Housing slump means those who buy now could save on taxes

One silver lining in the current housing market is the ability of home buyers to not only purchase a more affordable home, but also ensure lower property tax payments. Under Proposition 13, a measure passed in 1978 that limits property tax increases, the sale price of a home is generally used to set the home’s base value and subsequent property tax assessment. Proposition 13 also ensures that annual assessments will not increase more than 2 percent each year.