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When you own the home you only pay property tax generally after you pay the mortgage and in states like California that can mean an incredibly cheap place to live once paid (I’m talking 100s of dollars a year, though that will go up over time).
This is actually a significant cause of California’s housing crisis.
Well that’s ridiculous. What do you expect people do to, just give up the house they live in for someone else who needs a house? This isn’t Palestine, it’s the USA and we are well within our rights to keep living in the homes we paid for.
Yes, absolutely, in California. Generally, everywhere too but that’s a much broader topic.
In California specifically, property tax costs are based on the grandfathered price of the house, which means that there are people who inherited homes bought for $30k 80 years ago and still pay that amount of property tax.
This traps both the taxable value of the house and the land itself and keeps it from being developed, when normally someone might be priced out by the taxes a $10 million home would generally cost.
In the State of California, real property is reassessed at market value if it is sold or transferred and property taxes can sometimes increase dramatically as a result. However, if the sale or transfer is between parents and their children, under limited circumstances, the property will not be reassessed if certain conditions are met and the proper application is timely filed.
It’s just one of many reasons (which is why housing costs are insane everywhere), but it is a significant contributor in California.
Generally, the law being written to benefit homeowners is the single greatest cause of our housing crisis, and this is one element of how those laws are crafted toward existing homeowners.
Consider: if homes are “nest eggs” that always go up in value, what is happening to the price of homes, all the time?
This is actually a significant cause of California’s housing crisis.
Are you saying that people living in the homes that they own are causing the housing crisis? Or what?
Kind of yeah. Prop 13 definitely is part of the issue.
Well that’s ridiculous. What do you expect people do to, just give up the house they live in for someone else who needs a house? This isn’t Palestine, it’s the USA and we are well within our rights to keep living in the homes we paid for.
Yes, absolutely, in California. Generally, everywhere too but that’s a much broader topic.
In California specifically, property tax costs are based on the grandfathered price of the house, which means that there are people who inherited homes bought for $30k 80 years ago and still pay that amount of property tax.
This traps both the taxable value of the house and the land itself and keeps it from being developed, when normally someone might be priced out by the taxes a $10 million home would generally cost.
https://www.sfassessor.org/tax-savings/exclusions/reappraisal-exclusion-grandparent-grandchild
It’s just one of many reasons (which is why housing costs are insane everywhere), but it is a significant contributor in California.
Generally, the law being written to benefit homeowners is the single greatest cause of our housing crisis, and this is one element of how those laws are crafted toward existing homeowners.
Consider: if homes are “nest eggs” that always go up in value, what is happening to the price of homes, all the time?