If you’ve ever looked at a property tax statement, you’ll notice there’s at least one parcel number listed. This is your assessor’s parcel number (APN), and APNs are used to determine your property tax burden.
When buying property, you may see the term “legal parcel” and this is not necessarily the same as your assessor’s parcel. As land is divided and subdivided over time, a legal parcel can be made up of multiple assessor’s parcels. This is important because each assessor’s parcel may be subject to different tax burdens.
If you live in a subdivision full of regular lots, chances are the APN and the legal parcel are one and the same. If, on the other hand, you own an older home or you own an acre or two (or more), there’s a decent chance that your property is made up of multiple APNs.
Boundary line adjustments, easements, or a merging of adjacent properties can all lead to a patchwork of APNs for a single legal parcel. This is something all Realtors in Mendocino County are aware of, but it was news to a broker I met from the Bay Area because even though he’d been in the business for years, he had only ever dealt with subdivisions in urban and suburban settings.
Around here, things are different. Let’s say you own 150 acres in Hopland—one legal parcel. A portion of the property might be in a cemetery district, another part might be in the school district, and to complicate things, the property may include an easement across your neighbor’s property that allows you to access your property. When you receive your tax bill, it’ll indicate three APNs with three separate tax liabilities.
If you’re curious about how property is divided, you can go to a local title company or the County Assessor’s Office and request a plat map. Plat maps show geographic areas overlayed with individual property boundaries. They can include everything from subdivision numbers to legal descriptions to APNs.
Sometimes APNs change over time. If there’s a new subdivision or boundary line adjustment, the county will assign a new APN, so the number you’ve always seen may change. This can make it difficult to compare historical records with current records.
Knowing the history of a legal parcel is not only important for tax reasons, but also if you want to divide the property along original boundary lines, which can dramatically increase the market value. If the 150-acre parcel in Hopland was created by merging multiple legal parcels, you can split the property along the original lines. Let’s say those 150 acres were originally ten legal parcels. If you can prove that to the county, you can sell each parcel individually without going through the legal rigamarole of getting a new subdivision approved by the county. Note, you cannot sell only part of your parcel unless that section is recognized as its own legal parcel. Having the county recognize separate legal parcels within one property is called a certificate of compliance.
Once I learned the hard way that if your title company makes a mistake and doesn’t include all the legal descriptions when you acquire a property, then you may not have a legal parcel and you cannot sell the property.
The long and short of it is this: knowing the difference between your legal parcel and your assessor’s parcel(s) can allow you to profit from your real estate investment.
If you have questions about property management or real estate, please contact me at rselzer@selzerrealty.com or call (707) 462-4000. If you have an idea for a future column, share it with me and if I use it, I’ll send you a $25 gift certificate to Schat’s Bakery.
Dick Selzer is a real estate broker who has been in the business for more than 45 years.