Assessors get paid by the hour, and treat the property owners like they are also getting paid by the hour to wait, research, argue, and settle. The “two years” thing is interesting too; people die, divorce, lose jobs, move closer to family, etc. Sometimes the property owner is overtaken by events more pressing and has to sell; then, the Assessor’s protest becomes moot.

    Just curious, but would you say your house has a market value above the Assessed value? The initial Assessment is based on the purchase price, and with 20%/annual SF homeprice increases, you must be ahead of the game. How about your rental properties? Are they taxed at market value?

    1. Good point on listing. Yes, they used my higher listing as one excuse to raise. All I had to say was that I didn’t sell and the price was just a pie in the sky number!

      That’s a brutal Ventura County story. Thank goodness for the Internet now. War of attrition. A 2 year wait to win an appeal is redonkukous. No wonder so many folks don’t bother or just give up!

      The assessed value is always going to be higher than my perceived value as long as I own, because I think my properties are worth zero. Only when I plan to sell do I look for a market clearing price.

      1. FS: “assessed value is always going to be higher than my perceived value”

        That is really great, a ‘truth bullet’. I wish I had your site 20 years ago; the idea of “fairness” is something I wasted decades of life wondering on, and thinking it mattered. But it doesn’t. The bell never rings in the ‘school of life’.:-)

        btw, another ‘tip’ from your book “How To Engineer Your Layoff” also applies in Property Tax Appeals. Assessors and those who work there are people, too. A small consideration I showed to an Assessor in Ventura County, by making him look good in front of his boss (I mentioned that he had been professional and responsive when others had not) and it turned in to some reciprocity in another occasion (he permanently knocked $39K off my basis, or $410/yr). Also, the County in which I reside now, when I spoke with the Clerk (really just taking requests for angry, abusive idiots), I told her I really appreciated how well she handled the previous customer (who was ridiculously dramatic). I also was humble, told her I “blew it, and overpaid” for my house, which is true; she told me “that happens sometimes.” It was a small moment of mutual empathy; I’m sure that is what made my 12.5% reduction (more than I asked for) go through with nothing more than a verbal request. They are just trying to get through their day, and are people, too; they respond to respect and deference, just like I do.

        1. Your reduction had nothing to do with your charm or flattery. The market dictates what your house is worth, not the appraiser…
          Your putting in a nice word on the performance of an employee has no effect on the market value of your property. It goes in one ear and out the other. You would have gotten the same result if you had insulted that employee and said he/she was awful…

          1. Nah, Ed. It happened right there in the private meeting with the appraiser and his boss. The appraiser suggested that the small $39K reduction in value be made permanent, and his boss check the ‘permanent’ box.

            Your note ignores one fact: ‘the market’ isn’t anything more than a collective group of opinions based on disparate facts, and the opinion that means the most is the appraiser.

      2. One more thing, on the Redondo Beach (LA County) story…I followed all the written directions for the process, including sending in any documentation for my lower value. Having refinanced, I had an Appraisal which cost me $300 and showed the significantly lower comparables and value. The Assessor did not respond to my calls, so I had to show up at the cattle-call hearing. The Assessor used these cattle-calls (everybody came in and sat down, and spoke from their seat) as a tool to embarrass us; we had to argue our case in front of an audience, and he sliced us to ribbons. In my case, when I brought up my documentation which he had a copy of, it turned out the Assessor spent his time discrediting the comparables! I had shown my ‘hand’ first, as it were (according to the written Appeal instructions) and he used it against me! (there were foreclosures in the comparables). Ugh! Anyway, even though a professional appraiser and lender may take the appraised value as “fair”, as your posts aptly notes “fairness” is not what the Assessor is seeking.

        1. Very often, fee appraisers will lowball refi appraisals.
          Are they supposed to emulate the market? Yes.
          Are they supposed to have a number in mind before they start the process? No.
          Will they get any more work if the number they come up with does not please the end user? Absolutely no!

          USPAP and the CA Business & Professions Code lay out the way apprasiers are supposed to perform the work. The penalty for not conforming to the established best practices is a minimal fine and possibly a restriction on the license. It make more financial sense to do poor, unsupported appraisals because that guarantees more work. The penalties are so deminimus, that they are not even a consideration…

          1. Ed, now the above notes contradicts your previous statement that ‘the market dictates what your house is worth, not the appraiser…’ If your premise were correct, there would be no difference between the real estate appraiser and the County appraiser. And there would be no point in appealing a disagreeable value.

            Appraisals are far more art than science.

  22. Sam, based on your posts I am going to be soon buying a house in the East bay.

    Are you saying that the property tax increases by 2% annually (which is the max cap based on Prop 13)?
    Also for a new home purchase is the 1st year property based on the sale price or the appraised price (given that you need to overbid to get the needed house)?

  23. We have been in our current home since 1988. Purchased off the repo market, we slowly fixed it up and made it ours. I have only fought the assessor’s office once. Our local gov’t set up a provision years ago that your assessed value can’t increase by more than 3% per year unless there were permitted improvements done. Only once did they send out the new assessment going up over 8%. Surprising to me, it took a phone call. They claimed there was a ‘computer error’ and immediately set out a corrected assessment. Even after all this time we have continuously had our assessed value at less than the market value listed on Zillow. After reading many of the other post I am thankful to be living in North Florida.

    Since that one occurrence, the laws have changed. I expect the assessment to catch up with the true value within the next couple of years and then the games could begin.

  24. Assessors are worse than the country lords of old (actually, they’re pretty similar from a tax collection perspective). I recently had my house appraised for a refinance and the appraiser told me that the appraisals are typically coming in around 10-20% below the ASSESSED Tax rate. Seriously? WTH. I’ve tried to fight it in the past but have never had much luck with it.

        1. assuming your appraisal is done between the month of Oct to March otherwise it will not be considered by the assessors office. I tried to fight prop tax increase with the appraisal from a refinance and was told to have a nice day without any apology as the office only considers sold properties or appraisals done between Oct 1 and March 31 every year. At least that is how it is in california.

  25. Sunil - Extra Money Blog

    not all markets are as ruthless as SFO. several cities/counties in MI are automatically lowering assessed/equalized/taxable values much lower than market worth (based on comps and zillow). makes things a lot easier for those living there.

    I do agree with the process however as I’ve done the same in two other states. it takes time, but it works.

    1. Michigan seems more homeowner friendly. Although no Michigan tax collector can say with a straight face their economy is doing well when the auto industry almost went BK.

      It’s easier for SF to jack up rates given we’re in this bubble. But not everybody participates in a bubble, but SF is carte Blanche raise em up!

      1. Sunil - Extra Money Blog

        what is also critical in SFO vs MI comparison is the tenant vs owner occupied mix. the dynamics you wrote about play a big part.

          1. Overall the living is good in Michigan. I admit the winter months suck, but the rest of the year is pretty decent. I have lived in St. Louis and Houston. The summers there are brutal. The traffic is no where near as bad as the former cities, at least on the west coast of Michigan. Property is still reasonable but I do not expect that to last if the drought drags on. Its really a good time to buy in n Michigan. The snowbirds got the right idea, spend your winters in the south, summers in the north.

  26. I have been lucky so far, that my assessment has been right. In Los Angeles, they went around Prop. 13 by putting a measure to add to your utility bill a tax to fund trash and police. Now my utility bill has an additional $45 in taxes every other month for trash and police.

    BTW, the woman in the assessor’s office is wrong regarding renters and property taxes. As a landlord, I always passed on higher costs to my tenants. I think if the tenants realized that higher property taxes adds to their rent costs, they would feel differently.

      1. It is what we call business as usual. As a landlord, you try to recover your expenses like taxes. In fact, new landlords generally will raise rents to re-coop the price they paid and the higher taxes associated with the sale. You see this same thing when companies buy or merge companies. Airlines are raising prices because they can with less competition. At least with rents there is a limit, the market place.

  27. I think at least part of the problem is because of where you live. I’m just over the bridge in the East Bay and lowering my assessed value happened within 3 weeks of me sending in the paperwork, no questions asked. It lowered my assessed value by over 10%. Between this and the no-cost refi, we’re saving a lot each month. Most people in my city own and are middle-to-lower income, so I think there’s a lot of incentive to keep the costs down.

    Maybe you should consider moving? You’d save a lot of money… :) I guess that’s why retirees usually move. I’m considering it when I’m done.

    1. Most definitely considering. I’ve got a 2-3 year plan to move to a lower income tax state and just keep a pied de terre in San Francisco for when I want to visit. The planning will be fun and I’m excited!

      1. That sounds great. I’ve gotta hand it to you for sticking it out in SF for so long. To me, the “shine” wore off after about living there for 5 years and I was ready to go. So many irritations. And it seemed every third person I met was “on the dole” in some way or another. Many even admitted to gaming the system. I’ve always considered myself “left-leaning”, but that kind of garbage really got to me.

        Moving would be an adventure, but we are not ready to actually do it yet. And, there’s the question of where to move to. I did look at some numbers for a nice lakefront resort where my folks currently live. The cost turned out to be a wash, especially with all of the cost saving things we’ve done. And, since it’s a strongly retirement-oriented place, the average age there is late-60s, so we’d be hard-pressed to find a peer group. Still, I do predict some sort of move after FIRE. I think Vegas would be my first choice, but wifey is against desert living.

        1. Take a look at the Nevada side of Lake Tahoe. Some good property deals to be had and of course no state income taxes. I wouldn’t mind just renting a place there for residency as well to avoid property taxes.

  28. The First Million is the Hardest

    Other than the absurdly high property tax rates we pay in NYS my house is assessed pretty fairly. It’s below what I actually paid for the house, and well below what any recent sales around the neighborhood have been.

      1. The First Million is the Hardest

        It varies based on the county, but I’d say most are paying somewhere between 3-5% after the city and county get their slice of the pie.

  29. Appealing for a lower rate works for more than property taxes. In addition to lower property taxes, I have negotiated lower prices (or averted price increases) on the following:
    Car insurance- I simply called during the renewal period and told my insurer that a competing insurance company had offered me a lower price with more coverage. I asked for a review. When asked what competing rate was, i answered “Ive been with you a long time, just put your best foot forward” My insurer came back with a figure $50 lower.
    Home owners insurance- did the same thing and had it lowered.
    Cable TV/Internet bundle- got tired of the bi-annual rate increase. I called customer service and told them I felt it was no long a good value. My rate went from $80 eight years ago to over $100 today with no increase in service or quality. I could get Dish for less, i said. They put me in touch with their “retention department” who let me keep my rate for another year. When that year was up, I did it again and was granted the same rate. I’ll do it again.
    Lawn Service- lowered it to half during the winter months when they only have to cut the grass every other week.
    You’ll find you can keep more of your money by simply asking.

  30. I filed for the first time this year, fingers crossed. We have an online application that makes it a bit easier. Reminds me…it’s time to go check the status…

  31. While the apparent redistribution from homeowners to renters is egregious and insidious, property tax redistribution usually runs in the other direction.

    In many states (about half), rental property is taxed at higher rates than owner-occupied homes; in Michigan the school property tax rate on rental property is four times the rate on owner-occupied primary residences leading approximately to an extra $1,500 annual property tax on a typical rental house. The 5% cap on increases in “taxable value” – distinct from and usually well below “assessed value” – combined with shorter average holding periods for rental property, made taxable value on rental property 30% higher than on equivalent owner-occupied property by the end of the 1990s. (As is common with similar caps, taxable value is adjusted to current market value – marked to market? – upon sale; the shorter average holding period of rental property causes it to be adjusted to market value more frequently than owner-occupied homes.)

    I know several Michigan landlords who believe their assessors are using assessments to effect a modest redistribution from landlords to homeowners but I’ve never seen any actual study making that claim.

    And Sam here has proposed a renters’ tax on the ground that renters don’t pay property taxes – if that’s the case, why not raise property tax rates on rental property an additional four times over what homeowners pay?

    1. Terry, just so I understand, are you talking about the redistribution of wealth from landlords to primary homeowners with no rental properties? Eg landlords are subsidizing homeowners with one home they live in?

      I’ve never heard of rental property taxes being 5X higher than primary property taxes. Or are you saying the redistribution is to landlords from renters because landlords will just pass on the tax cost to their tenants?

  32. EXACTLY. A war of attrition is exactly what this is. It’s the same reason why the MAJORITY of FREE loan modifications that the big banks like Bank of America have been sending out since the US Justice Lawsuit last year have remained unopened b/c folks feel they have NO HOPE in ever winning or gaining benefits.

    Property assessors offices around the nation just hope folks don’t file appeals so they can get away with raising taxes no matter what housing market is doing. It’s particularly scary for those who live in mismanaged budget deficit states such as Illinois, New Jersey, and California.

  33. Jenny @ Frugal Guru Guide

    WOW! I got my property taxes lowered in my last house after my community built another water tank just over my back yard. It wasn’t anything like that, though.

    Winston is…naive? absurd? both? There is very little correlation to the amount of funding per school child and the quality of the education they receive. The glut in funding over the past 20 years as homeowners have been browbeaten to “do it for the CHILDREN” has gone to paying for an enormous ballooning administration, which has grown SIX times faster than enrollment.

    Where I grew up, per-pupil spending is fairly low. The schools are new or recently remodeled, and for the demographics, the area has great test scores. (One of the 90%+ below poverty line elementaries is a Blue Ribbon School, and they’re repeating the model on the other school in the district with similar demographics.)

    Around here, they spend 50% more per pupil, and the schools were all build in the 50s, 60s, and 70s and NEVER REMODELED. Some of them smell like mold when you walk in the door from the ceiling leaks. Almost none are ADA compliant. And every few years, the district pushes for a more money to “help.” The schools see almost none of it. The money stays firmly at the district level, feeding an ever growing number of administrators.

    No. I’m not happy with the school district, and I’m not going to happily pay whatever they want to pull out of my property because it’s “for the children.” It’s not for the children. It’s for the administration, and the children go hang.

    1. It is funny how propaganda always use “the children” as a way to convince all voters to raise homeowner’s property taxes. Well shoot, of course when 65-70% of the population doesn’t have to pay for property tax increases in San Francisco it’s fine.

      It’s the same thing with Prop 30 passing, and Prop 38 not passing. Prop 38 raises income taxes on everyone, so that EVERYONE pitches in to help our children by the tune of $10 billion a year. SHOT DOWN. Instead, Prop 30 passes where only those who make more than $250K a year pay higher income taxes and raises $4 billion LESS a year.

      Why can’t we ALL pitch in to help our children? Why do we have the power to raise another person’s taxes without having to pay more ourselves?

      1. Right on, Sam. If voters were really as altruistic as they may claim, prop 38 would have had no problem passing. Instead, it always sounds better to have someone else pick up the tab. Imagine if you could “vote” who paid at a bar? You could easily get enough votes to have someone else pick up the tab there too.

        1. It continues to perplex me why everybody doesn’t pitch in to raise 70% more money a year for the children’s if that’s what they want.

          I swear I would never have to pay a bar tab again if I had Chuck Liedel, Patrick Willis, The Undertaker, and The Hulk as part of my crew.

  34. The property tax valuation on my home stayed the same during the downturn, and I didn’t fight to reduce it. Why not? Because a large portion of it goes to fund our school district (where my son goes to school). As the son of a retired teacher, I understand what a huge impact funding has on the quality of education children get. That is why I will NEVER appeal a property tax hike. I don’t mind if all of my neighbors around me are paying less than me because they appealed their property tax valuation. I will willingly pay more school taxes if asked (realizing they are only a portion of the total tax bill).

    Now, I know that plenty of folks cry and moan because they don’t have kids and don’t feel that they should pay school taxes in the first place (or at least shouldn’t pay any more than they already do). What these people don’t realize (or don’t want to admit) is that our country as a whole benefits from a better educated society. A better-funded local school district actually benefits them, whether they see it or not.

    Oh darn, there’s my socialism showing again.

    1. Comrade, I would be fine too if I had kids in public schools.

      Your situation and my situation is different though. Doing the downturn, my assessed value kept on going UP by 1.5-2%, not flat or down. I don’t think you would be OK with your neighbors or folks in neighboring states pay less while you pay more.

      1. As I said, everyone benefits from more money in the public school system — not just people with children. Eventually children grow up and become contributing members of society. The better their education, the better their chances of making a positive contribution rather than a negative or neutral one.

        I’m fairly sure that my neighbors were paying less in property taxes during the downturn, because they told me they were appealing their values and getting them adjusted downward. I refused to do that. My assessed value remained flat. I WAS and am still okay with paying more.

        That being said, I agree that our situations are different. I only pay about $4k in property taxes per year on our $160k suburban home, while your taxes (I’m sure) are many times that amount given your locale and the expense associated with it. Plus, you have additional properties, etc.

        1. I understand the argument of children growing up to be contributing members of society as a benefit for everyone. Although, how can we be so sure everyone will be a boost rather than a drag? I don’t think we can convincingly argue either way, which is why it’s justified to take this argument out completely and focus on the dollars at hand.

          It’s not society and children. It’s money going from citizen’s pockets to politicians who promise one thing and do another. How else do you explain such HUGE state deficits and problems with our schools?

          Also, I’d love to get your thoughts on whether you are OK if I was able to vote to raise your taxes while I didn’t have to pay more myself. Thanks.

          1. John Sweeney

            I just wanted to say that while I believe 90% of the people in politics are there for the recognition and money and most tax money is siphoned off to corporations, education is the single most important deciding factor in keep young people from growing up to be a “drag” instead of a “boost”. Taxes are a scam, but community development and giving young people a sense of worth is the only way those kids won’t want to take what you have.

            The reason our “economy” is inefficient is because the only people we are worried about is ourselves and the majority of people smart enough to figure out the system are so caught up in the greed that they just become a product of the system who’s entire future would crumble if they started caring about the well-being of their neighbors.

        2. @Winston:*Eventually children grow up and become contributing members of society* Errmmmm…not really, especially with the broken public school systems. The highest expenditures per-pupil are in D.C. and St. Louis, which also has the highest ignorance-per-pupil.

          re: Prop 13 – in CA, this caps property tax increases at 2% per year, maximum. Most counties (LA, Ventura, etc.) unilaterally decreased the basis during the downturn(s). The real problem for schools in CA is Prop 98, which guarantees that 43% of the State budget be spent on K-12 public schools; this is true even in the years revenue increased 7% like the late ’90s. The State Education Dept. had to spend the money (they can’t carry over surpluses into future years), so they hired a bunch of administration, and mandated that K-3 have a 1/20 teacher/student ratio. When the go-go internet boomed cratered, the taxpayers were stuck with a bunch of uncredentialed teachers, school breakfast/lunch/dinner programs (90% of LAUSD students are on free lunch), etc. Then, take into account the Bond programs (Bond BB for K-12 in LAUSD was $3.2 billion to buy land and build new schools, when the student population is actually decreasing). Add in the Lotto (“our schools win, too!”) where 1/3 of Lottery revenue is earmarked for K-12 public education. Don’t forget 9% of the State budget that goes to higher education (UC, Cal State where 2/3 of the incoming freshmen need remedial English and Math courses).

          Bottom line, money isn’t the problem, and more taxes won’t fix a broken school system.

        3. @JayCeezy: Our own governor (Chris Christie), and our state legislators passed a 2% property tax cap law. There were plenty of localities that began using loopholes to increase property taxes before the law went into effect, and even after.
          With that said, my own locality isn’t trying to go past that allowed limit, and in fact have kept it below the cap since the law was put into place.

      2. @Sam — On the surface, it doesn’t seem fair for renters to be able to vote to raise taxes on property owners; however, it will still come around to affect them when the property owners raise rent due to higher property taxes. Are you not recapturing that additional cost by raising the rent you charge for your properties? Or does SF have some sort of rent control rule? I’m not really sure of how that sort of system works, since we don’t have that here in Houston.

        1. Many large cities like SF and Manhattan have rent control rules. Some onerous, some more generous like 10% max increase with 30 day notice and up to 60% increase with 60 day notice.

          Most large resets/jumps occur after a tenant moves out. Some tenants never move out so one has to be vigilant.

          Bottom line, there is asymmetric power.

          1. Margarita Burk

            Dear Samurai, my assessor asking me to bring mine and my co-owner tax returns as a prove of continuous ownership 50/50 since 2012, when I granted my co-owner my half to obtain better refinance terms. He immediately deeded my half back to me after refinance completion.
            I did not recorded the deed until 2015, which triggered re-assessment of my “newly acquired” 50 % of ownership, even though the change of ownership form was filled with the “refinance only” transfer box marked correctly.
            The assessor ownership division refused look at my Unrecorded Deed. Instead, they want mine and my co-cosigner tax returns. Do they have right to ask for my and someone else income/loss filed with IRS? Is there a law protecting us from government snooping our private information? which I can look up? it is ownership change, not income producing case, after all.
            Any ideas, advise?

  35. Even though I don’t own a house, this still might help me in the future when I do own my own house! I never knew that property taxes could be that high (I’m from the Midwest so it might be slightly lower here).

  36. Are you sure it’s the assessor’s office you’re supposed to be calling? Here there are two distinct offices – the property appraisal office that determines the taxable value of your house, and the assessor’s office that determines the millage rates that will be applied to everyone and collects the taxes. They are completely independent offices, so calling the assessor would do you no good when you want to challenge your taxable valuation.
    We have example spreadsheets that we used for our Value Adjustment Board Hearing (pseudo-court for challenging property appraisals) in this post if anyone is curious how they might set it up for a winning challenge.

  37. Money Beagle

    I’ve actually never filed an appeal because for the 10 years or so that I’ve owned property, the valuation has always been within a reasonable amount of what it would actually market for. There was one year I thought the city would raise the value when I knew the value had started to decline, but they actually lowered the value.

    It helps that in Michigan, there is a cap of either 5% or the rate of inflation, and even if they assess your value by a percentage higher, they can only increase based on the lower of the two items above. So, even if they deem that the value goes from $200,000 to $250,000 in a year, the maximum they’ll be able to collect on is $210,000, usually lower if inflation is lower. Once the property is sold, the cap is removed. Most of the ‘difference’ was lost during the recent crash, but for many years, it worked out well for a lot of people.

    1. Sounds a lot like California. Our taxes are based on the purchase price (Prop 13). But the thing is, even if an atomic bomb hits our great state, the assessors office will raise our property taxes by a certain index usually tied to inflation ~1.5%-2% every year, without question.

      In my case, they reset me back to original value and then tacked on another 1.8%. Devastating.

      1. We have a 3% cap since the 90s(?). The assessed value are usually below the real price because the 3% cap couldn’t keep up with the property appreciation. That’s why we still see 3% increase every year.
        I appealed a couple of years ago and was rejected, but the following year our tax went down a bunch. Not really sure why, but I’m not going to complain at this point.

  38. Ugh. We have wen’t round and round with our assessor for years. They were charging us at a rate of over $25,000 more than we paid for the house…immediately after we bought it. This year, there was finally a correction, thank goodness.

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