Following what has been an unpredictable and volatile year for the local real estate market, Los Angeles County Assessor Jeff Prang has announced that the 2023 Assessment Roll has increased by 5.91% over last year, marking 13 years of continuous growth.
The 2023 Assessment Roll’s growth translates to a record $1.997 trillion in total net value that will put about $20 billion in property tax dollars towards funding vital public services such as public education, first responders, and healthcare workers, as well as other County services.
The Assessor establishes the assessed value of all taxable property in Los Angeles County each year as required by the State Constitution. Those values are placed on a list called the Assessment Roll and reflect the lien date values on January 1, 2023.
The Roll, as such, provides insight into the state of the real estate market as well as the local economy and works as a valuable tool for local governments as they prepare their annual budgets in anticipation of property tax revenues.
“To say this has been a challenging couple of years is an understatement,” Assessor Prang said. “Our analysis does indicate property value growth at this time and that’s certainly good news for property owners and for local governments, which depend on property taxes to fund public services. However, the real estate market began more robustly in 2022 than it ended, and we will not be surprised if the sluggish market continues into the coming year.”
Although the housing market has cooled considerably compared to 2021, home median sales prices (MSP) remained strong, reaching a record high exceeding $900,000 while falling to about $865,000 in June. The continued strength of the single-family residential market through the first three quarters of 2022 produced a marked increase in property transfer assessments, which added $67.4 billion to the Assessment Roll.
The inflation adjustment mandated under Proposition 13 is the second most significant factor contributing to the Roll. This year the California Consumer Price Index trended well beyond the full 2% allowable. This resulted in a $36.7 billion increase to the 2023 Assessment Roll.
New construction added a moderate $5.6 billion to the 2023 assessment roll, while decline-in-value reductions and miscellaneous roll changes decreased the Roll by $2.5 billion.
Personal property and fixtures came in stronger than expected and added a record $10.4 billion to the 2023 Roll. Business sectors such as aerospace, motion picture, and retail, which were adversely impacted in recent years, saw robust growth this past year as consumers returned to the market.
However, the growth does not mean property owners will be subject to a corresponding increase on their annual property tax bills. Most property owners will see only a 2% adjustment prescribed by Proposition 13.
The 2023 Roll consists of 2,391,198 taxable real property parcels, 200,969 business property assessments, 33,871 boats, and 2,952 aircraft. A full list of assessment growth amounts and parcel counts for cities and unincorporated areas is available here.
Photo image by designer491