Contact: Mark Church, Chief Elections Officer & Assessor-County Clerk-Recorder
Alternate: Terry Flinn, Special Assistant to the Assessor
(Redwood City, CA) San Mateo County Assessor Mark Church today announced the county’s Property Assessment Roll increased year-over-year by $15 billion, or 7.9%, to a record high $206 billion in assessed value, setting a new milestone for the county and breaking the $200 billion barrier for the first time.
“This is a major milestone, continuing to establish San Mateo County as a premier location in the state,” said Church. “The Roll is now more than 46% larger than it was in 2010. This is the sixth year in a row that a new historical high has been set, and the seventh consecutive year the Roll has moved in a positive direction.”
“Extensive business expansion throughout San Mateo County by industry leaders continues to be the catalyst for massive new construction, soaring job growth and rising real estate prices, resulting in another record roll value” Church added.
“We are seeing unprecedented growth in the technology, life sciences, and housing sectors, reinforcing San Mateo County’s reputation as a center of innovation, and establishing a strong economic base for the County’s future,” he further stated.
The 2017-18 Property Assessment Roll reflects consistent growth throughout the County. Total assessed values increased in all 20 cities and unincorporated areas, with increases ranging as high as 19.75%. The County’s unincorporated areas, which include San Francisco International Airport (SFO), experienced a growth rate of 9.46%. This increase was due in part to new state-mandated assessment practices which increased the assessed value of aircraft at SFO.
The top 5 cities in percentage growth are:
- East Palo Alto (+19.75%)
- Menlo Park (+10.52%)
- San Carlos (+9.13%)
- Redwood City (+8.52%)
- Foster City (+8.43%)
Rapid value growth in East Palo Alto is largely due to new projects coming to market, the transfer of the Woodland Park project, which includes 101 buildings on 49 acres, and residential value increases in one of the last affordable places on the peninsula. In nearby Menlo Park, and surrounding cities, there has been a trend of buying older houses to rehab or demolish and build new, which is increasing home values along with increased demand due to strong local employment.
The shared property tax funding base is approximately 1% of the county’s Property Assessment Roll, and will thus increase to $2.06 billion. Approximately 45% of revenue is allocated to schools within the county, 25% to the County, 18% to cities, 10% to special districts, and 2% to former redevelopment agencies. “The county’s share will be approximately $515 million, an increase of $95 million over last year,” noted Church.
The Property Assessment Roll is the assessed value of all properties as of January 1 each year, and reflects changes in ownership, new construction, value declines, and value restorations from the previous January 1. The Property Assessment Roll is composed of two sections, the Secured Roll and the Unsecured Roll. When combined, the two sections are referred to as the Combined Roll.
Secured Roll
The Secured Roll represents nearly 95% of the total Assessment Roll and includes 221,082 commercial and residential real properties. This year, the Secured Roll increased to $195.2 billion, approximately $13.9 billion or 7.7% more than 2016-17, reflecting continued economic growth in the county.
“San Mateo County continues to lead the State as one of the strongest real estate markets, with property values once again moving upwards,” said Church.
The Secured Roll’s growth is primarily due to the following factors:
Increased Values in the Local Real Estate Market. Sales and changes in ownership totaled $ 6.97 billion, which is over 50% of this year’s Secured Roll increase.
“San Mateo County has the lowest unemployment rate in the State for the third consecutive year, at 2.4%. Our strong job market has produced greater demand for housing and commercial space,” said Church. “The high demand, combined with a limited inventory, is the driving force behind escalating real estate values throughout the county,” he added.
According to the California Association of Realtors, San Mateo County has moved into the top position in the state for median home price for existing single family homes at $1,500,000, an increase of 11.1% from 2016, and topping San Francisco County for the first time in seven years. This is the highest median price in California and signifies another substantial increase in sales values for the 2017-18 Property Assessment Roll.
New Construction. Major projects in the county, those greater than 80,000 square feet, accounted for more than 2 million square feet of new improvements coming to market in 2016, with another 12 million square feet of new commercial development under construction in 2017.
Demand for housing, office, and life sciences continue to drive local development. Completed projects include Fuller Street Apartments, Indigo Apartments, and Marston Apartments in Redwood City; Atria Foster Square in Foster City; major ongoing expansions at Gilead in Foster City; Genentech in South San Francisco; and new office buildings at 400 Concar Drive and Bay Meadows in San Mateo, as well as University Square in East Palo Alto.
Approximately 58 million square feet of development remains in the pipeline in the county, based on pending projects and current construction. Pending projects include the Gateway at Millbrae Station with over 2 million square feet of new development, Facebook’s 1.6 million square feet of development in Menlo Park, redevelopment of 1.4 million square feet of the Stanford Research Institute (SRI) campus in Menlo Park, and redevelopment of Oyster Point Business Park with 2.3 million square feet of new construction.
Projects under construction include the Stanford Medical buildings in Redwood City; Marriot Springhill Suites in Belmont; The Trousdale assisted living project in Burlingame; Illumina’s new building, The Triton and Foster Square projects in Foster City; Bohannon’s Menlo Gateway project in east Menlo Park; and the San Carlos Transit Village, to name just a few.
Restoration of Assessed Value: Proposition 8/Decline in Value Program. The Proposition 8/Decline in Value Program provides property tax relief to property owners when the market value of a property falls below its assessed value. The number of residential properties qualifying for the Proposition 8/Decline in Value Program has dropped significantly from 34,700 properties in FY 2011-12 to 1,257 properties in FY 2017-18. On the commercial side, only 76 properties remain in the program from a high of 604 properties in FY 2012-13.
Over the next few days, approximately 2,885 property owners enrolled in the program will be mailed their 2017-18 Assessed Value Notices, with about 1,628 being fully restored to their base-year (Prop 13) values.
Annual Inflation Factor. Proposition 13, which governs property taxation in California, ties the annual inflation factor to the California Consumer Price Index (CCPI) issued by the California Industrial Relations Board and limits annual inflation increases to no more than 2%. This year an annual inflation factor of 2% was applied to the 2016-17 assessed value of all real property that did not have a change in ownership or any new construction during 2016.
Foreclosures
There were 86 Trustee’s Deeds recorded in calendar year 2016, a 27% decrease from the 118 recorded in 2015. Notice of Defaults decreased 14% from 609 in 2015 to 524 in 2016, continuing the downward trend in defaults since the high of 5,058 in 2009.
“This continued downward trend in foreclosure activities is an important indicator of a strong and healthy local economy,” said Church.
Unsecured Roll
The Unsecured Roll comprises approximately 5% of the Property Assessment Roll and includes the valuations of business/personal property and possessory interests (leased government property). This year, the Unsecured Roll increased to $10.8 billion in assessed value, an increase of more than $1.1 billion or 11.8% more than 2016-17. Most of the Unsecured Roll is personal property, which typically depreciates and is not limited to an inflationary value increase, as is real property on the Secured Roll. New construction at Facebook and changes in state-mandated assessment practices for aircraft at SFO were the largest contributors to the Unsecured Roll’s value increase.
Addenda:
Local Combined Roll – Fiscal Year 2017-2018
Local Secured Roll – Fiscal Year 2017-2018
Local Unsecured Roll – Fiscal Year 2017-2018
2017-18 Residential Decline in Value (Prop 8) Summary
Graph of Historical Combined Property Assessment Roll Values, 2005 through 2017
The press release is displayed in its original format. San Mateo County Assessor-County Clerk-Recorder & Elections website now resides at www.smcacre.org