Wonder what this will do for housing prices.

[expatCA]

Originally Posted by HereOnMars

Perhaps California should do what Canada is doing about the rising costs and short supply of homes. Foreign buyers are being charged a 15% tax on real estate purchases in parts of Canada. There seems to be some interest in this here in the U.S. Seattle is considering this as an option to curb what they are calling "rampant investment."

https://www.inman.com/2017/04/26/15-...n-real-estate/

When our own residents can't to keep up with the rising prices of real estate or aced out by a wealthy foreign buyer, it's time to start looking at alternatives to slow it down or at least reap some benefits from it. Besides, if the California budget is so strapped, this could be a way to pick up much needed money for their general fund.

Remember as housing prices rise, so do the County/City Property taxes collected from them, so they do not want a drop.

[CaliRestoration]

Originally Posted by AlongTheI-5

At least Gore would have been better than Bush. Under Bush's watch, California real estate values nosedived. A lot of people were underwater.

Well Bush did the best he could to cope with Bill Clinton's deregulation of derivatives which caused the entire housing bubble in the first place. But that train hit full steam ahead by Bush's second term, and Clinton's folly destroyed the housing market and caused a huge economic collapse.

[JGC97]

Originally Posted by expatCA

Remember as housing prices rise, so do the County/City Property taxes collected from them, so they do not want a drop.

I understand that. Something to remember, though. When the RE market crashed, there were investors scooping up foreclosures for very little, setting a new base tax rate. When Prop 13 provisions allow a cap of only 2% annually, it will take quite a while to recoup the $$ lost before the 2005 peak. With a 15% tax on foreign investors, they'd see a somewhat of an increase in revenue.

Last night, on my local tv news station, there was a report on how many millennials are leaving the state because they can't afford to buy in California and they want to have a home like their parents did. I can see their point. First time home buyers are just unable to get into a house because someone else comes along with a boatload of money and willing to pay cash. And, when prices creep up continually month after month, you just can't reach the goal line. I can't really fault sellers for choosing the one who has the most money but I still understand how frustrating it must be for the younger generation.

[expatCA]

Originally Posted by HereOnMars

I understand that. Something to remember, though. When the RE market crashed, there were investors scooping up foreclosures for very little, setting a new base tax rate. When Prop 13 provisions allow a cap of only 2% annually, it will take quite a while to recoup the $$ lost before the 2005 peak. With a 15% tax on foreign investors, they'd see a somewhat of an increase in revenue.

Last night, on my local tv news station, there was a report on how many millennials are leaving the state because they can't afford to buy in California and they want to have a home like their parents did. I can see their point. First time home buyers are just unable to get into a house because someone else comes along with a boatload of money and willing to pay cash. And, when prices creep up continually month after month, you just can't reach the goal line. I can't really fault sellers for choosing the one who has the most money but I still understand how frustrating it must be for the younger generation.

I agree with something like a surcharge on foreign buyers and potentially even investors in the case of a SFH. However it is unlikely to stop foreign buyers as the prices have gone up more than that in the last year or two and that has not stopped them.

[JGC97]

Originally Posted by expatCA

I agree with something like a surcharge on foreign buyers and potentially even investors in the case of a SFH. However it is unlikely to stop foreign buyers as the prices have gone up more than that in the last year or two and that has not stopped them.

You're right. It won't stop them. I don't even know if an additional tax on foreign investors will do much either. Until supply increases, demands won't be met. The only thing that makes it really bad is there is hardly any available land to build more homes along the coast. Nowhere to go but inland.

Last year, I think, a bill passed in California (or in the east bay) allowing homeowners to build additional structures on their lots. I guess you would call them a mother-in-law residence??? I just call them additional housing. In any event, the bill passed and now it's okay to do it. I keep thinking of all the ramifications of such a thing. Double the houses on a lot equates to double the traffic and parked cars on the street. 'Course, if you build it, they will come.

[expatCA]

Originally Posted by HereOnMars

You're right. It won't stop them. I don't even know if an additional tax on foreign investors will do much either. Until supply increases, demands won't be met. The only thing that makes it really bad is there is hardly any available land to build more homes along the coast. Nowhere to go but inland.

Last year, I think, a bill passed in California (or in the east bay) allowing homeowners to build additional structures on their lots. I guess you would call them a mother-in-law residence??? I just call them additional housing. In any event, the bill passed and now it's okay to do it. I keep thinking of all the ramifications of such a thing. Double the houses on a lot equates to double the traffic and parked cars on the street. 'Course, if you build it, they will come.

I believe either in SD County or Oceanside that law is in effect. Building a "mother in law" unit is acceptable. The problem is the high costs associated with permits. In fact a permit is required to replace a bad water heater.

[JGC97]

Ceiling fans too. Imagine that.