Remote Surveillance Trailer in Mountain View, CA

Mountain View saw the most sluggish growth in its property values out of all cities in the county last year, as the commercial office market remained under pressure.

The combined assessed value of commercial and residential properties in Mountain View grew 2.93% in 2025, according to a July 6 report by the Santa Clara County Assessor’s Office. That’s higher than the 0.51% growth that the city saw in the prior year, but both are among the lowest rates since 2012.

Overall, assessed property values in Santa Clara County increased by 4.74% in 2025, with nearby cities such as Los Altos and Palo Alto increasing by 6.43% and 5.47%, respectively.

“We call it a mixed bag,” Santa Clara County Assessor Neysa Fligor said. “There is good residential growth, it’s just offset by what’s happening on the commercial space side.”

Mountain View has the county’s highest percentage of commercial parcels, with 18% of parcels in town designated commercial and 82% residential, Fligor said.

“This greater reliance on a weakened commercial market likely contributes to Mountain View’s comparatively lower rate of assessment growth, especially in recent years,” Fligor said.

The county’s assessment roll is the basis on which local property taxes are levied, which then fund various public services, including local schools. The data reported this week reflects the assessed value of all taxable property in Santa Clara County, as of Jan. 1, 2026.

Sources of tax roll growth

Sunnyvale had the greatest roll growth in the county at 7.17%. Cities largely composed of residential properties — such as Palo Alto and Los Altos — also saw higher rates of growth.

Under Proposition 13, approved by voters in 1978, a property’s assessed value cannot increase annually by more than 2% or the rate of inflation, whichever is lower, unless the property is reassessed because of new construction or a change in ownership.

When a property is sold, the assessed value resets to the market value. Those changes in ownership added $16.9 billion to the property roll. The application of the 2% inflation factor added another $14 billion. In total, the roll grew by about $35 billion, to roughly $760.1 billion.

“With what’s happening in the AI sphere, we are seeing, especially in the high-end markets, people buying residential homes,” Fligor said. “What that tells me about the economy is there is still buying power.”

New construction was another source of growth, adding $4.9 billion to the assessment roll. Construction at major commercial properties included Google and Intuitive Surgical in Sunnyvale and Applied Materials in Santa Clara.

Additionally, data centers have increasingly contributed to roll growth. There are at least 50 data centers in the city of Santa Clara alone, with more centers being constructed in San Jose, according to the report.

“Data centers are valuable properties — the physical property itself, but also the equipment at the site,” Fligor said.

Drags on tax roll growth

These gains were offset by an increase in property value reassessments under Proposition 8. Approved by voters in 1978, a county assessor can temporarily reduce a property’s assessed value when its market value falls below its assessed value. This temporary reduction can happen automatically through the assessor’s appraisal process or from a request by the property owner. A temporary reduction in the appraised value decreases the amount of taxes a property owner is required to pay and remains in place until the market recovers.

Prop. 8 temporary reductions for the county totaled $9.4 billion in 2025, an increase of $3.3 billion from 2024, with 24,727 properties in Prop. 8 decline status, nearly triple the previous year, according to the report.

“We’re definitely seeing a drop there in the purchase price for a lot of these commercial properties,” Fligor said. “What we have happening as a result of these reductions in value is appeals being filed.”

Currently, roughly $153.6 billion of assessed value is under appeal, with 98% of that figure coming from commercial properties, according to the report.

Before pursuing the formal appeal process, property owners can file for a free, informal review of their assessment, Fligor said. Reviews must be filed by Aug. 8.

In a windfall for Mountain View, the California Department of Housing and Community Development recently awarded the city $50 million to support an affordable housing project and transportation improvements on Middlefield Road.

The City Council authorized the city manager to accept the award last month with the bulk of the funding, $35 million, slated to go to the construction of a seven-story affordable apartment complex at 87 E. Evelyn Ave. The item was part of the council’s consent agenda, which is a collection of routine matters meant to be passed in a single vote.

“We all care a lot about housing,” Councilmember Pat Showalter said at the June 23 meeting. “We’ve been recognized as a pro-housing city, but this is the largest affordable housing grant that we’ve gotten.”

Last year, the city applied for the funding through the state’s Affordable Housing and Sustainable Communities Program. The initiative seeks to integrate affordable housing near transit.

As part of the application process, Mountain View partnered with Affirmed Housing, the nonprofit developer building the affordable housing project at 87 E. Evelyn Ave. The lot currently operates as a safe parking site for people living in their vehicles.

In its place, Affirmed Housing is proposing to construct a 268-apartment complex, including 161 apartments for low- and very low-income households. Half of the apartments will be two- and three-bedrooms, according to the city staff report. Construction is expected to begin by mid-December.

The $35 million will be administered as a loan and will go directly to Affirmed Housing, the staff report said. The rest of the award will be issued as a grant to support program costs for the 87 E. Evelyn project, as well as transportation projects in the city.

Transportation improvements

Mountain View also partnered with the Peninsula Corridor Joint Powers Board, which operates Caltrain, to boost its chances of getting the award. The collaboration paid off, as approximately $14.4 million will be used to fund transportation projects.

About $8.9 million will cover the purchase of two new train cars to improve service between San Jose and San Francisco, according to the staff report.

A portion of the grant will also support hyper-local projects, including roughly $5.2 million for transportation improvements on Middlefield Road. The award will help fund the design and construction of protected bike lanes between Moffett Boulevard and Bernardo Avenue, as well as pedestrian and bicycle upgrades at four intersections: Moffett Boulevard, Easy Street, Tyrella Avenue and North Whisman Road.

The grant will also cover the installation of 10 new bus shelters near the Evelyn affordable housing site, which will cost $330,000, according to the staff report.

Additionally, the award will cover program costs associated with the Evelyn housing project, including discounted VTA passes for residents for three years, high-speed internet access for three years, rental assistance and workforce development opportunities, the staff report said.

This story originally appeared in the Mountain View Voice. Emily Margaretten joined the Mountain View Voice in 2023 as a reporter covering City Hall.