I have not read much on this but CAR the California Association of Realtors is sponsoring SB 670 which will prevent the imposition of point of sale private transfer taxes. Again I do not know much about this but the association emails us updates on stuff like this and I try to stay informed but sadly am negligient at times.
From the email I got, apparently there is a loophole in California law that lets developers and other non-government entities impose private transfer taxes on homes every time that property is sold, with no oversight, no accountability and no limit on the number of seperate private transfer taxes that can be piled on a home. While the loophole has existed for awhile, some developers are now imposing them on developments in order to avoid potential lawsuits by environmental organizations or to pre-empt local government objections to the project. There is nothing in the current law that prevents the imposition of these taxes for private gain.
CAR is sponsoring SB670 to prohibit these private transfer taxes.
Now CAR goes on to say that
– The private tax can be as high as 1.75% of the sales price.
– The tax can be written into the deed so that it recurs whenever the home is resold
– CAR claims the tax does not add value to the property.
– CAR claims that the developers are calling these mitigation fees but CAR feels as if they are taxes, that do not benefit homeowners.
– CAR believes 1.75% is the limit but ANYONE selling the home is free to add a private transfer tax.
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I don’t know if this is all true or not but if it is then you can urge your state Senator to vote yes on SB 670.
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I have not studied SB 670 yet but I thought this may interest the board.
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