Probably varies by where you live, but I’ve never lived anywhere where property tax was was based on sale price.
Everywhere I’ve lived, the town/city does an assessment of what they think is the “market value” on a particular day in the past. Then they make some magical adjustments based on neighborhood/condition/seemingly whatever they feel like.
In particular, they will ignore foreclosures and short sales. If you try to use these sales as comps when arguing for a lower assessment, they will laugh you out of the room.
IN CA, because of prop 13, property tax is assessed based on what you paid. and can be increased by 2% per year.
^ What if I buy a house for $1? What happens?
Our property values are assessed similarly to what NRE described. Keeps the army of assessors employed! 
They will come and poke around your yard - if there is no fence. As soon as we put the fence up, the photos of the back side of the house stopped appearing on the property records site.
Nre
IF you bought a house in Ca for $1, they will assess it for $1. However, any renovation will trigger a reassessment.
The problem is that the worst house on the ca coast with 2500sf land 800 sf single family house is selling at around $250k. That is in a neighborhood with shooting on the street day and night. In the Bay Area that means crime ridden east Oakland and Richmond etc.
So my mom fixes up her house and then sells it to me for a dollar. And I never have to pay taxes?
^^ You probably have to assume the assessed value from your mom as an estate transaction, meaning if your mom passed away. Or they will call it a sham sale and re-assess to the market, they are not that dumm, they know the market better than you do because that is what they do. There is lot to it in property tax issues, it will take a large paragraph to recite the law and each county has a little bit difference to each other.
Now, a neighbor sold his house to his relative at his cost, whereas the market is about 20% above, they did not re-assess the value.
No, the IRS will come after your mom if she does not file a gift tax form. An estate tax attorney told me the IRS trawls property transfer records for such sales below market value to weed out disguised gifts to reduce the estate value… I’m sure there is a similar mechanism for local property taxes.
In California, property taxes are based on the amount paid in the sales transaction as long as it is an arms length transaction. However…they do run the sale price through a computer appraisal analysis. If the sale price is more than X percent off then it spits out and will be valued manually and the sale will be reviewed for arms length.
The buyer has to fill out a detailed form with info such as down payment, agent name, condition of house, etc. this has to get submitted as deed is recorded. If not submitted, there is a fine paid while recording ownership change. They use this form to help analyze value discrepancies or inter family transactions.
The little house on Catalina that you passed on just sold for $800K. And meanwhile, the chicken house is still pending!
And just for fun, here’s an attractive Spanish mansion in between the other two: http://www.sdlookup.com/MLS-170039310-1068_Santa_Barbara_St_San_Diego_CA_92107 They just dropped the price $100K after sitting on the market for over three months. The interior photos all seem a bit yellowy to me but I do really like the kitchen. I’m trying to figure out if that’s an aviary in the back yard.
I’ve toured the Santa Barbara Spanish style house. It is totally oozing with character, beautiful features and large rooms. The bedroom sizes are envious!! Kind of dark inside on bottom floor because of the size of the original windows. But…people won’t pay that price around here without getting a view. It’s going to be a hard sell
Chicken house has something fishy going on. The listing agent still has it in MLS but someone (I don’t think it’s the owner) is clearing it out and working on it. There’s been a dumpster in driveway for a month. All the landscape is torn out and cleaned up and interior gutted out. I keep checking public records for an ownership change or maybe Renovation Realty recording a lien against the property for their work
I finally figured out that one of the heirs lives next door because they just took out a loan on their house next door. Maybe a contractor sold them on doing the work and selling again. But why would the house still be Pending in Contract?? It is a mystery that I have been wasting a lot of time trying to solve:)
Maybe the heir next door took out the loan to buy out the rest of the heirs, and there’s just no urgency to update MLS or record it. The listing agent probably wants the listing after renovations, so he won’t do anything to push it.
How long does it take a change of ownership to make it into internet-accessible records?
Or maybe the heirs don’t want a change of ownership to show up for estate tax reasons? If a sale is recorded, any profit made after that would be taxable to the owner. But if the estate still owns it, the profit could get absorbed into the estate tax-free, if the timing works out. It’s a little dicey, but you have 6 months to do the assessment after the person dies. Hard to see how anyone would get caught.
Good theories on what might be going on.
Our County Recorder has their data available about 24 hrs after recording. It’s not easy to do searches, but it’s doable knowing the exact data needed. I am wasting too much time searching every day trying to decipher what is going on.
I was surprised to see that Santa Barbara Spanish had that price tag without any view photos.
An odd selection of photos for this house - http://www.sdlookup.com/MLS-170039815-3132_Mccall_San_Diego_CA_92106 . Almost no interior shots - nothing of kitchen or living room or baths. And the superzoom view photos are hilarious - I didn’t know there was a mountain bigger than Mt Rushmore right behind downtown!
$1.7 million and really no interior pics? Ok…
Sounds like some areas in my neck of the woods. Why even bother with photos if the description says “Medina view0.5 acre.”
McCall is being sold by the crazy Robert listing agent who writes up the descriptions with all the asterisks and liberally uses major zoom view photos. Priced too high, as usual. Its been on the market for about 30 days
He probably expired and then came back out with a new listing. That’s his strategy