Average Property Tax In California

What Is Property Tax?

Property tax is something all home, building, and land owners must pay. It is in addition to income tax and applies to any person or company that owns real property. Property includes land, private homes (including houses and apartments), businesses, and factories. 

This also covers mines, minerals, quarries, and anything found within the land. Essentially any piece of existing land or any building and everything attached to and within it is subject to property tax in California.

Average Property Tax In California

Computing property tax averages is difficult. While the law outlines how property tax needs to be calculated, the actual average will differ as it depends on the average value of properties within the state. To look at it in simple terms, the current average in California sits at 0.73%. 

This means that for every dollar worth of real property you own, you will be required to pay approximately .07 cents in property tax. You need to be aware that this average changes frequently and may not remain current for long.

California Compared To Other States

Some people may be of the opinion that this is high. But it is important to consider how California compares to other states. Rhode Island, for example, currently has an average of 1.53% which is more than double California’s. Likewise, there are several other states that see much higher property tax averages. 

This is for a variety of reasons, given that each state differs on multiple contributing factors. The most helpful way to compare California’s property tax is to look at the national average. Now in the USA, the national property tax average is 1.07%. Comparatively, California has a below-average property tax.

How To Calculate Property Tax

Property tax calculations start with valuation. It is important to note that in California, property taxes are based on the assessed value of the real property. The assessed value differs from purchase price and fair market value. Property is typically assessed every one to five years so the state can calculate the correct property tax amount. 

Once the assessed value is known, it is then multiplied by the current tax rate to get the property tax amount. As the tax amount changes over time, so too will property tax. This is the reason assessments are regularly done on our properties—to ensure the correct property tax amount is being charged.

Can You Reduce Property Taxes?

Tax rates are fixed, so this is not something you can dispute or seek to change. However, you can file a tax appeal if you feel that your property’s value was incorrectly assessed. 

If you believe that the assessed value is too high, this could mean you are paying more property tax than you should. It is sometimes worth getting a second valuation done to check that the first one was accurate if you think it may be incorrect. 

Summary

Nobody likes paying tax, but it is a necessary part of life. Hopefully this article has helped you to gain a stronger understanding of how property tax works in California. Staying informed with experts and trusted house buyers in California can help you make smarter decisions for your home.. While averages are important to know, your focus should be more on the value of your own property. 

You may end up paying higher than the average if your real property has a higher assessed value. It is a good practice to know your property and what it is worth in order to ensure that you are being taxed correctly.

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