Last month the Los Angeles County Assessor released a statement that the real estate market had grown 3.7% in the last year. This growth means that Los Angeles will assess the collective group of property in Los Angeles – called the Assessment Roll – on a value of $1.76 trillion. And experts say the number could have gone much higher.
How Prop 19 helped keep the price tag down
Last year, Prop 19’s passage led to many changes to the tax code that some found onerous. However, one part of the law, working with prop 13 and 60, kept the wildly inflating costs of Los Angeles property under control.
The specific clause in those laws that restrained the high assessment was the clause allowing certain classes of people to transfer the value of their property to another property in the state. Those classes are the disabled, people over 55 and victims of wildfires. Additionally, Prop 13 limits how much a home’s value can increase from year to year.
How important is the “Assessment Roll.”
The value of the assessment roll is not necessarily something that a normal consumer or even a property owner would need to keep in mind. The assessment roll is simply the numerical basis of the county’s tax rate calculations. However, growth and stagnation at the macro level is a massive indicator for the real estate industry.
What the surging value of the assessment roll in Los Angeles tells us is unclear. While it absolutely indicates that California’s property market is rising, that is just one data point. It may take some time to fully analyze the ultimate effect of the rising prices on all markets.