High demand drives L.A. County property values up 6%
Photo | Sherwood CC
NORWALK – L.A. County property values increased 6.04%, the seventh consecutive year of growth for local real estate, according to statistics released by the L.A. County Assessor.
The gross value of all taxable property in L.A. County reached a record $1.474 trillion.
The increase in value “reflects the continuing strength of the real estate market and high demand for new multi-family residential properties in the Los Angeles County area,” said L.A. County Assessor Jeff Prang.
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The 2017 Assessment Roll contains the details of over 2,300,000 taxable real estate parcels, 170,000 business/personal property assessments, 26,000 boats, and 3,000 aircraft.
As a means of providing tax relief to small business owners, Prang initiated a change to the Low-Value Ordinance by increasing the threshold from $2,000 to $5,000.
The change provides property tax relief to more than 50,000 small businesses by relieving them of a property tax obligation for equipment, machinery, office furnishings, and even some boats and aircraft that have an assessed value below $5,000.
Transfers of ownership, such as real estate sales, caused the greatest increase in the growth of the Assessment Roll at 3.13%. Additional factors of growth include decline-in-value restorations (0.38%) and new construction (0.55%).
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Decline-in-Value restorations include properties in areas still recovering from the property value downfall of the economic recession.
The annual inflation-adjusted trend, which is responsible for the increase in property taxes for properties that did not experience any form of changes in ownership or construction, added an additional 1.77% to the value of the Roll. This is consistent with Proposition 13 requirements, which limit increases to a property’s base value to 2% a year – or less if the California CPI is less than 2%.
From 2007 through 2010, the economic recession caused a decline in real estate values resulting in diminishing assessment roll values. However, between 2011 and 2016, an improving economy and a thriving real estate market in the County of Los Angeles resulted in consecutive increases in the Assessment Roll of 1.36%, 2.20%, 4.66%, 5.47%, 6.13%, and 5.58%, respectively.
With a growth of 6.04%, the 2017 Assessment Roll continues on this upward trend and illustrates strong market recovery, Prang said.