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This is important but not the only reason for Prop 13 which was also called a Taxpayer's Revolt.
Prop 13 came about just as much due to the Serrano Decision that allowed the State to dictate how public school money would be allocated.
It was one thing to pay higher property taxes to fund excellent local schools... quite another when local tax dollars leave the district.
Before Serrano... California Public Education was a model for the country...
A third and often overlooked feature of Prop 13 is it simplified real property taxation by repealing volumes of tax code and no longer would property owners be subject to the whims of the local county assessors and their OPINION of value...
Prop 13 is simply based on value at the time of transfer with a 2% annual inflation cap and voter approval requirement for additional assessments...
I was too young to have voted for Prop 13 and remain very thankful for the groundswell of California voters that made Prop 13 law against tremendous pressure from Sacramento...
Also... my community has strict rent controls and Just Cause Eviction Ordinance with renters as the sole beneficiaries...
Even higher ed; I remember when the UC system was great and free to in-state residents.
The solution is to make sure the government is using the property taxes properly not to continue to enable a decades long tax dodge. Audit the entire budget and see where the money is going and see if it really requires ~$3000/year/house average for taxes. If it shows that it needs less, great, allow EVERYONE to enjoy the lessened tax burden. If it's more then make everyone's taxes the same. I imagine that would make property's purchased in the last 10 years taxes drop to the tune of 50% and houses assessed in 1990 and before increasing 50%. That seems fair to me.
I believe inheritance to children and even grand children in certain situations avoids the reassessment of the value of the property. If anyone knows if a property in a trust gets reassessed or not then there is literally nothing preventing a family from passing down a property for hundreds of years.
You are probably thinking of Prop 58 and 193 that under some circumstances allow transfer without reassessment.
It is not automatic and must be applied for.
193 only works if the child is deceased and may allow a grandparent/grandchild transfer without reassessment.
I only know of one Prop 193 Assessment... an elderly grandmother lost her only child in the Vietnam and she has only one heir... her grandchild.
The home is old and falling down... yet it is in the SF Bay Area so it has some worth and neither knew of Prop 193 until I made them aware...
Only a fraction of eligible homes get handed down... siblings have their own priorities and not interested in co-owning property...
Sometimes I have seen one buy out the others... the last time it was 4 sisters... they were all married and the 3 older ones had nice homes and kids out of college or nearly so...
The youngest and her husband were renting... they bought out the other 3 sisters to 75% of the tax basis went to current market value and they retained 25% from her father... they now own a home.
FOR NOW. As you undoubtedly are well aware - and most people outside California are not aware - some people want to change that.
They do and have since the day voters made Prop 13 law...
Problem is California has constitutional provision against split roll assessments.
So if commercial property is subject to separate taxation... the constitution would need to be changed.
Then the real problems come in and many more government employees required.
What is a commercial property? What about mixed use? How will a determination or allocation be made.
Do you exempt property with beds... what about a home business???
As always, the Devil is in the details and these proposals are all giant step backwards... just another huge bureaucracy simply to deal with and guess property values...
I have never had to deal with rent increases that where hundreds of dollars more a month until I moved to the United States.
unregulated rent was never not a thing for me.
Living in a state where rent can be whatever it wants to be and where the uncharges every year typically exceed $200 for 2 bedrooms...I can see why so many find it hard to afford a place to stay and why homelessness is everywhere I look.
I know they all go to the current market pricing, but when you start paying more for an apartment to rent than it is to rent a small home...something isn't right.
I pay more for my apartment every year with bills included than I do for my small home in another country. That's just messed up.
And let's not forget how they get around Prop 13.......bonds. Just about every election there is another bond on the ballot that is either "for the children" or for emergency personnel.
The taxes on the condo that I lived in in California went from $2200 per year to $4800 per year twelve years later thanks to my fellow voters - owners and renters alike. My favorite were the renters that would tell me it didn't matter to them because they didn't pay property taxes.
Last edited by BitterlyHopeful; 10-11-2015 at 07:20 AM..
And let's not forget how they get around Prop 13.......bonds. Just about every election there is another bond on the ballot that is either "for the children" or for emergency personnel.
The taxes on the condo that I lived in in California went from $2200 per year to $4800 per year twelve years later thanks to my fellow voters - owners and renters alike. My favorite were the renters that would tell me it didn't matter to them because they didn't pay property taxes.
It would be more accurate for those renters to say it doesn't matter to them because LANDLORDS CHARGE WHAT THE MARKET WILL BEAR REGARDESS OF COSTS.
Rents did not fall after Prop 13 cut property taxes more than half, that is why many local rent controls were adopted.
And let's not forget how they get around Prop 13.......bonds. Just about every election there is another bond on the ballot that is either "for the children" or for emergency personnel.
The taxes on the condo that I lived in in California went from $2200 per year to $4800 per year twelve years later thanks to my fellow voters - owners and renters alike. My favorite were the renters that would tell me it didn't matter to them because they didn't pay property taxes.
yes, that is true but at least it is up to the people paying the tax to decide if they want to pay the tax. For bonds added to property tax, it requires either a 2/3 vote or 55% (school) majority to win. It is a bit more complicated as shown below. Point is, if people want to vote money for their area, they can. That is different than the government just shoving it down their throats. Also this way their Property Tax money stays in their district. And the trend has changed, these bonds used to win easily, not so anymore.
that is how investing your money works . would you sell apple stock for 1/2 the going price because you bought it for less ?
I invested my money with my landlord and he blew it on a tour of Asia!
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