Worried your property taxes will jump if you trade up to a new home in Los Gatos? If you bought years ago, your current Prop 13 assessed value is probably far below today’s prices. The good news is that California’s Proposition 19 lets many homeowners transfer that low tax base to a new primary home anywhere in the state. In this guide, you will learn who qualifies, how the math works, what to expect in Santa Clara County, and how to plan a smooth move. Let’s dive in.
Prop 19 in plain English
Prop 19 changed California’s property tax rules so eligible homeowners can transfer their current property tax base to a replacement primary residence. This can lower your ongoing tax bill after you move, which is especially helpful in high-value markets like Los Gatos.
Quick snapshot:
- Applies to your principal residence only.
- You may qualify if you are 55 or older, severely disabled, or your home was damaged in a declared disaster.
- You can generally use portability up to three times in your lifetime. Disaster-related moves may have broader relief.
- The replacement home must be in California and become your primary residence.
- You must buy or build the replacement within a limited time window relative to the sale of your original home. Confirm timing with the county assessor.
Who qualifies and what properties count
You qualify if at least one of these applies:
- You are 55 or older.
- You are severely disabled as defined for property tax relief.
- Your principal residence was substantially damaged or destroyed in a wildfire or other state-declared disaster.
Both properties are part of the equation:
- The home you sell must be your principal residence at the time of transfer.
- The home you buy must become your principal residence.
- Portability works anywhere in California. It does not apply to out-of-state moves.
- Eligible owners can typically transfer their base up to three times. Disaster victims may have exceptions.
How the tax base transfer is calculated
The core idea is simple. You can move your Prop 13 base year value from your current principal residence to your replacement principal residence. Your new assessed value depends on how the two homes’ market values compare at the time of transfer.
- If the replacement home’s market value is greater than the original home’s market value: new assessed value equals your original taxable value plus the difference in the two market values.
- If the replacement home’s market value is less than or equal to the original home’s market value: new assessed value equals your original taxable value.
Example A: Move up in price
- Original home: market value at sale is $1,200,000; current taxable value is $200,000.
- Replacement home: market value is $1,500,000.
- Difference is $300,000. New assessed value becomes $200,000 + $300,000 = $500,000.
Example B: Downsize
- Original home: market value is $1,200,000; taxable value is $200,000.
- Replacement home: market value is $900,000.
- New assessed value stays $200,000.
Counties use market value as of the transfer and may accept purchase price as market value. Practices can vary by county. Also plan for supplemental tax bills. Even with portability, the county typically issues supplemental assessments that cover changes during the fiscal year.
Timing rules and filing your claim in Santa Clara County
There is a limited time window to buy or build your replacement residence relative to the sale or change in ownership of your original home. Many sellers buy first and sell later, or sell first and buy later. The key is to keep both transactions within the allowed window. Confirm your specific timeline with the Santa Clara County Assessor’s Office.
To claim portability, you file with the county assessor of the replacement property. For Los Gatos homes, that is the Santa Clara County Assessor. Typical documents include recorded grant deeds, proof that your original home was your principal residence, and escrow statements. Filing early, ideally around closing, helps the assessor process your transfer and apply the correct base to your replacement home.
Expect a supplemental assessment on the replacement. Portability affects your ongoing assessed value but usually does not prevent supplemental tax bills for the portion of the fiscal year after your transfer.
Local considerations for Los Gatos sellers
Los Gatos is a high-value Silicon Valley market. Many long-time owners carry very low Prop 13 bases compared to today’s prices. Prop 19 can preserve a meaningful tax advantage if you move to a new primary home in California.
Your property tax bill includes the 1 percent base levy plus local assessments, parcel taxes, and possible district charges. Transferring your base primarily affects the portion tied to your assessed value. Special assessments that are tied to the property itself may not change.
Because replacement homes in and around Los Gatos often have higher market values, pay close attention to the “difference” calculation. In a move-up scenario, the difference between the two market values gets added to your carried base. The math still often results in significant savings compared to a full reassessment at purchase price.
Planning your move-up with Prop 19
A little preparation goes a long way. Use this plan to keep your move on track:
- Map your timing. Align your sale and purchase to fit within the allowed window. If you buy first, confirm how far ahead of your sale you can purchase and still qualify.
- Assemble documents. Gather grant deeds, prior tax bills, driver’s license and voter registration, and escrow closing statements.
- Budget for supplemental taxes. Even with portability, you will likely receive supplemental assessments after closing on the replacement property.
- Run the numbers. Compare your one-time costs with the long-term savings from a lower assessed value. In Los Gatos, the savings can be substantial over time.
- Contact the assessor early. Ask the Santa Clara County Assessor’s Office for current forms, deadlines, and any local filing tips.
How your agent helps
A strong listing agent coordinates the moving parts so you can focus on the next chapter. Your agent should:
- Confirm portability eligibility early.
- Coordinate sale and purchase timelines to protect eligibility.
- Ensure recorded documents and escrow papers reach the assessor quickly.
- Prep you for supplemental taxes and escrow prorations.
- Refer you to a tax professional for capital gains and estate questions.
With a hands-on approach and Compass resources like Concierge for pre-sale improvements, you can list with confidence and move on your schedule.
Realistic scenarios
Move-up within Los Gatos
You sell a home with a market value of $1,200,000 and a taxable value of $200,000. You buy at $1,500,000. Your new assessed value would be $500,000, which is the carried $200,000 base plus the $300,000 difference.
Downsize to a smaller home
You sell at $1,200,000 with a taxable value of $200,000, then buy at $900,000. Your new assessed value remains $200,000. This preserves your low base while you simplify your living situation.
Next steps
- Speak with the Santa Clara County Assessor’s Office about current forms and the timing window.
- Organize your documents and confirm your eligibility category.
- Coordinate with your agent and escrow so recorded deeds and statements are submitted promptly.
- Plan your cash flow for possible supplemental taxes after closing.
- Consult a CPA or attorney for capital gains and estate planning questions.
Ready to map out your move-up or downsizing plan in Los Gatos with a strategy that protects your property tax advantage? Connect with a local advisor who understands the rules and the market, and who can bring premium marketing and project management to your sale. Reach out to Ashley Mateo to talk through your timing, run the math, and prepare your home for a top-of-market result.
FAQs
Can I buy my replacement home before selling and still use Prop 19?
- Yes in many cases, as long as your purchase and sale fall within the allowed timing window. Confirm your dates with the county assessor.
How many times can I use Prop 19 portability?
- Eligible homeowners can generally transfer their base up to three times, and disaster-related transfers may have broader relief.
Does Prop 19 apply if I move out of California?
- No, portability applies only to replacement primary residences located within California.
Does Prop 19 change my capital gains taxes when I sell?
- No, Prop 19 affects property tax assessments only; capital gains are a separate federal and state matter.
Will I still get a supplemental tax bill after buying a replacement home?
- Most buyers should expect supplemental assessments that cover changes during the fiscal year even when portability applies.
Can I transfer my tax base to a different county in California?
- Yes, portability is statewide and you file your claim with the assessor where the replacement property is located.
Does Prop 19 work for second homes or rentals?
- No, portability only applies to principal residences that you own and occupy.
How do local assessments in Los Gatos change under Prop 19?
- Transferring your base adjusts the assessed value used for the 1 percent levy, while property-specific assessments may remain unchanged.
Can I move to a more expensive home and still transfer my base?
- Yes, but the difference between the two market values is added to your carried base when calculating the new assessment.
What documents do I need to file a Prop 19 claim?
- Plan on recorded deeds, proof the original home was your principal residence, and escrow statements for both sale and purchase.
