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Old 09-23-2014, 11:56 PM
 
33,046 posts, read 22,164,366 times
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Quote:
Originally Posted by Malloric View Post
Renters benefit more from Prop 13 than homeowners. Ownership of rental properties turns over less frequently. The really big beneficiary is commercial. If you look at an older city like San Francisco, property tax revenue basically flipped. Commercial property taxes used to account for most of the revenue. Now its residential.

I'm confident rental properties turn over more frequently than owner-occupied homes in California; they do turn over more frequently than owner-occupied homes in the other 49 states.

Yes, I understand that commercial owners have placed their real property within separate corporations, and sell the corporation rather than the property, thereby allowing the buyer to keep Prop 13 basis because the property is still owned by the corp and thus has not changed ownership.

And there are some in CA who want to create a split roll or two-tiered property tax in order to address the 'abuse' of Prop 13 described above. Which would of course tax rental property in addition to the commercial property that was the intended target.
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Old 09-24-2014, 06:37 AM
 
15,742 posts, read 9,293,764 times
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Quote:
Originally Posted by freemkt View Post
I'm confident rental properties turn over more frequently than owner-occupied homes in California; they do turn over more frequently than owner-occupied homes in the other 49 states.

Yes, I understand that commercial owners have placed their real property within separate corporations, and sell the corporation rather than the property, thereby allowing the buyer to keep Prop 13 basis because the property is still owned by the corp and thus has not changed ownership.

And there are some in CA who want to create a split roll or two-tiered property tax in order to address the 'abuse' of Prop 13 described above. Which would of course tax rental property in addition to the commercial property that was the intended target.
Prove it.
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Old 09-24-2014, 09:08 AM
 
Location: Foot of the Rockies
87,102 posts, read 102,884,582 times
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^^I'm certain as well that rentals turn over more frequently than owner-occupied residences. I don't think anyone needs to post a link about that! I don't know about Cali having more turnover than all the other states; it most likely has more turnover than states like Pennsylvania where internal migration is small.
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Old 09-24-2014, 09:16 AM
 
26,596 posts, read 52,495,347 times
Reputation: 20473
Quote:
Originally Posted by freemkt View Post
Prop 13 supporters said people shouldn't be taxed out of their homes...if that is true, why is it okay to tax renters out of their homes?
Not an issue in my City... Oakland and many nearby communities have rent control, licensing, tenant hearing boards, etc. to address this.
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Old 09-24-2014, 09:20 AM
 
26,596 posts, read 52,495,347 times
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Originally Posted by jade408 View Post
This sums it up pretty well. http://economix.blogs.nytimes.com/20...ype=blogs&_r=0

Prop 13 gave the power of local decisions to Sacramento. We still have tobs of taxes, and it is almost regressive as we rely on sales and income taxes to fund our coffers.

There is a healthy balance between keeping property taxes reasonable and funding our givernment, but we crossed the line.
Prop 13 is the Statewide 1% property tax...

I'm a life long Oakland resident and my Property Tax is around 1.6%.

I have friends that live in Castro Valley and their rate is just a little over the State 1% rate.

Prop 13 lets the voters decide and at least in Oakland, the voters tend to be very generous...

Don't know what the ultimate answer is... other than the State had many opportunities to act prior to Prop 13 and did nothing.
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Old 09-24-2014, 09:23 AM
 
26,596 posts, read 52,495,347 times
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Quote:
Originally Posted by Malloric View Post
Yes, it's mostly just squeezing the balloon around. But if you're a landlord like ultra, that doesn't mean it isn't personally advantageous to you. California has one of the least regressive state tax systems in the country though due to its income tax, so I don't know that I can really get too excited about that part of it.
One of the biggest benefits of Prop 13 as I see it is Predictability and owning rental property in a rent controlled city the value of predictable property taxes is very important.

In addition the city collects an across the board Gross Receipts Tax on Rentals plus registration fees.
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Old 09-24-2014, 10:52 AM
 
2,388 posts, read 2,965,304 times
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Quote:
Originally Posted by darkeconomist View Post
I think you'll find, however, that the effects of Prop 13 have been largely negative.

The state has had to get much of its funding from more volatile, less predictable sources--which is why "California has just about every tax known and neighboring States don't".
I've never heard of a state that uses real property taxes as a funding mechanism. Counties, municipalities, school districts, etc. sure. I know that some states are talking about a statewide property taxes but I don't know of any that actually do it. It sounds very Georgist.

I'm not sure exactly how Prop 13 works but, to me, it would make sense to set the value of the house when it changes hands and from there peg it to inflation. If you live in your house for 20 years you can expect your taxes to go up 2.5% per year (or whatever it happens to be). If you sell it for $500k then the new people pay taxes based on $500k.
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Old 09-24-2014, 01:04 PM
 
2,553 posts, read 2,012,664 times
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Quote:
Originally Posted by drive carephilly View Post
I've never heard of a state that uses real property taxes as a funding mechanism. Counties, municipalities, school districts, etc. sure. I know that some states are talking about a statewide property taxes but I don't know of any that actually do it. It sounds very Georgist.

I'm not sure exactly how Prop 13 works but, to me, it would make sense to set the value of the house when it changes hands and from there peg it to inflation. If you live in your house for 20 years you can expect your taxes to go up 2.5% per year (or whatever it happens to be). If you sell it for $500k then the new people pay taxes based on $500k.
One problem is that, in California since 1978, home prices went from 5 digits to high 6 or low 7s. The mechanism failed to account for the price explosion.
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Old 09-24-2014, 02:25 PM
 
15,742 posts, read 9,293,764 times
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Quote:
Originally Posted by Katiana View Post
^^I'm certain as well that rentals turn over more frequently than owner-occupied residences. I don't think anyone needs to post a link about that! I don't know about Cali having more turnover than all the other states; it most likely has more turnover than states like Pennsylvania where internal migration is small.
Well, there you go. Two people are "sure" it's true, so it must be. No proof to back up claims at all. Alrighty then....
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Old 09-24-2014, 02:28 PM
 
15,742 posts, read 9,293,764 times
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Quote:
Originally Posted by drive carephilly View Post
I've never heard of a state that uses real property taxes as a funding mechanism. Counties, municipalities, school districts, etc. sure. I know that some states are talking about a statewide property taxes but I don't know of any that actually do it. It sounds very Georgist.

I'm not sure exactly how Prop 13 works but, to me, it would make sense to set the value of the house when it changes hands and from there peg it to inflation. If you live in your house for 20 years you can expect your taxes to go up 2.5% per year (or whatever it happens to be). If you sell it for $500k then the new people pay taxes based on $500k.
Makes no sense at all. Retirees would be the hardest hit, since their home's value would skyrocket, and their income drop. Who could plan for that in their retirement?

I wish states would exempt EVERYONE over a certain age from property taxes. If you are retired, you should own your home free and clear. Having to pay taxes means your property is never really your own.
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