Santa Clara County property value growth slows
The sizzling pace of assessed property values in Santa Clara County grew at a slower rate amid economic shocks unleashed by the coronavirus, the County Assessor’s Office reported Thursday.
The total assessment roll for properties in Santa Clara County for 2021 came in at $576.9 billion, according to the Assessor’s Office. That was 4.6% higher than the total assessment roll for 2020. But that increase was smaller than in recent years, this news organization’s analysis of the county reports shows.
The assessment roll in 2020 was approximately $551.5 billion, which was 6.9% higher than the prior year. And the 2019 total was about 6.8% higher than the $483 billion assessment roll value in 2018, figures supplied by the County Assessor’s Office show.
Despite the slower growth for the total assessment roll, the ultimate results were better than the dismal outlook county officials feared in mid-2020 when coronavirus-linked business shutdowns were in full swing.
“This time last year the nation appeared to be on the precipice of the worst economic crisis since the Great Depression, triggered by the Covid-19 pandemic,” Assessor Larry Stone said.
Instead of a collapse in real estate activity, investors have continued to gobble up commercial properties, housing prices are still rising and development activity persists.
“It’s wild to see how much is going on,” said David Ginsborg, the county’s Deputy Assessor. “Properties are being bought and home prices are going up.”
One major project that has dramatically increased property values is Google’s Bay View campus in Mountain View, according to the assessor.
“The pace of new construction was delayed somewhat, due to the uncertainty over the economic and business outlook during Covid,” the County Assessor’s Office stated. “A notable exception was construction on Google’s new Bay View campus which accounted for $720 million of the County’s total $6.69 billion in new construction.”
Despite uncertainties, the office property sector has held its own.
“The Silicon Valley office market has emerged relatively strong,” the Assessor’s Office said. “Major acquisitions of office and commercial buildings contributed to the overall growth in property assessments compared to the prior year.”
Homeowners have been able to benefit from a provision in property tax laws that has kept their assessments from rising. Proposition 13 normally limits increases in assessment to 2% a year.
But Prop. 13 also requires that assessments can only increase by the lesser of 2% or the annual increase in the California Consumer Price Index. For the current tax year, the California price index rose just 1%, which capped the increase.
“Homeowners are major beneficiaries of the hot residential market, taking advantage of the stunning appreciation in the market value of their homes, while their assessment increased only 1%,” Stone said.
Still, some property sectors have struggled due to the effects of the coronavirus on the economy.
“Many sectors such as hospitality, non-grocery brick-and-mortar retail, restaurants, and entertainment, all suffered financially,” the Assessor’s Office stated.