Valuation of Manufactured Homes For California Property Tax Purposes

A frequently asked question regarding manufactured homes (mobilehomes) assessment is why the Assessor appears to ignore sales price when establishing assessed value. The methodology used to appraise mobilehomes is based on state law and regulations.

Section 5803(b) of the California Revenue and Taxation Code specifically provides that the assessed value of a manufactured home located on rented or leased land is not to include any increase or decrease in value attributable to the particular site where the manufactured home is located. Section 5803(b) reads:

“The Legislature finds and declares that, because owners of manufactured homes subject to property taxation on rented or leased land do not own the land on which the manufactured home is located and are subject to having the manufactured home removed upon termination of tenancy, 'full cash value' for purposes of subdivision (a) does not include any value attributable to the particular site where the manufactured home is located on rented or leased land which would make the sale price of the manufactured home at that location different from its price at some other location on rented or leased land.

In determining the 'full cash value' of such a manufactured home on rented or leased land, the assessor shall take into consideration, among other relevant factors, sale prices¹ listed in recognized value guides for manufactured homes, including, but not limited to, the Kelley Blue Book Manufactured Housing and mobilehome Guide and the National Automobile Dealer Association's mobilehome Manufactured Housing Appraisal Guide."​​

Letter to Assessors No. 93/35 goes on to state that,

"The effect of the site upon the sale price of a manufactured home can be either positive or negative. Section 5803 (b) states that the full cash value of a manufactured home excludes any value attributable to the particular site. Thus, the assessor must not include any 'add-on' value for positive site influence in the assessment of the manufactured home.”

Moreover, in situations where negative site values exist, it is the site, not the manufactured home, that is entitled to a reduction in value. Such negatively impacted sites cannot command the same rental level as comparable sites that do not face the same adverse consequences. As a result, the manufactured home owners pay reduced rents for the negative sites, but they should pay proportional taxes on the manufactured homes, per se, because the homes perform as constructed without any decrease in value."

Letter to Assessors No. 93/35 also discusses the three traditional approaches to valuation: Replacement Cost, Comparable Sales, and the Income Approach. It concludes that:

"Clearly, of the approaches to value described above, the replacement cost approach, using an indicator from a recognized value guide plus the value of all manufactured home accessories, buildings and structures (this includes items such as skirting, awnings, cabanas, storage cabinets, porches, flatwork, carports, garages, storage sheds, and landscaping, etc.) best provides the assessor with a value free of site value. Obviously, this approach is also best in ensuring compliance with the legislative directive to consider the value indicated by a recognized value guide."

In recognition of the requirements of Section 5803(b), the Sacramento County Assessors Office uses the following cost guides to arrive at a value conclusion:

State Board Of Equalization Assessor's Handbook Section 531.35
N.A.D.A. Mobile/Manufactured Housing Appraisal Guide

If you have any questions, please contact the Assessor's customer service counter at (916) 875-0700.


¹These ''sale prices' are from Dealer Lots, and not from sales in a Park.