Interesting Article Posted After The Recent CAR Meeting
Written by my friend and Ethics Guru, San Clemente’s own wizard.
Realtors’ Tax Initiative Draws Opposition
Some months ago (October-November, 2017) we wrote that the directors of the California Association of Realtors® (CAR) had voted to support a signature drive with the intention of placing a CAR-sponsored initiative on the November 2018 California ballot.
The initiative, if passed, would allow “individuals 55 years of age and older to transfer their property tax basis to any home in the state, to purchase any price home, and to transfer their basis as many times as they wish.”
To appreciate the significance of this, it is necessary to have some idea of California’s property tax system. Property tax valuations are based on purchase price. You buy a house for $700,000, the assessor will value it at $700,000. After that, increases in property tax value are severely limited by formula. A home that was purchased for $500,000 five years ago could still be valued, for tax purposes, in the $500,000 range, even if its actual market value had increased to $700,000.