Chic vs. Geek: Proposition 19

The votes have all been counted, and Prop 19 has officially passed. So what does that mean for homeowners – and homebuyers?

CHIC (PEARL)

Well, if you’re a homeowner over the age of 55, and you meet all of the qualifications (or you collect disability insurance), you’ll soon be eligible to sell your home and keep your property tax base rate if you move anywhere in California – and you could do this up to three times. Typically, if you buy a more expensive home, the difference in market value between the old and new homes is added to your base rate. Prop 19 will allow retired and “empty nest” Californians to move to more affordable markets without an additional property tax burden. That means more inventory for millennials and other homebuyers. Learn more about Prop 19.

GEEK (KEVIN)

Like any ballot measure, Prop 19 has its pros and cons, as well as unintended consequences. For example, it narrows the rules governing inherited properties so that a child or grandchild is required to use the home as a primary residence in order to avoid a property tax reassessment – unless the property is being used for farmland. Also, an inherited primary home or farm would see a property tax hike if the sale price exceeds the property’s taxable value by more than $1 million. If your family owns multiple properties in California, you should consult with a tax attorney or accountant. And contact me for a one-page guide!