What will the repeal of Prop 13 do to the market?

[bearishgurl]

[quote=peterb]Prop 13 is unfair as two homes within feet of eachother can have two vastly different tax payments. The recent buyers carry the tax load, while the people that have been “enjoying” the same govt services for decades pay far less. Govt services are not a capital investment to be enjoyed over the years. They are on-going costs that must be paid every month.

This may put downward pressure on home prices as the threat of rising property taxes may scare home buyers. If the law was structured that way.[/quote]

peterb, I don’t see prices rising if Prop 13 and its progeny were repealed in part to omit the “pass-thru” within families of a =<1978 property assessment + 2% per year. I just see a little more inventory being marketed.

I really have no problem with the "1% of assessed value" portion of Prop 13 (+ City/County svcs fees). What I have a problem with is that this ultra-low assessment doesn't die with the =<1978 homeowner. As it stands, my "boomer" neighbors on either side of me could each leave their "inherited" home with its subsequent "inherited" assessment to any of their six children between them, currently aged 19-41!

If I'm still here after I retire, I fully expect to see one or more of my neighbors' children owning these properties if either of these "boomer" homeowners move in one of their children to care for them or predecease me. No, neither of these properties would be something these children would buy themselves or choose in an open market. But the artificially-low ASSESSMENT will be what keeps them there . . . for life, if this "loophole" is not closed. Then, while the 20 to 40-something “heir of an heir” is paying under $500K or under $900 annual property tax next door to me, my bill will be back up to $4000, when I’m on a “fixed income.”

As =<1978 original owners die, this law is no longer serving those it intended to protect, which was to keep the "over-65 fixed-income set" in their homes as long as possible. As the years pass, Prop 13 will only be "protecting" able-bodied persons of working age. How is this fair to "arms-length" market purchasers??

[Coronita]

[quote=Eugene][quote=SD Realtor]I think that it is very telling that those in power view the solution to be increasing tax revenue rather then decreasing spending.

Lets all be honest here, do we really think that increasing tax revenues to the state will benefit in the long run? Sure the increased revenues will help reduce the current state budget woes but will it cure the disease? Didn’t we JUST have a state income tax increase?[/quote]

Didn’t we also cut spending across the board at least three years in a row?

There’s not much room to reduce spending even further, unless you want to compete with Texas for the largest percentage of poor people without health insurance (cut Medi-Cal), with Mississippi for the lowest K-12 spending per pupil and lowest school test scores (cut K-12), or to dismantle/cripple/cut loose the best public university system in the country (cut UC subsidies).[/quote]

Perhaps the problem is just that. CA can’t afford to house so many people who can’ sustain themselves. Maybe CA needs to do what private sector has been doing for a long time. Downsize…..That and short of cutting pensions…..The choices seem pretty obvious to me…Continue to reduce and make crappier service for everyone or stop providing service to everyone to keep current level of services…Can’t have it both ways.

[Coronita]

[quote=Eugene][quote=SD Realtor]I think that it is very telling that those in power view the solution to be increasing tax revenue rather then decreasing spending.

Lets all be honest here, do we really think that increasing tax revenues to the state will benefit in the long run? Sure the increased revenues will help reduce the current state budget woes but will it cure the disease? Didn’t we JUST have a state income tax increase?[/quote]

Didn’t we also cut spending across the board at least three years in a row?

There’s not much room to reduce spending even further, unless you want to compete with Texas for the largest percentage of poor people without health insurance (cut Medi-Cal), with Mississippi for the lowest K-12 spending per pupil and lowest school test scores (cut K-12), or to dismantle/cripple/cut loose the best public university system in the country (cut UC subsidies).[/quote]

Perhaps the problem is just that. CA can’t afford to house so many people who can’ sustain themselves. Maybe CA needs to do what private sector has been doing for a long time. Downsize…..That and short of cutting pensions…..The choices seem pretty obvious to me…Continue to reduce and make crappier service for everyone or stop providing service to everyone to keep current level of services…Can’t have it both ways.

[Coronita]

[quote=Eugene][quote=SD Realtor]I think that it is very telling that those in power view the solution to be increasing tax revenue rather then decreasing spending.

Lets all be honest here, do we really think that increasing tax revenues to the state will benefit in the long run? Sure the increased revenues will help reduce the current state budget woes but will it cure the disease? Didn’t we JUST have a state income tax increase?[/quote]

Didn’t we also cut spending across the board at least three years in a row?

There’s not much room to reduce spending even further, unless you want to compete with Texas for the largest percentage of poor people without health insurance (cut Medi-Cal), with Mississippi for the lowest K-12 spending per pupil and lowest school test scores (cut K-12), or to dismantle/cripple/cut loose the best public university system in the country (cut UC subsidies).[/quote]

Perhaps the problem is just that. CA can’t afford to house so many people who can’ sustain themselves. Maybe CA needs to do what private sector has been doing for a long time. Downsize…..That and short of cutting pensions…..The choices seem pretty obvious to me…Continue to reduce and make crappier service for everyone or stop providing service to everyone to keep current level of services…Can’t have it both ways.

[Coronita]

[quote=Eugene][quote=SD Realtor]I think that it is very telling that those in power view the solution to be increasing tax revenue rather then decreasing spending.

Lets all be honest here, do we really think that increasing tax revenues to the state will benefit in the long run? Sure the increased revenues will help reduce the current state budget woes but will it cure the disease? Didn’t we JUST have a state income tax increase?[/quote]

Didn’t we also cut spending across the board at least three years in a row?

There’s not much room to reduce spending even further, unless you want to compete with Texas for the largest percentage of poor people without health insurance (cut Medi-Cal), with Mississippi for the lowest K-12 spending per pupil and lowest school test scores (cut K-12), or to dismantle/cripple/cut loose the best public university system in the country (cut UC subsidies).[/quote]

Perhaps the problem is just that. CA can’t afford to house so many people who can’ sustain themselves. Maybe CA needs to do what private sector has been doing for a long time. Downsize…..That and short of cutting pensions…..The choices seem pretty obvious to me…Continue to reduce and make crappier service for everyone or stop providing service to everyone to keep current level of services…Can’t have it both ways.

[Coronita]

[quote=Eugene][quote=SD Realtor]I think that it is very telling that those in power view the solution to be increasing tax revenue rather then decreasing spending.

Lets all be honest here, do we really think that increasing tax revenues to the state will benefit in the long run? Sure the increased revenues will help reduce the current state budget woes but will it cure the disease? Didn’t we JUST have a state income tax increase?[/quote]

Didn’t we also cut spending across the board at least three years in a row?

There’s not much room to reduce spending even further, unless you want to compete with Texas for the largest percentage of poor people without health insurance (cut Medi-Cal), with Mississippi for the lowest K-12 spending per pupil and lowest school test scores (cut K-12), or to dismantle/cripple/cut loose the best public university system in the country (cut UC subsidies).[/quote]

Perhaps the problem is just that. CA can’t afford to house so many people who can’ sustain themselves. Maybe CA needs to do what private sector has been doing for a long time. Downsize…..That and short of cutting pensions…..The choices seem pretty obvious to me…Continue to reduce and make crappier service for everyone or stop providing service to everyone to keep current level of services…Can’t have it both ways.

[Coronita]

[quote=peterb]Prop 13 is unfair as two homes within feet of eachother can have two vastly different tax payments. The recent buyers carry the tax load, while the people that have been “enjoying” the same govt services for decades pay far less. Govt services are not a capital investment to be enjoyed over the years. They are on-going costs that must be paid every month.

This may put downward pressure on home prices as the threat of rising property taxes may scare home buyers. If the law was structured that way.[/quote]

Fair???? Fair is subjective….From people that aren’t existing home owners, the “fair” thing to do perhaps do everything possible to crater home prices (though personally, I don’t think it will). Once a homeowner, the “fair” thing to do is to keep prop 13.

I’m pretty confident that

1)People who are against prop 13 aren’t currently owners.

2)Once people who use to be against prop 13 own a home, they will more or less sing a completely different tune….

So again, I think any “fairness” argument is subjective imho..

Besides, it’s not like anyone who really buys a home these day are going to be seeing any sizeable appreciation over the next decade anyway. So how does this really play into the purchase decisions of folks over the next decade… I mean, most places probably aren’t going to see much appreciation…well, except maybe santee…..

And if I were a landlord, I’d just pass the cost on to my tenant…Because everyone else would do it too… (what, you thought landlords would just eat the extra cost???)

So the only thing repealing prop 13 is to screw those who, well stayed put, kept there costs in line, etc. You know, people who….kept their finances in check…Sound familiar????

Anyway, this isn’t going to happen. Because in california, we’ve learned that if we don’t like the outcome of a proposition or revision to a proposition, all we need to do is get a special interests group to sue the state, and have the judge overturn the results…I’m pretty confident that that “special interests group” would end up being the real estate industry, and existing homeowners, which sorry to say, I think outnumbers folks interested in overturning prop 13….

[Coronita]

[quote=peterb]Prop 13 is unfair as two homes within feet of eachother can have two vastly different tax payments. The recent buyers carry the tax load, while the people that have been “enjoying” the same govt services for decades pay far less. Govt services are not a capital investment to be enjoyed over the years. They are on-going costs that must be paid every month.

This may put downward pressure on home prices as the threat of rising property taxes may scare home buyers. If the law was structured that way.[/quote]

Fair???? Fair is subjective….From people that aren’t existing home owners, the “fair” thing to do perhaps do everything possible to crater home prices (though personally, I don’t think it will). Once a homeowner, the “fair” thing to do is to keep prop 13.

I’m pretty confident that

1)People who are against prop 13 aren’t currently owners.

2)Once people who use to be against prop 13 own a home, they will more or less sing a completely different tune….

So again, I think any “fairness” argument is subjective imho..

Besides, it’s not like anyone who really buys a home these day are going to be seeing any sizeable appreciation over the next decade anyway. So how does this really play into the purchase decisions of folks over the next decade… I mean, most places probably aren’t going to see much appreciation…well, except maybe santee…..

And if I were a landlord, I’d just pass the cost on to my tenant…Because everyone else would do it too… (what, you thought landlords would just eat the extra cost???)

So the only thing repealing prop 13 is to screw those who, well stayed put, kept there costs in line, etc. You know, people who….kept their finances in check…Sound familiar????

Anyway, this isn’t going to happen. Because in california, we’ve learned that if we don’t like the outcome of a proposition or revision to a proposition, all we need to do is get a special interests group to sue the state, and have the judge overturn the results…I’m pretty confident that that “special interests group” would end up being the real estate industry, and existing homeowners, which sorry to say, I think outnumbers folks interested in overturning prop 13….

[Coronita]

[quote=peterb]Prop 13 is unfair as two homes within feet of eachother can have two vastly different tax payments. The recent buyers carry the tax load, while the people that have been “enjoying” the same govt services for decades pay far less. Govt services are not a capital investment to be enjoyed over the years. They are on-going costs that must be paid every month.

This may put downward pressure on home prices as the threat of rising property taxes may scare home buyers. If the law was structured that way.[/quote]

Fair???? Fair is subjective….From people that aren’t existing home owners, the “fair” thing to do perhaps do everything possible to crater home prices (though personally, I don’t think it will). Once a homeowner, the “fair” thing to do is to keep prop 13.

I’m pretty confident that

1)People who are against prop 13 aren’t currently owners.

2)Once people who use to be against prop 13 own a home, they will more or less sing a completely different tune….

So again, I think any “fairness” argument is subjective imho..

Besides, it’s not like anyone who really buys a home these day are going to be seeing any sizeable appreciation over the next decade anyway. So how does this really play into the purchase decisions of folks over the next decade… I mean, most places probably aren’t going to see much appreciation…well, except maybe santee…..

And if I were a landlord, I’d just pass the cost on to my tenant…Because everyone else would do it too… (what, you thought landlords would just eat the extra cost???)

So the only thing repealing prop 13 is to screw those who, well stayed put, kept there costs in line, etc. You know, people who….kept their finances in check…Sound familiar????

Anyway, this isn’t going to happen. Because in california, we’ve learned that if we don’t like the outcome of a proposition or revision to a proposition, all we need to do is get a special interests group to sue the state, and have the judge overturn the results…I’m pretty confident that that “special interests group” would end up being the real estate industry, and existing homeowners, which sorry to say, I think outnumbers folks interested in overturning prop 13….

[Coronita]

[quote=peterb]Prop 13 is unfair as two homes within feet of eachother can have two vastly different tax payments. The recent buyers carry the tax load, while the people that have been “enjoying” the same govt services for decades pay far less. Govt services are not a capital investment to be enjoyed over the years. They are on-going costs that must be paid every month.

This may put downward pressure on home prices as the threat of rising property taxes may scare home buyers. If the law was structured that way.[/quote]

Fair???? Fair is subjective….From people that aren’t existing home owners, the “fair” thing to do perhaps do everything possible to crater home prices (though personally, I don’t think it will). Once a homeowner, the “fair” thing to do is to keep prop 13.

I’m pretty confident that

1)People who are against prop 13 aren’t currently owners.

2)Once people who use to be against prop 13 own a home, they will more or less sing a completely different tune….

So again, I think any “fairness” argument is subjective imho..

Besides, it’s not like anyone who really buys a home these day are going to be seeing any sizeable appreciation over the next decade anyway. So how does this really play into the purchase decisions of folks over the next decade… I mean, most places probably aren’t going to see much appreciation…well, except maybe santee…..

And if I were a landlord, I’d just pass the cost on to my tenant…Because everyone else would do it too… (what, you thought landlords would just eat the extra cost???)

So the only thing repealing prop 13 is to screw those who, well stayed put, kept there costs in line, etc. You know, people who….kept their finances in check…Sound familiar????

Anyway, this isn’t going to happen. Because in california, we’ve learned that if we don’t like the outcome of a proposition or revision to a proposition, all we need to do is get a special interests group to sue the state, and have the judge overturn the results…I’m pretty confident that that “special interests group” would end up being the real estate industry, and existing homeowners, which sorry to say, I think outnumbers folks interested in overturning prop 13….

[Coronita]

[quote=peterb]Prop 13 is unfair as two homes within feet of eachother can have two vastly different tax payments. The recent buyers carry the tax load, while the people that have been “enjoying” the same govt services for decades pay far less. Govt services are not a capital investment to be enjoyed over the years. They are on-going costs that must be paid every month.

This may put downward pressure on home prices as the threat of rising property taxes may scare home buyers. If the law was structured that way.[/quote]

Fair???? Fair is subjective….From people that aren’t existing home owners, the “fair” thing to do perhaps do everything possible to crater home prices (though personally, I don’t think it will). Once a homeowner, the “fair” thing to do is to keep prop 13.

I’m pretty confident that

1)People who are against prop 13 aren’t currently owners.

2)Once people who use to be against prop 13 own a home, they will more or less sing a completely different tune….

So again, I think any “fairness” argument is subjective imho..

Besides, it’s not like anyone who really buys a home these day are going to be seeing any sizeable appreciation over the next decade anyway. So how does this really play into the purchase decisions of folks over the next decade… I mean, most places probably aren’t going to see much appreciation…well, except maybe santee…..

And if I were a landlord, I’d just pass the cost on to my tenant…Because everyone else would do it too… (what, you thought landlords would just eat the extra cost???)

So the only thing repealing prop 13 is to screw those who, well stayed put, kept there costs in line, etc. You know, people who….kept their finances in check…Sound familiar????

Anyway, this isn’t going to happen. Because in california, we’ve learned that if we don’t like the outcome of a proposition or revision to a proposition, all we need to do is get a special interests group to sue the state, and have the judge overturn the results…I’m pretty confident that that “special interests group” would end up being the real estate industry, and existing homeowners, which sorry to say, I think outnumbers folks interested in overturning prop 13….

[bearishgurl]

[quote=SD Realtor]Yeah I know FLU. Obviously there are just so many of these wealthy old people around. They just flood the San Diego area. It also goes without saying that there are tons and tons of kids who have these homes from there old but not dead parents and are not paying the so called market rate property taxes.

It is almost laughable.

At least the opponents for prop 13 should argue other problems with it (as there are many) and they don’t have much to do with residential real estate.[/quote]

SDR, I did not intend to imply that these =<1978 homeowners were all "wealthy." Often the family home is their largest or only asset and they have two or more children who would be potential "heirs." What typically happens is that one heir buys the other heirs out of the property upon death of the last parent. If the =<1978 homeowner has not already transferred title to child(ren) prior to death, the "heirs" find a way for the property to stay in the family. One or more will take title and at least one will live there. Even if the property is NOT the kind of property that ANY of them would purchase, they keep it because of the permanent ultra-low assessment.

Typically, the only "estate sale" listings you see in SD County are properties in which the heirs have long ago relocated, have established themselves elsewhere and have no intentions to return to SD.

Edit: SDR, you must know that there is a WIDE chasm between the "so-called market rate" tax and the tax that =<1978 homeowners (or their "heirs") pay. The difference here is by no means "chump change" and my neighbors on either side of me enjoy all the same City services that I do.

It's patently unfair for "heirs" to enjoy this perk while incoming purchasers carry them with market-rate property tax payments.

[bearishgurl]

[quote=SD Realtor]Yeah I know FLU. Obviously there are just so many of these wealthy old people around. They just flood the San Diego area. It also goes without saying that there are tons and tons of kids who have these homes from there old but not dead parents and are not paying the so called market rate property taxes.

It is almost laughable.

At least the opponents for prop 13 should argue other problems with it (as there are many) and they don’t have much to do with residential real estate.[/quote]

SDR, I did not intend to imply that these =<1978 homeowners were all "wealthy." Often the family home is their largest or only asset and they have two or more children who would be potential "heirs." What typically happens is that one heir buys the other heirs out of the property upon death of the last parent. If the =<1978 homeowner has not already transferred title to child(ren) prior to death, the "heirs" find a way for the property to stay in the family. One or more will take title and at least one will live there. Even if the property is NOT the kind of property that ANY of them would purchase, they keep it because of the permanent ultra-low assessment.

Typically, the only "estate sale" listings you see in SD County are properties in which the heirs have long ago relocated, have established themselves elsewhere and have no intentions to return to SD.

Edit: SDR, you must know that there is a WIDE chasm between the "so-called market rate" tax and the tax that =<1978 homeowners (or their "heirs") pay. The difference here is by no means "chump change" and my neighbors on either side of me enjoy all the same City services that I do.

It's patently unfair for "heirs" to enjoy this perk while incoming purchasers carry them with market-rate property tax payments.

[bearishgurl]

[quote=SD Realtor]Yeah I know FLU. Obviously there are just so many of these wealthy old people around. They just flood the San Diego area. It also goes without saying that there are tons and tons of kids who have these homes from there old but not dead parents and are not paying the so called market rate property taxes.

It is almost laughable.

At least the opponents for prop 13 should argue other problems with it (as there are many) and they don’t have much to do with residential real estate.[/quote]

SDR, I did not intend to imply that these =<1978 homeowners were all "wealthy." Often the family home is their largest or only asset and they have two or more children who would be potential "heirs." What typically happens is that one heir buys the other heirs out of the property upon death of the last parent. If the =<1978 homeowner has not already transferred title to child(ren) prior to death, the "heirs" find a way for the property to stay in the family. One or more will take title and at least one will live there. Even if the property is NOT the kind of property that ANY of them would purchase, they keep it because of the permanent ultra-low assessment.

Typically, the only "estate sale" listings you see in SD County are properties in which the heirs have long ago relocated, have established themselves elsewhere and have no intentions to return to SD.

Edit: SDR, you must know that there is a WIDE chasm between the "so-called market rate" tax and the tax that =<1978 homeowners (or their "heirs") pay. The difference here is by no means "chump change" and my neighbors on either side of me enjoy all the same City services that I do.

It's patently unfair for "heirs" to enjoy this perk while incoming purchasers carry them with market-rate property tax payments.

[bearishgurl]

[quote=SD Realtor]Yeah I know FLU. Obviously there are just so many of these wealthy old people around. They just flood the San Diego area. It also goes without saying that there are tons and tons of kids who have these homes from there old but not dead parents and are not paying the so called market rate property taxes.

It is almost laughable.

At least the opponents for prop 13 should argue other problems with it (as there are many) and they don’t have much to do with residential real estate.[/quote]

SDR, I did not intend to imply that these =<1978 homeowners were all "wealthy." Often the family home is their largest or only asset and they have two or more children who would be potential "heirs." What typically happens is that one heir buys the other heirs out of the property upon death of the last parent. If the =<1978 homeowner has not already transferred title to child(ren) prior to death, the "heirs" find a way for the property to stay in the family. One or more will take title and at least one will live there. Even if the property is NOT the kind of property that ANY of them would purchase, they keep it because of the permanent ultra-low assessment.

Typically, the only "estate sale" listings you see in SD County are properties in which the heirs have long ago relocated, have established themselves elsewhere and have no intentions to return to SD.

Edit: SDR, you must know that there is a WIDE chasm between the "so-called market rate" tax and the tax that =<1978 homeowners (or their "heirs") pay. The difference here is by no means "chump change" and my neighbors on either side of me enjoy all the same City services that I do.

It's patently unfair for "heirs" to enjoy this perk while incoming purchasers carry them with market-rate property tax payments.

[Author]

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