BG: Not everyone wants to be a landlord.
The decision of heirs to rent out rather than sell an inherited SFR depends upon a whole host of considerations. First, most heirs, especially if they are several, may have differing liquidity needs. They also face the question of managing the property, perhaps from afar, and dealing with all the headaches of landlording. SFRs are the least profitable of real estate categories from a cash flow standpoint. Yes, they may appreciate, but CA has had years-long episodes of depreciation at times, and having a tenant for a few years usually hurts the value.
Property taxes are only one of many expenses involved in making this investment decision, so it alone will not be the deciding factor.
BG, I agree with your opinion about the unfairness of the present laws. They grant an unearned tax break to an underserving population. This “subsidy” must be made up by other taxpayers.
But you have a tendency to jump to broad and unwarranted conclusions based on your own experiences in your particular older neighborhood. What’s needed are in-depth, unbiased, peer-reviewed studies of the total revenue loss due to these two Propositions.
