Proposition 8 / Reduction of Assessed Property Value for Tax Purposes application

GREGORY J. SMITH
SAN DIEGO COUNTY ASSESSOR
1600 PACIFIC HIGHWAY, ROOM 103
SAN DIEGO, CALIFORNIA 92101-2480
TELEPHONE (858) 505-6262
TEMPORARY REDUCTION OF ASSESSED VALUE FOR PROPERTY TAX PURPOSES
(Section 51(a), Revenue and Taxation Code - Proposition 8)


Proposition 8 (which was passed by the voters in June, 1979) allows a temporary reduction in
property tax assessments. Basically this proposition states that if the market value on January
1 of any current year falls below the assessed value (as shown on your property tax bill), the
Assessor’s Office must temporarily lower the assessment to reflect market conditions.

In practical terms, and with the history of real estate appreciation, most assessed values in San
Diego County are well below market value. Normally, only recently purchased properties that
have subsequently declined in value may be eligible for this temporary reduction in value under
Proposition 8.

Property owners who believe that the market value of their property is less than their current
assessment should contact the Assessor’s Office for a review. If supported by a decline in recent
sale prices, the assessed valuation will be lowered to reflect current market conditions.

The Assessor’s Office will then review the subject property on an annual basis each
January 1st. When the market has "turned around" and the value has increased, the assessment
of the property will also be increased (plus the annual 2% inflation factor mandated by
Proposition 13). Under no circumstances, however, can this increase in value exceed the
original assessed value (plus the 2% inflationary factor compounded).

In conclusion, Proposition 8 allows the Assessor’s Office to provide necessary relief to owners
whose property values have declined, while still retaining the ability to review and increase those
values when market conditions improve. For additional information, please call the Assessor’s
Office at (858) 505-6262.
GREGORY J. SMITH
SAN DIEGO COUNTY ASSESSOR
1600 PACIFIC HIGHWAY, ROOM 103
SAN DIEGO CALIFORNIA 92101-2480
TELEPHONE (858) 505-6262

APPLICATION FOR REVIEW OF ASSESSMENT
Under State law, (Proposition 8), if the current market value of your property falls below the assessed or taxable value as shown on your tax bill, the Assessor’s Office is required to temporarily lower the assessment.

This type of property tax relief generally applies to more recently purchased properties. If you feel you qualify for this reduction, please file this form with the Assessor’s Office between Jan. 1st and June 1st . Please indicate your opinion of value by providing supporting documentation, such as sales of comparable properties or a recent appraisal.

Our staff will review your application, and notify you of the results in July. If you disagree with the value at that time, you must file an assessment appeal with the Clerk of the Assessment Appeals Board between July 2nd and November 30th. The necessary application can be obtained by calling the Clerk’s Office at (619) 531-5777.

Owner: _____________________________________ Parcel Number: ___________________________________
Mailing Address: _____________________________ Address of Property: ______________________________
_____________________________ _______________________________
Value on Current Assessment Roll: ___________________
Owner’s Opinion of Market Value: ___________________
Comparables to Support Owner’s Opinion of Value:
PARCEL NUMBER
ADDRESS
SALE DATE
SALE PRICE
SIZE
REMARKS: _____________________________________________________________________________________________
________________________________________________________________________________________________________
________________________________________________________________________________________________________
Signature _______________________________________ Date ____________ Telephone __________________
Agent - Michael Gauthier / RE/MAX Associates
Agent Mailing Address:
5005 Texas St. #400
San Diego, CA 92108
Direct - 619-203-2860
E-Mail -mailto:-michaelgauthierrealtor@hotmail.com
VALREV1 (11/04)

Mortgage Tax Relief Bill San Diego

President Bush signed legislation today that will protect struggling homeowners from being hit by taxes tied to mortgage debt that has been forgiven by a bank or lender.

The so-called Mortgage Forgiveness Debt Relief Act of 2007, or bill HR 3648, amends current law that requires homeowners to treat forgiven mortgage debt as taxable income.

“Today’s bill will ensure that any debt forgiven on a mortgage secured for a principal residence will not be taxed. This is very significant legislation. This may also mean that some day in the future these families can once again achieve the dream of homeownership,” Bush said.

The measure offers a tax break to homeowners who have some portion of their mortgage debt forgiven through foreclosure or as a result of a loan renegotiation.

It provides a three-year exclusion for discharges of up to $2 million in debt and is expected to reduce the taxes of strapped homeowners nationwide by $650 million.

“When you’re worried about making your payments, higher taxes are the last thing you need to worry about,” Bush said during the bill-signing ceremony.

“This is going to make a happy holiday for many homeowners,” Bush said of the bill just before signing it into law.

In addition, the bill extends a tax provision that allows homeowners to deduct the cost of mortgage insurance premiums from their federal income tax returns until 2010.


Feel Free to call us with any questions you may have or you are in need of our services at
619-203-2860
michaelgauthierrealtor@hotmail.com

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Foreclosures countywide jumped 80% in August
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By Emmet Pierce There were nearly 4900 San Diego County foreclosure filings in August, an 80 percent increase from the previous month and the first of

Panel urges fight on foreclosures

Land bank to buy lost homes in county part of proposals

By Emmet Pierce
UNION-TRIBUNE STAFF WRITER


Responding to the spike in home foreclosures that threatens many of the region's neighborhoods, the San Diego City-County Reinvestment Task Force yesterday forwarded a series of sweeping recommendations to the City Council and the county Board of Supervisors.
Among them is a proposal to create a regional land bank to buy foreclosed properties and to prevent neighborhood blight. The homes then could be turned around to create affordable buying opportunities.

The panel also called for boosting government funding to nonprofit groups that counsel people facing foreclosure.

“This is a critical issue for our communities,” said San Diego City Councilman Tony Young, co-chairman of the task force. “The proliferation of subprime loans and the increase of foreclosed properties represent a threat to the qualify of life of our neighborhoods.”

Earlier this week, Irvine-based RealtyTrac reported that the county had 4,845 foreclosure filings in August, a year-over-year increase of 247 percent and an 80 percent increase over the previous month. RealtyTrac anticipates several waves of mortgage failures over the next 15 months as adjustable subprime mortgages reset at higher interest rates.

“We need to be concerned about the economic well-being of our residents due to the fact that this crisis severely impacts the very soul and existence of our citizens,” Young said.

He noted that recent studies have found that neighborhoods with large minority populations have been hit especially hard by foreclosures, many resulting from risky subprime loans.
The task force monitors the investments of financial institutions in low-and moderate-income communities.

Alan Fisher, executive director of the nonprofit California Reinvestment Coalition, which advocates for low-income communities, said the San Diego County task force is the only public-private body in the state that is actively addressing problems created by the subprime loan crisis.

In part, the task force's recommendations called on the city and county to:
Work with nonprofits to negotiate for reasonable loan workout programs with major lenders.
Lobby for stricter standards of ethics and disclosure for mortgage brokers and lenders.
Urge authorities to investigate securities fraud in the possible targeting of subprime loans to low-income and ethnic neighborhoods.

Develop city and county ordinances that will encourage the owners of foreclosed properties to better maintain them.

Pursue legislation to expand the lending capacity of the Federal Housing Administration and the Veterans Administration.

Boost government funding to nonprofits that counsel people going through foreclosure.
Form a regional land bank to buy foreclosed properties to create affordable buying opportunities while guarding against neighborhood blight. Purchased homes could be rented at affordable rates and later sold at affordable prices.

The recommendations were unanimously accepted by the panel and referred to the city and county. County Supervisor Ron Roberts, who co-chairs the task force, was not present.
“Predatory lending practices have not only had a disastrous impact on homeowners, but the proliferation of vacant and neglected properties is beginning to blight our communities,” Roberts later said in a statement. “Hopefully, some of these new measures will yield positive results.”
Task force member Robert F. Adelizzi, a retired banker, chairs the subcommittee that drafted the recommendations. He said a regional land bank could be created in a number of ways.
Adelizzi noted that he also heads the nonprofit San Diego Capital Collaborative, which was chartered by the task force. It works on low-and moderate-income housing issues.

He said the collaborative has raised about $90 million in equity capital over three years. The money is being used to encourage small developers to create urban infill housing and smart-growth projects.

“We raised that (money) from CalPERS (the California Public Employees Retirement System), Washington Mutual and Northwestern Mutual Life Insurance Co,” Adelizzi said. “They are getting a return on capital, but they also see a social benefit to it.”

A land bank can be formed using government seed capital that attracts private investors, Adelizzi said. “It may be foundations that understand that it is in the best interest of everyone to see these issues resolved quickly.

“This is a creative solution. It may not work in every community,” Adelizzi said.
San Diego Mayor Jerry Sanders yesterday said he welcomed the task force's recommendations.
“I will be excited to see them,” Sanders said. “I think those are very important issues to face, especially neighborhoods that need help.”

Pamela Beard, program manager of the nonprofit Housing Opportunities Collaborative, said the workload on HUD-approved loan counselors in the county has increased by 200 percent since the beginning of the year.

Gabe del Rio, the collaborative's president, warned that the full impact of the subprime lending crisis had yet to be felt. “We have not begun to see the real effects of what is happening,” he said.

Adelizzi said his concern was not for the health of the mortgage market, but for the people who have gotten caught up in foreclosures. The market eventually will correct itself, he said, “but we want to see it happen in a way that causes the least amount of pain.”

Foreclosures reach record high in San Diego

Foreclosures reach record high in San Diego


San Diego's distressed-property market grew substantially larger last month as mortgage defaults topped the 2,000 mark for the first time and foreclosures hit a record that was more than six times what they were a year ago.
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DataQuick Information Systems said notices of defaults, the first step leading to foreclosure, numbered 2,071 in August. That was up from 1,573 in July and more than twice the number recorded last year, 794. The previous record was 1,596 in June. DataQuick's figures go back to 1988.
Trust-deed sales, generally involving properties foreclosed on by lenders but not necessarily sold to a new buyer, totaled 833. That was up from 641 in July, 6.2 times higher than the 134 in August 2006. The previous record of 657 was in June.
The rise in foreclosure activity in San Diego comes amid a national crisis in mortgage lending focused on the subprime sector that has sent a record number of homes into the foreclosure process.
Earlier this month, the Mortgage Bankers Association reported in its quarterly National Delinquency Survey that 5.1 percent of 44 million loans surveyed were past due. That put the national rate of loans entering the foreclosure process last quarter at the highest level in the history of the survey, which dates to 1953.
Sunday in Home: The foreclosure problem does not play out equally across the United States. DataQuick said foreclosure resales throughout Southern California accounted for 8.8 percent of all sales activity in August, up from 8.3 percent from July and 2.2 percent in August 2006.
However, the company said the generally lower-priced foreclosures do not yet seem to be having a significant marketwide effect on prices, except in more heavily impacted Riverside and San Bernardino counties and high-desert markets.
“Other indicators of market distress continue to move in different directions,” the company said in its monthly report on prices and sales. “Financing with adjustable-rate mortgages is flat (and) financing with multiple mortgages has declined significantly.”
Down payments remain at a stable level and the low rate of quick resales, known as “flipping,” and investor purchasing is unchanged.
Many buyers in high-priced areas such as San Diego made widespread use of jumbo loans – those exceeding the $417,000 conforming loan limit set for major secondary mortgage market investors Fannie Mae and Freddie Mac. But with tightening credit and underwriting standards, those are slightly less prevalent, DataQuick found.
For Southern California, the first half of August saw 43.4 percent of home loans involving jumbos, while in the second half usage was 39.7 percent.
In San Diego County, jumbos accounted for 39.1 percent of all loans in July, 38.7 percent in the first half of August and 36.1 percent in the second half of the month.

San Diego Mortgage Market Stress

Mortgage market stress will soon show up in the San Diego Real Estate sales data

Fewer homes sold last month in San Diego County than in any August in 15 years, DataQuick Information Systems reported Wednesday.

The 3,104 homes sold marked a 19.4 percent drop in sales volume from August 2006, and a 48 percent drop from the nearly 6,000 homes sold in August 2005.

But last month's drastic tightening in the mortgage market didn't yet appear significantly in August's price and sales data, like some analysts previously predicted. A drastic tightening of restrictions on who could get a mortgage for more than $417,000, the threshold for so-called jumbo mortgages, hit the nation in August.

Investors who once clamored to back the risky loans grew skittish and largely withdrew their capital in response to skyrocketing foreclosures.Many of the deals that closed in August -- and that show up in data now -- began in July or early August, before the squeeze. Still, the same trouble that has plagued the region's home sellers and overleveraged homeowners for more than a year continued last month, with acute trouble in the south and east parts of the county.

The overall median price for homes sold last month was $475,000, a 4 percent and $20,000 drop from August 2006. But with a smaller pot and different mix of homes selling, the all-home median tells a vague, incomplete story. As the sales of more expensive or larger homes draw the median upward, it tends to mask the plummeting values in some neighborhoods.

Resale detached homes sold for a median $319 per square foot last month, a 5.8 percent drop from August 2006, and a 9 percent drop from the peak for that measure in May 2006. The price-per-square-foot marker has slid gradually in the last few months, from $329 in April to $326 in May, $321 in June, and $320 in July, according to DataQuick.

"You can't paint the whole market with one brush," said DataQuick analyst Andrew LePage. "But we look at that as kind of significant. Not one of these measures is perfect, but that one's been a pretty good indicator."An incessant flood of foreclosures through much of the county demonstrates one significant effect of the mortgage crunch: many people who borrowed money for a house a few years ago can't now qualify to refinance into the kind of reasonable terms they need to hang on to their homes.

RealtyTrac reported 2,699 new foreclosure filings in July, a 139 percent increase over July 2006 and a 907 percent increase over July 2005. That firm expects to release data for August next week."It's like somebody turned off the spigot all of a sudden," said Mark Goldman, a mortgage broker and real estate finance consultant for Windsor Capital Financial Corp. "I get two to three calls a week from people who are upside-down in their houses, getting behind in their payments."There's no places for them to go for a loan; they don't have equity," he said. "There's a world of hurt out there for these people."

Analysts expect the mortgage market stress will soon show up in the sales data.The rate at which borrowers used jumbo loans dropped in the last week of August, LePage said. In the last five days of the month, 29.9 percent of all home purchase loans were jumbo, compared to 34.5 percent in the last five days of July.In the whole month of August, 33 percent of the purchase loans in the county were jumbo, down from 35.6 percent in July and January-through-July rate of 35.7 percent."It's not huge, but it may be an indication of a larger trend," LePage said. "We'll watch the September numbers very closely.

"The decline in sales volume hit hardest in resale detached homes and new homes. The former logged a 22.6 percent drop from the previous August, with 1,667 homes sold. And the 647 new homes sold last month marked a 28.5 percent drop from August 2006's rate and a 58.8 percent drop from August 2005.

Sales of resale condos also shifted slightly downward; 790 units sold, a 0.6 percent drop from the same month the previous year.Sharyn Crown, a Coronado-based real estate broker with Napolitano GMAC Realty, said her 30 years in the real estate business have taken her through several downturns and booms, but there's something different about this one.

"The market is just different because people are so nervous," she said. "The lenders are running scared and the buyers are running scared. When you have a company like Countrywide (Financial Corp., a mortgage lender) laying off thousands of people, people get nervous.Regionally, South County areas including Chula Vista, National City and San Ysidro are experiencing the most acute trouble.

That part of the county "really stands out as being hammered harder than others," LePage said.That part of the county saw a 42 percent reduction in the number of homes sold compared to August 2006, and a 9.5 percent drop in the median price for resale houses.Crown said that's also been her experience with listings in that area, and added that East County's struggling, too."The South Bay is really suffering -- it's terrible," she said. "And in the East County, sometimes a price reduction doesn't even get the house sold.

It's hard for a lot of people to get realistic when things happen like this."But the buyer pool continues to shrink with the restrictions on mortgages for more than $417,000."Yeah, a lot of people have been squeezed out with requirements for higher credit, full documentation (of income), reserves -- the stuff people should have always had," Goldman said. "The dumb money has left the market."

Falling real estate prices offer 'special' opportunities

Agent: Lower prices bring lakefront views within reach

Falling real estate prices offer 'special' opportunitiesCounty median drops to $417,000-

Lower prices bring lakefront views within reach, agent saysMedian house prices in the County fell nearly 12 percent for August to $417,000, compared to $472,500 a year earlier, a real-estate tracking firm said Thursday.

Also in August, the number of houses and condominiums sold in the county fell almost 9 percent, to 138 residences from 151 residences the same month a year ago, according to figures collected from the county recorder's office by DataQuick Information Systems in San Diego.

The decline means properties with special features such as lake views and space for horses are dropping to very attractive prices for investors and for homeowners looking to move up, a real estate agent said."It's a fabulous time for buyers to buy," said Diane DiLeo of Network Real Estate in Grass Valley."Three things come together that come once or twice in a lifetime: Lower prices, great interest rates - which means lower payments - and to me, most importantly, selection. When else can you find lakefront property for under $400,000?"

In July, the county's median price stood at $429,000, and in June it was $470,000, DataQuick reported.The county median price fell faster than the statewide median in August, according to the Associated Press.The median price paid for a house in California in August was $465,000, down almost 3 percent from August 2006. The number of houses sold statewide fell nearly 35 percent in August to the lowest level for the month in 15 years.