California Property Tax Guide: Rates, Rules, and Due Dates

California offers a lot in the way of prime property and is definitely one of the top areas of attraction real estate-wise. Now, you would expect that given such a back story, property taxes would be through the roof.

You would be wrong. California homeowners actually pay well below the national average in property taxes. According to the Tax Foundation (2024), the latest effective rate is approximately 0.74%, compared to the U.S. average of 0.99%. When including typical local assessments and bonds, the total usually comes to around 1.1%.

So, how do property taxes work in California?

Your tax is determined using the purchase price of the property since the purchase price usually equates to the assessed value. From here on out, your assessed value sees an increase annually based on the inflation rate.

The inflation rate comes from changes in the California Consumer Price Index.

What are Property Taxes?

In simple terms, property taxes are government-imposed levies on real estate ownership. Taxes are mainly levied at state, county, and local levels. By way of some ancient history, property tax has been for the longest time and can be traced back to the 6th century B.C. 

In the U.S., property taxes were levied even prior to income tax. All states, as well as Washington D.C., levy a property tax while certain states do not even levy an income tax.

Owning real property in California implies that you would mandatorily have to pay real property taxes. It really doesn’t matter if you own rental property or if you got the property as a gift, you would pay property tax all the same. 

Similarly, payment of property tax isn’t designated by property price. In other words, whether you have a $60,000 or a $6,000,000 property, you would still pay based on the respective home values. 

There is a possibility that you purchase property mid-year, and when this happens, your real estate agent would likely negotiate to split the real property tax payment for that calendar year with the seller.

To confirm whether this is the arrangement made, review your mortgage interest statement.

Property Tax Calculator

Use our free calculator to find out how much taxes are paid on a property.

How are Property Taxes Calculated?

Assessment of property and calculation of property tax in California are still determined by Proposition 13 (1978). In practice, you multiply your home’s assessed value—frozen at its purchase or construction price—by the tax rate that applies in your county.

Key Factors in Property Tax Calculation

• Base Tax Rate – 1 %. Every property starts with a 1 % levy set statewide.
• Local Add-Ons – ≈ 0.10 – 0.35 %. Voter-approved bonds, parcel taxes, and Mello-Roos districts usually lift the effective rate to about 1.1 %.
• Annual Increase Cap – Lesser of CPI or 2 %. Each January, assessors may raise last year’s value by no more than 2 %, even if market prices climb faster.
• Reassessment Triggers. A fresh assessment occurs only when:
  • The home is sold or ownership transfers.
  • Major new construction or remodeling is completed.
  • A base-year value transfer is claimed under Proposition 19 (owners 55+, severely disabled, or wildfire victims).

Example:‍

If you purchase a home for $500,000 in 2025 and your county’s local add-on is 0.15 %, your first annual bill is roughly:

$500,000 × 1.15 % = $5,750.

Because the CPI adjustment is capped at 2 %, the assessed value can rise to only $510,000 the next year, bringing the tax to about $5,865, unless a new reassessment event occurs.

When Are Property Taxes Due in California?

Tax day comes around pretty fast and if you’re not careful, it might meet you unprepared. In addition to filing your income taxes, you should keep an eye on your property taxes too. The State of California’s fiscal year begins on July 1st and runs through to June 30th.

Property taxes are assessed and collected by the county your home is located in. 

First off, it is essential to remember that there are two installments due, as well as recall the date of these installments.

The first installment runs from July 1st through December 31st and tax payment is slated for November 1st, and only becomes delinquent on December 10th. Failure to make a payment by 5 p.m. on the delinquent date attracts a penalty of 10%. 

The second installment is due by 1st February and becomes delinquent on 10th April. To recall, just have the mnemonic “No Darn Fooling Around” (representing the first letter of each month) ringing in your head and you would remember for sure!

Remember that failure to pay property taxes as at when due see your penalties rising consistently. 

If you pay your property taxes alongside your mortgage, you would not have any unpaid balance by November 1. 

Penalties for Late or Unpaid Property Taxes

Missing a property-tax deadline in California gets expensive fast. Once an installment becomes delinquent, the county adds hefty fees and interest that compound over time. Here’s what happens:

• 10 % delinquency penalty – Applied the day after the installment’s grace date (December 11 for the first half; April 11 for the second half).
• County collection charge – A flat administrative fee (usually $10 – $35) tacked on when the second installment goes delinquent.
• Redemption fee plus monthly interest – If any balance remains on July 1, the tax is declared “defaulted,” a one-time redemption fee (about $33) is added, and interest begins accruing at 1.5 % per month (18 % APR) until paid in full.
• Tax-sale risk after five years – Parcels that stay in default for five years (or three years for some non-owner-occupied property) can be sold at public auction to satisfy the debt.

In short, pay on or before December 10 and April 10 to avoid penalties; even a short delay can add hundreds of dollars to your bill and put your property at risk over the long term.

Where Do Your Property Tax Dollars Go?

Now, this is a question that many property owners ask. What happens to all the property taxes that you pay? Well, your property tax is what keeps the state and local governments functioning. They comprise a bulk of the revenue that goes into funding public safety, infrastructure, public schools, as well as the county government. 

Particularly for public schools, it is easy to find that the best public schools are located in municipalities that have highly-priced homes and as a result, significant property taxes.

County projects are funded by some states, while others leave the counties to carry out the levying and tax use without interfering. This implies that the county has only property taxes as its source of funding.  

Here’s a summary of public services that your tax dollars go towards funding:

• General government services 
• First responders and other law enforcement
• Municipal employees’ pay
• Municipal infrastructure and land construction or improvements
• Local levies
• Protective services
• Recreational services
  

Confused About Property Taxes vs Real Estate Taxes?

You've probably heard the terms property taxes and real estate taxes used multiple times, and you're wondering if there's a difference?

Well, the key difference between property taxes and real estate taxes is that there is no difference. They are identical and used interchangeably. So, next time you hear these terms being used within the same frame of conversation, you know that it's pretty much the same. 

Final Thoughts on Property Taxes and How they Work 

Property taxes are necessary for running the county and state by extension, and this is why they are so important. You can easily calculate your property tax ahead of time and now you know exactly where these funds go. And if you ever forget the dates, remember, No Darn Fooling Around!