T
he assessed value of real estate in Santa Clara County reached a record $725.7 billion as of January 1, 2025, but the growth rate was sluggish due to challenges in the commercial real estate market. The assessment roll increased by just 4.15%, or $28.9 billion, from the previous year, marking its slowest growth since 2012.

    County Assessor Larry Stone attributed the slowdown to the rise of remote work, office vacancies, and delinquencies, which have plagued Silicon Valley and the nation in recent years. The office vacancy rate in Silicon Valley has remained around 20% for two years, while significant layoffs in the tech industry have created a negative feedback loop, contributing to increased vacancies and declining rental rates.

    The five cities with the lowest growth rates were Mountain View, Sunnyvale, Milpitas, Cupertino, and San Jose. In contrast, Morgan Hill saw the highest rate of growth due to stable residential property values, while Santa Clara benefited from investments in data centers. According to Stone, data centers are becoming increasingly popular as companies pour money into building them across the country.

    The main sources of roll growth this year were changes in ownership and Prop 13 2% property tax increases for properties that didn't change hands or experience new construction. However, reductions in the commercial real estate sector decreased the roll by $4.5 billion, offsetting any value added by business properties.

    Property owners have until August 1 to informally appeal their assessed values and September 15 to apply for a Prop 8 reduction. The county assessor's office expects an increase in appeals filed this year, with 98% of the over $100 billion in assessed value currently under appeal being commercial property.

    Despite economic uncertainty, Stone remains optimistic about Silicon Valley's future, citing its resilience and the continued investment by trillion-dollar companies like Apple and NVIDIA.