With the LA County Assessor’s Office declaring record highs in real estate tax receipts, the 2022 Assessment Roll brings a silver lining in the cloud of costly property prices in the south of California.
Current officeholder Jeff Prang reported his findings in which taxable properties in the area grew by $122 billion. On top of bringing the county’s net property value to $1.89 trillion, this opens an opportunity to provide local sectors like education, infrastructure, and the county’s essential workforce with $19 billion worth of help paying property taxes.
“I am pleased to report the 6.95% increase in assessed property values in Los Angeles County shows we are slowly emerging from the pandemic that has been with us for the past two years,” Prang told reporters.
Background
These latest details represent property values as assessed on the 1st of January 2022. Experts attribute this rise in property tax help to widespread real estate sales over the previous calendar year, estimated at over $69 billion.
The assessment roll also accounts for unsold properties, whose customer price index reached 2%, adding more than $32 billion to the tally. This impressive boost in value, according to the Office of the Assessor, is in spite of a recent plateau in the real estate industry’s profits, as Prang stated:
“Although the housing market is showing signs of leveling off now, it had been robust with low interest rates, inflation and a high demand during the COVID restrictions.”
The surveys that led to this report account for single family houses, apartment units, corporate properties, and real estate investments. This brings the roll’s property tax loan evaluation to cover nearly 2.6 million real estate units.
Properties inhabited by families made the bulk of this assessment, with roughly 1,889,000 homes surveyed. Prang highlighted the importance of these findings, saying “As I said when I released the May forecast, the growth in the single-family residential market was set to produce a record-breaking increase in transfer assessments and it did, adding $69.6 billion”.
With Good News Comes a Word of Caution!
Despite these promising developments, readers are cautioned that the rise in property tax help might be temporary given the market’s loss of momentum at the local and national level. Prang was quoted as saying:
“… lingering economic distress, the continued concerns of COVID-19 variants and evolving business trends have resulted in numerous challenges for the county. As always, however, we pulled together and have produced a thorough, accurate, and fair roll in a timely manner.” CoreLogic reported a peak of 20% in profits from year-on-year housing rates across the country, according to the most recent available estimates from May. A year from then, however, these gains are expected to peak at a mere 5.6% following market losses in Bremerton, Washington, Boise, and other territories.
The reason for such declines is reportedly related to the rise of property rates. Over a seven-month period starting from January 2022, the online real estate merchant Zillow noted a 64% increase in 30-year fixed rate loans in the state of California alone.
CoreLogic’s Selma Hepp noted, “Slowing home price growth reflects the dampening consequence of higher mortgage rates on housing demand, which was the intention."
She continued, “With monthly mortgage expenses up about 50% from only a few months ago, fewer buyers are now competing for continually limited inventory,” Hepp said.
Further Details
According to CoreLogic, growth in Greater Los Angeles rose by 17% in May of 2021, followed by what was an expected rise of an additional 5.4% over the upcoming 12 months.
In light of the assessment in help paying property taxes, the increase in house rates was persistently in double digits year-on-year for the 16th month nonstop, despite showing signs of slowing down from April to May.
In recent months, all 50 states and the District of Columbia reported yearly gains, including 13 states where growth exceeded 20%.
Sotheby’s International Realty estimated a year-on-year rise of 17% for Claremont property prices, with the median rate per unit clocking at $930,000. The duration for a home’s market availability is now 11 days, down 42%. This is despite the rise in listings, now up to 55 units.