Soaring home prices across Los Angeles County could push taxable property value this year past $2 trillion, a record.
L.A. County Assessor Jeff Prang said taxable property values are expected to rise 4.75 percent this year from 2023, breezing past $2 trillion in net total value, the Commercial Observer reported, citing a property forecast to the Board of Supervisors.
The forecast projects the expected growth rate for the county’s annual assessment roll, an inventory of taxable property. Local governments use the forecast for their budget proposals.
“Our analysis indicates that property values are going to grow for the 14th consecutive year, which is good news for property owners and for local governments because they rely on property taxes to pay for vital public services,” Prang said in a statement.
“However, sales volume declined significantly in 2023 and commercial properties, especially Downtown Los Angeles, have actually experienced huge declines in value.“
While average apartment rents are at all-time highs in L.A. County, multifamily real estate and most other asset classes have had significantly fewer trades after the first three months of last year, according to the Observer, as buyers responded to higher interest rates and inflation.
In the city of Los Angeles, an additional Measure ULA transfer tax has further discouraged real estate investment.
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Single-family home prices are at an all-time high, with the typical home valued at nearly $900,000, according to Prang’s report. Property sales are expected to be the largest contributors of assessment roll revenue, with more than $51 billion.
Prang also expects an increase of $6 billion in new construction revenue this year, with projects such as the $1 billion Intuit Dome, the new Inglewood home of the L.A. Clippers, adding “significant value.”
The assessor’s forecast also notes value in special use property types, estimating $400 million for major construction projects such as SoFi Stadium and YouTube Theater. At the same time, decline-in-value reductions will strip $2 billion from the assessment roll.
— Dana Bartholomew