Why did my property taxes go up after buying a house? Prop 13, Save Our Homes and the Texas cap

Your property tax bill goes up after a purchase because the seller’s assessed value was held down by a cap that ended at closing.

California’s Proposition 13 limits growth to 2 percent a year, Florida’s Save Our Homes to 3 percent, and Texas’s homestead cap to 10 percent, but all three reset to market value when the home changes hands. The tax figure on the listing was the seller’s bill, not yours.

Why do property taxes go up after a sale? The three caps

State	Cap while owned	What happens at sale	When you feel it
California	2 percent a year on the base year value	Reassessed to the purchase price	Supplemental bill within months, then every year
Florida	3 percent or CPI, whichever is lower	Assessed at just value on the January 1 after the sale	The bill mailed the following November
Texas	10 percent a year on a homestead	The seller’s cap expires on the January 1 after the sale	The bill mailed the following October

Lenders set your first escrow from the seller’s bill, so the shock lands twice: a higher bill, then an escrow shortage and a higher monthly payment.

Prop 13 property tax reassessment in California

Under Proposition 13 the tax is 1 percent of assessed value plus voter-approved debt, and assessed value grows at most 2 percent a year from a base year value. The Board of Equalization states that when ownership changes, the assessor must reassess the property to its current fair market value as of the date ownership changed. That is your purchase price.

Worked example. A seller bought in 1999 for $250,000. Compounding at 2 percent for 27 years gives a factored base year value of about $427,000 and a bill of roughly $4,270 at the 1 percent rate. You buy in 2026 for $1,100,000. Your bill is about $11,000 plus voter-approved debt, more than double the seller’s.

The supplemental bill. You do not wait for the next regular bill. The assessor issues a supplemental assessment for the difference between the new and old values, prorated for the months left in the fiscal year ending June 30. Purchases from January through May generate two supplemental bills; June through December generate one. Lenders usually do not pay these from escrow. See the California page.

Florida Save Our Homes: the reset on the January 1 after you buy

Section 193.155 caps annual growth in a homesteaded property’s assessed value at the lower of 3 percent or the CPI change, then states the reset: property shall be assessed at just value as of January 1 of the year following a change of ownership.

Worked example. The seller has owned since 2010. Just value is $450,000, capped assessed value $260,000. After the $50,000 homestead exemption the seller’s taxable value is about $210,000, and at 17 mills the bill is about $3,570. You close in 2026 and pay that bill for the rest of the year.

On January 1, 2027 the assessed value resets to $450,000. With your own homestead filed by March 1, 2027, taxable value is about $400,000 and the bill about $6,800, a 90 percent increase. The 17 mill figure is an illustration; use your county’s actual rate.

Portability. If you are leaving another Florida homestead, you can transfer the difference between its just value and assessed value, up to $500,000, to the new home, provided the new homestead is established by January 1 of the third year after leaving the old one. File DR-501T with your homestead application. Newcomers from out of state get no portability. See the Florida page.

Texas homestead cap: it expires when the owner leaves

Texas has no Proposition 13, but Tax Code 23.23 limits a homestead’s appraised value to last year’s value plus 10 percent plus new improvements. Two clauses govern buyers. The cap takes effect on January 1 of the year after the owner first qualifies for the exemption, and it expires on January 1 of the first year that neither that owner nor the owner’s spouse qualifies.

Worked example. In Harris County the seller’s home has a market value of $420,000 but a capped appraised value of $330,000. You buy in mid-2026 and pay on $330,000 for the rest of the year. On January 1, 2027 the seller’s cap expires and the district appraises you at market value.

At a 2.0 percent combined rate, used here as an illustration, that is $8,400 before exemptions against the seller’s $6,600. Your $140,000 school district exemption offsets part of it, but your own cap does not protect you until January 1, 2028.

Two mitigations: since 2022 you can claim a prorated homestead exemption for the part of the purchase year after closing if the seller was not receiving one, and you can protest the 2027 value by May 15 using your purchase price as evidence. See how to protest property taxes in Texas.

What makes property taxes go up in states without a cap

Illinois and Georgia do not reset values at sale, but a sale is public evidence the assessor uses. In Cook County a purchase well above the current assessed value tends to appear at the next triennial reassessment.

Georgia’s HB 581 floating exemption caps taxable growth at inflation for owners who keep it, but a new owner’s base is the value in the year after purchase. Check Cook County and DeKalb County for local rates.

How to estimate your property tax bill before you sign

Start from the purchase price, not the assessed value. In California, Florida and Texas, assume the assessor will use your price.
Subtract the exemptions you will actually get: $140,000 from school district value in Texas, up to $50,000 in Florida, $7,000 in California, the county’s homestead amount in Georgia and Illinois.
Multiply by the current effective rate for the county. The estimator does this in one step.
Add the transition bill: one or two supplemental bills in California, or the jump on the autumn bill the year after purchase in Florida and Texas.
Tell your lender to base escrow on the estimated new bill, so the second-year payment does not spike.

A quick check with our Census figures: a $500,000 purchase at Texas’s median effective rate of 1.58 percent is about $7,900 a year; at Florida’s 0.79 percent about $3,950; at California’s 0.71 percent about $3,550. County rates differ, which is why the county page matters.

This is general information, not tax or legal advice. Confirm reset rules and exemption deadlines with the county for the home you are buying.

Frequently asked questions

Why did my property taxes go up after I bought my house?

Because the seller's assessed value was held down by a cap that ended at closing. California's Proposition 13 limits growth to 2 percent a year, Florida's Save Our Homes to 3 percent, and Texas's homestead cap to 10 percent, and all three reset to market value when ownership changes. The tax figure on the listing was the seller's bill on the old value, not yours.

Do property taxes go up every year?

Usually, but by different mechanisms. In capped states the assessed value rises by the cap each year, 2 percent in California and up to 3 percent in Florida, plus whatever rate changes local governments adopt. In uncapped states the value moves with the market at each reassessment. Everywhere, the rate itself can change when a school district or county sets its budget.

How does Prop 13 property tax reassessment work in California?

Proposition 13 sets the tax at 1 percent of assessed value plus voter-approved debt, and lets assessed value grow at most 2 percent a year from a base year value. When ownership changes, the county assessor must reassess to current market value as of the transfer date, which in practice is your purchase price. Transfers between spouses, and certain parent-to-child transfers of a family home under Proposition 19, are excluded.

What is the Florida Save Our Homes cap?

Section 193.155 caps annual increases in a homesteaded property's assessed value at 3 percent or the change in CPI, whichever is lower. After a sale, the property is assessed at just value as of January 1 of the following year. If you are moving from another Florida homestead you can transfer up to $500,000 of the accumulated difference to the new home by filing DR-501T with your homestead application.

How can I avoid property tax reassessment in California?

Only through the exclusions in the Constitution: transfers between spouses or registered domestic partners, and a parent-to-child or grandparent-to-grandchild transfer of a family home that the child moves into, within the value limits set by Proposition 19, with a claim filed. An ordinary purchase is reassessed to the price paid, and there is no way around that.

How do I estimate my property tax bill before buying?

Start from the purchase price, not the seller's assessed value. Subtract the exemptions you will actually get: $140,000 off school district value in Texas, up to $50,000 in Florida, $7,000 in California. Multiply by the county's effective rate, which the estimator does in one step. Then add the transition: one or two supplemental bills in California, or the jump on the bill mailed the autumn after purchase in Florida and Texas.