How Property Taxes Are Calculated In California

Posted on April 22, 2011 by Connie Miller 
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How Property Taxes in Santa Clara County Are Calculated

For those of you new to the area, California’s property taxes are driven by the 1978 passage of Proposition 13.  Proposition 13 was the voter’s response to what was felt to be property taxes spiraling out of control.  Prior to Proposition 13, the worst stories of government over taxing were told by elderly home owners on fixed incomes, who were forced out of their homes because they could not afford to pay the unpredictable, and large increases in their property taxes.  Basically, what Proposition 13 does is both restrict the tax rate and the rate of its increase over time.  It stipulates that the tax rate cannot exceed 1 percent of a property’s value plus special local bonds and assessments.  Further, as the value of property increases, the tax can never go up more than 2% a year.  The exception to this last rule is if there is new construction or the house changes ownership, when the sale price becomes the basis of the tax assessment. 

 

For estimating purposes, I suggest people use a number of 1.2% to conservatively estimate their annual tax for any house they are considering purchasing.  Most areas in Santa Clara County have a property tax rate of 1.1% when you average in all of the local assessments.  For more information on property taxes, please visit www.scctax.org.

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