By Kay Wilson-Bolton
June 13, 2007
Imagine yourself at age 75 and your health no longer permits you to live in your home in Ventura County.
Your adult children live in Santa Barbara County and you want to live near them, but not with them. Your home is worth $800,000 and is free and clear. Your tax base is about $1200 per year thanks to Proposition 13.
In order for you to live near your children in Santa Barbara County, you have to sell your home in Ventura County and pay cash for the new one.
Your tax base would go from $1200 a year to more than $8000 a year, if you can find a home for $800,000—because the average price in Santa Barbara is $1,000,000.
A great way to create housing in Ventura County came to light last week when 800 REALTORS® from around the State gathered in Sacramento to debate some tough issues.
One of them was to insure the life of Prop 60 and Prop 90 which allow homeowners over 55 years of age to transfer their property tax base to their new home, as long as their purchase is not more than 105% of their sale price and the County in which their new home is located accepts the transfer.
Ironically, Prop. 13 was approved in 1978 to help senior citizens (55 and over) to keep their homes without being priced out by ever rising assessments and property taxes.
It now appears that this same measure is trapping seniors in their homes because they can not afford to buy another even though it means moving closer to the people who might well make the difference in the rest of their lives.
The resistance is coming from local taxing entity authorities. Numerous counties across the State have dropped out of the acceptance of tax bases from other counties because of the negative financial impact.
One of the major issues on the agenda of California REALTORS® is housing opportunities. It is easy to see how the sale of one home creates home ownership opportunity for another.
The State Legislature seems to have sympathy for allowing seniors to transfer their property tax basis to any county to which they may choose to move.
As always, the ultimate test will be the cost to government in lost property taxes. However, there may be a neutral event if the home being sold with a tax basis of $1200 per year can be sold with an elevated tax basis.
So far, the Supervisors of Ventura County view this tax base issue as neutral and, we thank them.
The California Association of REALTORS® will conduct a survey with necessary computer modeling, to insure that there is at least a “revenue neutral” for every county in California. We voted last week to spend $20,000 to find out.
It will eventually mean something to each of us, at some point in time.
Many REALTORS® are on the front line of diverse and important issues. They range from property taxes to gravel trucks on narrow, scenic highways to private transfer taxes. So, if you don’t get us with the first call, leave a message. We will call you back.
Kay Wilson-Bolton is the owner of CENTURY 21 Buena Vista and CENTURY 21 Ability. She brings a regional perspective to local issues. She can be reached at 805.340.5025. Her web address is www.readysetkay.com