Prop 13 (megatopic) (Orange: homeowner, estate, residential)

[expatCA]

Originally Posted by Reziac

Those who also own rental properties certainly care...

True, because they do not want to lose money as their costs go up each year.

[expatCA]

Originally Posted by CA4Now

Anecdotal "data" if we've ever heard it...

Yeah, like Realtors pushing Prop 13.

[expatCA]

Originally Posted by HereOnMars

Well there you go. Problem solved. You don't have to give another thought to what happens to our little state. You can enjoy the rest of your life wherever it is you live. Ain't it great?

You're right. There is no state in the country that has exactly what we have here but they all have some sort of tax model that voters have approved. No one wants to see their property taxes jump 6% a year as it did in the state of Washington some years ago. Also, realtors had absolutely nothing to do with why Prop 13 came to be. The idea came from Howard Jarvis and with the help of Paul Gann, they wrote and presented the proposition to the voters. Neither of them were realtors. Google their names if you don't know who they are. Considering it was passed by 65% of voters, I think your assumption that it was opposed was coming from lawmakers and not voters. Lawmakers AND Jerry Brown opposed it but it passed anyway because we had smart taxpayers in the state. Now? Meh. Not so much.

No one wants it to jump 6% even in one year. In CA that would be a LOT of money. Making it harder for people to be able to buy.

[Ultrarunner]

Originally Posted by Pyramidsurf

You may say that, but it doesn't make it true. I worked in CA public finance consulting dealing directly with property taxes before I went into my current career. The reality is Prop 13 is structured like a Ponzi scheme in the same way Social Security is. New purchases pay more to fund the lower tax base of aged home purchases. Full stop. There is no other way to put it or twist it and say it is somehow something else.

The question becomes a public policy issue on if Prop 13 is beneficial to the residents of California. But it is no way shape or form a "fair" or "equitable" tax system.

If you worked in Public Finance (And I have no reason to doubt you) you know Prop 13 is based soley on Fair Market Value at time of transfer.

Case in point...

In 2004 I bought my home for 600k... all 1725 square feet of 1958 construction... no upgrades.

In 2011 the home next to me sold for 550k... all 3100 square feet of 2003 construction... custom build with lots of high end features and style... it was a foreclosure.

How is I bought 7 years earlier, 45 years older and nearly half the size home and my taxes are more than my neighbor.

Clearly by the logic of many my new neighbor should be subsidizing me but I guess I am subsidizing him???

My example is not isolated... not a single city block in Oakland escaped Foreclosed Property... in some areas it was as if 20 years appreciation evaporated...

Where I previously lived the 1922 1100 square foot craftsman sold for 510k in 2007... in 2009 it sold for 100k... yes 100k and it had not been trashed and even had a new roof...


Thank the voters that came before me for making Prop 13 law as it then spared me the roller coaster ride of No Doc Loans with nothing or little down driving up a frenzy to buy only for many to walk...

[Ultrarunner]

Originally Posted by DougStark

The number of homes under Mello Roos is small? Give me some evidence, data. All of the new homes I looked at in suburban San Diego had that damn levy.

Did homeowners who bought 40 years ago have to pay a friggin Mello Roos? NO. That's why I said long time residents are living off the backs of new home buyers.

I live in Oakland California... home to 450,000 and Mello is unheard of here... most of the housing stock dates from the 1920's with some older and some newer... but this city was very much built out by 1960 as far as developer tract housing...

Same for many areas... like San Francisco, Berkeley... etc...

I am looking for a map for the Association of Realtors that showed Mello is very concentrated in areas of vast new tract housing...

It is not hard to figure as Mello was not even implemented until 1983...

The California legislature passed the Mello-Roos Community Facilities Act of 1982, which became law in January of 1983 (California Government Code Section 53311 et. seq.) This act allows local governments to establish a Mello-Roos special tax assessment district in a developing area to finance specific public facilities and services needed by that particular area. A Mello-Roos Community Facilities District (CFD) is initiated by either: (1) a written request signed by two members of the legislative body (local government or school district); (2) a petition signed by 10% of the eligible voters in the area; or (3) a petition signed by the landowners of 10% of the area in the proposed district.
The legislative body then adopts a resolution of intention to establish a CFD. Public hearings are held by the legislative body and written protests are reviewed. If adequate support for formation of the district is found at the hearings, the legislative body adopts a resolution of formation and an election is held. The formation of a Mello-Roos CFD has to be approved by two-thirds of the eligible voters or landowners in the proposed district. If less than 12 registered voters reside within the proposed district, the vote shall be held by the landowners only of the proposed district with each landowner having one vote per acre owned.

[NewbieHere]

Some new neighborhood in Bay Area and Orange County has no Mello Roos, but they sure jack up the price to make up for it, especially for SoCal.

[Ultrarunner]

Originally Posted by DougStark

Sorry, your logic makes no sense. Dismiss the decades of taxes paid by long-time residents? No one dismissed it--it was spent on teachers, police, parks, etc.

Plus, the new homeowner wouldn't be paying what the long term homeowner is paying---the prop tax would be based on the value of the home, whether it's old or new.

By definition... Real Estate is unique and this is why Specific Performance can be compelled in Real Estate Disputes.

Any valuation other than a Arms Length Sale is a guess... yes... a guestimate of value.

I have appealed values and always prevailed... but... it took years and all taxes billed must be paid in the interim...

The Appeal Process allows 2 years for the Appeals Board to hear the case... two years!

I don't know about the rest but having to spend one's life in a cycle of assessment appeal doesn't appeal to me...

Thankfully, Prop 13 has greatly reduced this... plus eliminated a lot of staff and the corruption found in the Assessor Offices... several went to prison for sweetheart deals and even suicides regarding corruption...

[Ultrarunner]

Originally Posted by CA4Now

But this is exactly what happened in the late 1970s before Prop 13 passed. People--and they were not all Grandpa and Grandma--were furious. That's why they called it the taxpayer's revolt. I remember that my parents, their friends, and all the neighbors we knew talked about escalating property taxes constantly.

Exactly... I was not old enough to vote but old enough to remember double digit tax increases during times of energy crisis, gas lines and job uncertainty...

Had the legislature chosen to lead a simple indexing of the basic Home Owner Exemption could have quashed Prop 13 support... but even this was too much.

[Ultrarunner]

Originally Posted by k374

your argument is totally illogical. In fact, you actually make the point. A car is in fact reassessed at current value, it just happens to be a depreciating asset. A home is appreciating and a homeowner participates in the increased worth hence an increase in the tax base using the new valuation.

Property does not always go up... sometimes it goes down dramatically and sometimes flat for years...

I walked by abandoned homes on my way to school in East Oakland as a kid... these homes were being offered for $1 to those willing to move in for 5 years and make improvements...

By the way... I have cars that appreciate... and have never lost money selling a car... mostly muscle and collector cars...

But even new cars go up... my former boss bought a brand new 2005 Ford GT off the dealer show room... kept it to 2011 and sold it for 50K MORE than he paid... that is right... paid 160k and sold it for 210K...

Let me assure his registration went down each year and not up on his appreciating vehicle...

[Ultrarunner]

Originally Posted by k374

No state in the union offers this type of Prop 13 system and they are all doing just fine, this is a bunch of baloney concocted by the Real Estate industry and disproportionately transfer burdens onto renters and newer residents.

Infact, Prop 13 was hugely opposed when it was created, ultimate the Real Estate lobbies won by creating a lot of fear mongering. It has hugely deprived local jurisdictions of desperately needed revenues, this is fact.

Variations spawned via Prop 13 such as Washington State I-747... later tossed by a single judge and property taxes increased 50% in one year in Thurston County... made me thankful California has Prop 13.

You are right... every public employee, politicians, unions, teachers, nurses, fire and police all campaigned against Prop 13 yet it prevailed...

In fact... Governor Brown has repeatedly said Prop 13 is settled law and who should know better as it happened under his watch.