Upcoming Real Estate Related California State Propositions | Bay Area Real Estate Tip #24
Every Tuesday, I go into detail about a question I frequently get asked. This week, I'm going to discuss the upcoming California Propositions related to real estate that will be on the ballot by giving my candid thoughts, pros and cons, and whether I think they will likely pass or not. The main ones I will be covering today are Proposition 15, 19, and 21.
Proposition 15: Increases funding sources for public schools, community colleges, and local government services by changing tax assessment of commercial and industrial property. Initiative constitutional amendment.
What it means: Taxes such properties based on current market value, instead of purchase price.
Fiscal Impact: Increased property taxes on commercial properties worth more than $3 million providing $6.5 billion to $11.5 billion in new funding to local governments and schools.
Proposition 19: Changes certain property tax rules. Legislative constitutional amendment.
What it means: Allows homeowners who are over 55, disabled, or wildfire/disaster victims to transfer primary residence’s tax base to replacement residence. Changes taxation of family-property transfers. Establishes fire protection services fund. Fiscal Impact: Local governments could gain tens of millions of dollars of property tax revenue per year, probably growing over time to a few hundred million dollars per year. Schools could receive similar property tax gains.
Proposition 21: Expands local governments' authority to enact rent control on residential property. Initiative statute.
What it means: Allows local governments to establish rent control on residential properties over 15 years old. Local limits on rate increases may differ from statewide limit.
Fiscal Impact: Overall, a potential reduction in state and local revenues in the high tens of millions of dollars per year over time. Depending on actions by local communities, revenue losses could be less or more.
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Born and raised in the Bay Area, I spent 11 years as an Enterprise Sales Manager before becoming the Tech Realtor of the Bay Area. Having the background as a homeowner, investor, and renovator, I leverage data and insights to help all of my clients gain a competitive advantage with their real estate journey. Communication is key for me so as long as I'm awake, you will get a reply from me. I have helped 23 families within the last 12 months for over $27MM in delighted transactions and I look forward to help you too.
Spencer Hsu, MBA Tech Realtor
EXP Realty DRE #02077253