UPDATE - The filing deadline for the 2007 tax year (property tax bills due in Dec 2007 and April 2008) is closed.  You do NOT need to file a form for the 2008 tax year until after you have received your new tax bill in the summer of 2008.  The Assessor's office has current property sales information and is taking this into consideration in preparation of the upcoming billing.  - Mike O'Connor - March 11, 2008

Prop 8 allows for a "Decline-in-Value Reassessment" which needs to be supported by comparable property sales. The Assessor's Office is proactively revaluing properties downward (and many Riverside County residences were revalued) but individual homeowners are permitted to submit their own request for reassessment. The form can be found at their website at:

http://riverside.asrclkrec.com/ACR/INassessment.asp#prop8

An appraisal by the homeowner is NOT required however you are required to show similiar property sales as close to January 1, 2007 as possible and no later than March 31, 2007. As we are seeing much of the downward price spiral happening NOW it probably won't mean much for the current year but it should definitely have an impact for next year.

Once a property has a Prop 8 reassessment, your assessment MAY change upwards at a FASTER rate than the 2% cap you would normally expect. The upwards assessments will only happen until you have 'caught-up' to the Prop 13 cap you would have had if you never had a downward assessment in the first place.

It's kinda complicated math but let me try to clarify: Bought in year 1 for $500,000. Year 2 assessment is $510,000 ($500,000*1.02 = $510,000). Year 3 assessment is $520,200 ($510,000*1.02 = $520,200).

Let's say in year 2 you successfully petition for a reassessment to $480,000 due to declining values. Your year 3 assessment should go up to $489,600 ($480,000*1.02 = $489,600) under the 2% cap situation. But if prices have 'recovered' in year 3, your assessment value may go as high as $520,200 which was the limit you had if you never had the downward Prop 8 adjustment.

You are never in a situation where you need to 'make-up' the tax savings from year 2.

I am more than happy to assist local homeowners who may need assistance in identifying comparable sales for their areas.  Remember - the deadline for submittal is December 31, 2007!