March 26, 2021, 3:25 pm
As Proposition 19 officially goes into effect on April 1st, there are a few things you should know to help your clients take advantage of this expanded tax savings program.
Your clients may be able to buy and sell right now as long as the sale takes place on or after April 1st to obtain the tax savings under Prop 19. Freeing up inventory and allowing people to move more freely is one of the reasons Prop 19 passed so smoothly, ensuring California’s housing will benefit from removing restrictions on transferring property taxes. Aimed at supporting those most in need, Prop 19 targets people with severe disabilities, victims of wildfire and natural disasters, and homeowners age 55+.
Under Prop 19, seniors, retirees, and all homeowners aged 55+ can move closer to family, medical care, or to a home that better meets their needs anywhere in California without a tax penalty.
Prop 19 removed unfair location and price restrictions, allowing older homeowners to transfer the tax base of their home to a new home.*
Prop 19 also removed unfair restrictions on Californians with severe disabilities, allowing homeowners to move to a replacement home anywhere in California without a tax penalty.*
Under Prop 19, homeowners with severe disabilities can transfer the tax base of their existing home to a replacement home up to three times.
After wildfires destroyed more than 24,000 family homes in the past few years, wildfire victims have faced massive property tax hikes when relocating to another home.
Prop 19 allows victims of wildfire or natural disaster to transfer the property tax base of their damaged house to a replacement home anywhere in California.*
Millions of older homeowners feel trapped in homes that no longer meet their needs — they want to move to senior housing or retirement communities, or downsize to smaller homes. Prop 19 lets them move without a tax penalty.*
As more seniors take advantage of Prop 19’s tax savings, homeownership opportunities will open up each year for renters, young families, and first-time homebuyers in communities throughout California.
For more information, The California Association of Realtors® has created a website to answer any questions about the rollout of Proposition 19 and provide resources for you and your clients.
* With an adjustment upward in the tax basis if the replacement property is of greater value.