Reduce Mellow-Roos Property Taxes
When Proposition 13 passed in 1978, it severely limited the ability of local governments to use property taxes to construct public facilities and services. As a result, California Residents were forced to discover different methods to finance public facilities in their neighborhoods such as streets, schools, parks, etc. The Mello-Roos Community Facilities Act of 1982 was enacted by the State legislature, the Act enabled Community Facilities Districts (CFD’s) to be put into place by local government agencies as a way of getting this critical community funding.
The amount of Mellow-Roos Property Taxes changes from one CFD to another. Typically, an accepted method that pertains to the size of the residence (square footage or parcel size) is used to determine the quantity of an individual assessment. Generally, the special property taxes and assessments do not go above 1% to 1.5% of the market value of new homes. In Addition to, the complete amount of all annual property taxes usually does not exceed 2% to 2.5% of the homes taxable property base value. So if you are able to lower your taxable base value or in other words, your propety tax you will save a substantial amount of money if you have Mellow-Roos Taxes on your home because of the increased percentage in property taxes you pay.
In California thousands of taxpayers in many urban areas have lost in excess of $200,000 in market value on their houses and paying 1.25% in property taxes they will save at least $2,500 per year for every year they keep their residence! Yet, that same homeowner at a 2% property tax rate because of Mellow-Roos taxes will save over $4,000 every year in property taxes! If you are paying Mellow-Roos and have lost $200,000 since you bought your home and let’s say you plan to own your home for the next 10 years, you will save $40,000! Don’t settle for Proposition 8 the temporary decline in property taxes, its only temporary. Learning to PERMANENTLY lower your taxable base value in California is the key to saving thousands over the course of your home ownership which is disclosed in the California Little Black Book.
Most often Mellow-Roos Property Taxes are applicable to newly built communities such as large scale Planned Unit Developments (PUD) where there have been many new houses built at once and the property taxes are necessary to establish city services. Ive seen Planned Unit Developments that had more than 5,000 homes built! So, the county and city municipalities need to scramble for funds to build the roads, sewage systems, schools, recreation centers, parks and so much more. Prior to buying a residence with Mellow-Roos property taxes you will be notified in the beginning negotiation stages of acquiring the house and while in escrow that these property taxes apply. You will never be blind sighted by Mellow-Roos Taxes, it is required that you are informed prior to purchasing.
About the Author: Valerie Faltas, Property Tax Expert has been involved in all facets of real estate for over ten years including assessments, appraisals, estates and trusts, investing and much more. She is a Certified Property Tax Appraiser, Licensed Residential Appraiser and a member of the International Association of Assessment Officers. As a real estate investor and advisor she is well versed in all aspects of real estate. To contact Valerie Faltas go to her website: www.propertytaxlittleblackbook.com.
