California property tax rates and how they work

California's property tax rate is 1% of your home's assessed value, plus any local voter-approved bonds or assessments. That 1% is set by state law and does not vary by county. What does vary is the assessed value itself — the county assessor determines this, and it follows a specific formula that most homeowners misunderstand.

The assessed value is not your home's market value. Instead, it is the purchase price you paid, adjusted upward by a maximum of 2% per year, regardless of how much your home is actually worth. This means a home bought for $500,000 in 2010 might be worth $1.2 million today but still have an assessed value around $610,000. When you sell or refinance, the assessed value resets to the new purchase price or appraised value, whichever is higher.

On top of the 1% base rate, most counties add local assessments. These are typically bonds for schools, fire districts, or infrastructure, and they appear as separate line items on your property tax bill. The total can range from 1.1% to 1.6% of assessed value depending on where you live and what local measures have passed.

Key Takeaways

  • California's base property tax rate is 1% of assessed value, set statewide, but your total bill includes local assessments that vary by county and district.
  • Assessed value is your purchase price plus up to 2% annual increases, not your home's current market value, so older homeowners often pay far less than newer buyers in the same neighborhood.
  • Your property tax bill resets to current market value when you buy, refinance, or transfer ownership, which can cause a sharp increase.
  • Homeowners over 55 can transfer their lower assessed value to a replacement home in the same county under Proposition 60, but you must meet strict timing and price requirements.
  • Calculating your exact bill requires knowing your county's local assessment rates, which you can find on your county assessor's website or your most recent tax bill.

How assessed value is determined and when it changes

When you purchase a home, the county assessor sets the assessed value at your purchase price. Each year after that, it can increase by up to 2%, compounded annually. If you bought for $400,000, the next year's assessed value could be as high as $408,000, then $416,160, and so on. The assessor does not need to reappraise your home every year — the 2% increase happens automatically unless the market drops significantly.

The assessed value resets to current market value in three situations: when you buy the home, when you refinance (in most cases), and when you transfer ownership to someone other than a spouse or direct descendant. A refinance triggers reassessment because the lender orders an appraisal, and the assessor uses that appraisal as the new basis. This is why refinancing can raise your property taxes even though you still own the same home.

If your home's market value drops sharply — such as during a recession — you can file for a reduction in assessed value. You must file a Proposition 8 claim with your county assessor, usually between July and November. The assessor will compare your home's value to recent sales of similar properties. If you win, your assessed value drops, and your taxes fall accordingly. However, when the market recovers, your assessed value can climb back up to the 2% annual increase formula.

Local assessments and bonds that add to your bill

The 1% base rate is only part of your bill. Most California counties add local assessments — these are charges approved by voters to fund schools, fire protection, water districts, and other services. A typical county might add 0.3% to 0.6% of assessed value, but some areas add more. Your total effective rate could be anywhere from 1.1% to 1.6% depending on where you live.

These assessments appear as separate line items on your property tax bill. Some are ad valorem assessments, meaning they are a percentage of your assessed value and rise with it. Others are fixed assessments, meaning they are a flat dollar amount per parcel that does not change year to year. A few are benefit assessments, which charge based on the size of your lot or the number of units on your property.

You can see all the assessments on your bill by looking at the detailed breakdown, usually on the back or in an attached schedule. If you want to know what assessments are in your area before you buy, contact your county assessor's office or search their website — most post assessment rates by neighborhood or zip code. This information matters because a home in one part of a county can have a significantly different total tax rate than an identical home a few miles away.

What happens to your taxes when you buy or refinance

When you purchase a home, your property taxes jump to reflect the current market price. If you buy a $900,000 home, your assessed value starts at $900,000, and your first-year bill will be roughly $9,000 to $14,400 depending on local assessments. The previous owner, who may have bought the same home for $300,000 twenty years ago, was paying only $3,000 to $4,800 per year. This is the most visible consequence of California's Proposition 13, which locked in low taxes for long-term owners.

Refinancing also triggers reassessment in most cases. When you refinance, the lender orders an appraisal. The assessor uses that appraisal to reset your assessed value, even though you did not sell the home. If your home has appreciated since you bought it, your taxes will rise. If you refinanced during a market downturn and the appraisal came in lower than your purchase price, your assessed value might drop — but this is rare and temporary, since the 2% annual increase resumes the next year.

A few refinances do not trigger reassessment: if you refinance with the same lender and do not take cash out, some lenders do not order a new appraisal, and the assessor may not learn about the refinance. However, you should not count on this. The safest assumption is that any refinance will reset your assessed value to the appraised value, which will raise your taxes if your home has appreciated.

Proposition 60 and the over-55 homeowner exemption

If you are 55 or older and own your home, you may be able to transfer your current assessed value to a replacement home under Proposition 60 (or Proposition 90 if you are moving to certain other counties). This means if you bought your current home for $300,000 and it is now worth $800,000, you can sell it, buy a replacement home for up to $800,000, and keep your assessed value at roughly $300,000 plus the 2% annual increases since purchase.

To use Proposition 60, you must meet strict requirements. You must be 55 or older at the time of purchase of the replacement home. The replacement home must be of equal or lesser value than the home you sold — if you sell for $800,000 and buy for $900,000, your assessed value will be reset to the higher amount. You must file a claim with the assessor within three years of the purchase of the replacement home. And you can use this exemption only once per person, though married couples can each use it once.

Proposition 60 is underused because many people do not know about it, and the rules are strict. If you are planning to move and you are over 55, contact your county assessor before you sell to confirm you meet the requirements and understand how the assessed value will transfer. The savings can be substantial — potentially thousands of dollars per year in property taxes.

Calculating your property tax bill

To estimate your property tax bill, you need three pieces of information: the assessed value, the base 1% rate, and the local assessment rates for your specific location. The formula is straightforward: (Assessed Value × 1%) + Local Assessments = Annual Property Tax.

If you own the home, your most recent property tax bill shows the assessed value and all local assessments. Multiply the assessed value by 1.01 to 1.016 (depending on your county) to get a rough estimate of next year's bill, accounting for the 2% maximum annual increase in assessed value. If you are buying a home, ask the seller's agent for a copy of the most recent tax bill, or contact the county assessor with the address and ask for the current assessed value and assessment rates.

County assessor websites vary in quality, but most allow you to search by address and view the assessed value and assessment breakdown. Some counties charge a small fee for detailed assessor information; others provide it free. If you cannot find the information online, call the assessor's office directly — they are required to provide this information to the public.

How your property taxes compare to other states

California's 1% base rate is one of the lowest in the nation. However, because homes in California are expensive, the dollar amount you pay is often high. A $600,000 home in California costs $6,000 per year in base property tax. The same home in Texas, with a rate around 1.8%, would cost $10,800 per year. But a $300,000 home in New Jersey, with a rate around 2.5%, would cost $7,500 per year.

The real advantage of California's rate is the Proposition 13 cap on annual increases. In most states, assessed value resets to market value every few years, so your taxes rise with the market. In California, your assessed value can only rise 2% per year, no matter how much your home appreciates. This means long-term California homeowners pay far less in property tax than they would in other states, while new buyers pay more than they would elsewhere.

Frequently Asked Questions

Can I lower my property taxes if my home's value dropped?

Yes, you can file a Proposition 8 claim with your county assessor if your home's market value has fallen below the assessed value. You must file between July and November, and you will need to show evidence of the lower value, such as recent comparable sales. If approved, your assessed value drops, and your taxes fall. The assessor's office can provide the claim form and instructions.

What happens to my property taxes if I inherit a home?

If you inherit a home from a parent or grandparent, the assessed value does not reset under California law — you keep the lower assessed value. However, if you inherit from anyone else, the assessed value resets to market value. If you inherit with siblings, each of you owns a percentage, and the assessed value still does not reset as long as the transfer is between parents and children or grandparents and grandchildren.

Do I have to pay property taxes if I own land but no building?

Yes, raw land is assessed and taxed the same way as improved property. The assessed value is based on the land's market value, and you pay 1% plus local assessments. If you own vacant land, you will receive a property tax bill each year. Some counties offer agricultural or open-space exemptions if the land is used for farming or conservation, but you must explore for these separately.

What if I disagree with the assessed value on my bill?

You can file a formal appeal with your county assessor's office, usually within 30 days of receiving your bill. You will need to provide evidence that the assessed value is too high — comparable sales, an independent appraisal, or documentation of damage or defects. The assessor will review your evidence and either uphold the value or reduce it. If you disagree with the assessor's decision, you can appeal to the county Assessment Appeals Board.

How often does the county reassess my home?

The county does not physically reassess your home every year. Instead, the assessed value increases automatically by up to 2% per year. A full reassessment happens only when you buy, refinance, or transfer ownership. The assessor may conduct a physical inspection if there is evidence of major improvements or damage, but routine reassessments are rare.