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Old 08-22-2008, 05:53 AM
 
Location: Malibu/Miami Beach
1,069 posts, read 3,271,197 times
Reputation: 443

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A friend of mine has just gone back to England after a short vacation. The reason for the vacation was a job interview for the post of Consultant Anesthetist(Anesthesiologist) in a top LA Hospital.
The hospital let her know that she was successful within three days and as you can imagine she was filled with excitement at the thought of starting a new life in California. Especially as she has just gone through a divorce the idea of setting up in a new place with her eight year old daughter was very appealing.
You would think this would be simple,sell one house buy another and move on with her life,not so.
She owns outright (inherited from parents)a house in a very smart area of St Johns Wood (London) current value around £5 Million nothing extraordinary for London and wants to buy a house of similar value here in California,we even drove around and looked at a couple in Malibu with tennis court,pool and a sea view.
Until she understood that the Property tax on this house would be over $100,000 per year this equates to around one third of her new salary.
How ridiculous is that a professional who would be an enormous asset to California is prevented from buying the house she can afford (no mortgage) by stupid property tax laws.
Until I thought about this situation I had never realized how anti wealth California actually is.
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Old 08-22-2008, 06:05 AM
 
4,183 posts, read 6,522,118 times
Reputation: 1734
How much property taxes is she paying in London?
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Old 08-22-2008, 06:52 AM
 
Location: Malibu/Miami Beach
1,069 posts, read 3,271,197 times
Reputation: 443
Quote:
Originally Posted by ndfmnlf View Post
How much property taxes is she paying in London?
About $5000 per year.
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Old 08-22-2008, 08:42 AM
 
Location: Hot Springs, AR
5,612 posts, read 15,110,658 times
Reputation: 3787
One third is about what she would pay for rent, but it's still ridiculous. My suggestion to her would be buy the house and mortgage half of it, then buy an apartment building under the same circumstances, and let the tenants pay for both.
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Old 08-22-2008, 08:43 AM
 
4,183 posts, read 6,522,118 times
Reputation: 1734
$100K on a $9.2 million house is a property tax rate of 1%. In Illinois, the property tax rates range from 2 to 3%. So she'd be paying $200K to $300K if she moved to Chicago.

Property Tax Rate (http://www.retirementliving.com/RLpropertytaxrate.html - broken link)
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Old 08-22-2008, 10:22 AM
 
Location: Los Angeles, CA
236 posts, read 789,099 times
Reputation: 106
Quote:
Originally Posted by impala666 View Post
Until I thought about this situation I had never realized how anti wealth California actually is.
I agree wholeheartedly. There are a lot of wonderful things about California, but this is the ultimate reason I have a plan in place to move out in the next few years. While not an anesthesiologist, I certainly make enough money to live like royalty in other desirable areas of the country in comparison to here.
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Old 08-22-2008, 10:29 AM
 
11,715 posts, read 40,438,984 times
Reputation: 7586
Does she really need to buy a $9.2M house? Can't she slum it in a little $3M house, invest the difference, and earn enough off the investments to pay the property tax?
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Old 08-22-2008, 10:40 AM
 
Location: Mission Viejo, CA
2,498 posts, read 11,434,862 times
Reputation: 1619
Quote:
Originally Posted by EscapeCalifornia View Post
Does she really need to buy a $9.2M house? Can't she slum it in a little $3M house, invest the difference, and earn enough off the investments to pay the property tax?
I know, a $3 million dollar home is still VERY nice in LA and she can use the difference from buying a $9 mil home to cover the property tax.
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Old 08-22-2008, 10:44 AM
 
Location: West LA
2,318 posts, read 7,842,045 times
Reputation: 1125
Quote:
Originally Posted by EscapeCalifornia View Post
Does she really need to buy a $9.2M house? Can't she slum it in a little $3M house, invest the difference, and earn enough off the investments to pay the property tax?
Enough with the logical pragmatic comments! You just don't understand...

Won't her income taxes be lower in the US than the UK? Not to mention the tax deduction she'll get from those property taxes she pays... I'm not sure if you guys are looking at the big picture financially.
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Old 08-22-2008, 10:48 AM
 
Location: South Bay
7,226 posts, read 22,187,529 times
Reputation: 3626
Quote:
Originally Posted by impala666 View Post
How ridiculous is that a professional who would be an enormous asset to California is prevented from buying the house she can afford (no mortgage) by stupid property tax laws.
What about all the people that have a hard time paying their property taxes on half million dollar homes. everyone has to pay the piper!

anyways, not only will the property tax being over $100k, I don't even want to think about what the upkeep on a house like that would cost. cleaning, landscaping, heating, a/c, water...that would probably be another $100k evey year. if she doesn't make enough to live there, maybe she should be looking at other homes.
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