How to keep your property taxes from going up when you move

As a homeowner, you may be aware of the numerous benefits that come with owning a property. One such benefit is the lower property tax rate that can save you a significant amount of money each year. However, when it comes time to sell your home, you may have been concerned about losing this advantageous tax rate. Thankfully, with the passing of Proposition 19, homeowners who are 55 and over can now take their lower property tax with them when they sell. In this blog post, we will explore how you can use Prop 19 to your advantage as a seller.

Prior to the passing of Prop 19, homeowners who were 55 or older could only transfer their current property tax rate to a new home if the new home was of equal or lesser value than the one being sold. This limitation often discouraged homeowners from selling and downsizing or relocating to a more suitable property. However, with the new changes brought by Prop 19, homeowners can now transfer their lower property tax rate to a new home regardless of its value, with some adjustments.

Under Prop 19, eligible homeowners can now purchase a new property anywhere in California and transfer the assessed value of their current home to the new property, even if the new property is of greater value. For example, if you currently own a property assessed at $500,000 but wish to purchase a new home assessed at $800,000, Prop 19 allows you to transfer your lower property tax rate based on the $500,000 assessment to the new property.

This new provision opens up opportunities for homeowners to choose a new property that better suits their needs without worrying about a significant increase in property taxes. It provides flexibility for empty nesters or retirees who may want to downsize their living space or move closer to family, friends, or desired amenities.

In addition to the benefits for homeowners aged 55 and over, Prop 19 also offers some advantages for individuals who have been affected by natural disasters. Homeowners who have experienced property damage due to wildfires or other disasters can now transfer their assessed value to a different property anywhere in California, regardless of the value or location. This is an exceptional provision that can greatly assist homeowners who have lost their homes and need to start anew.

It is important to note that Prop 19 went into effect on April 1, 2021. If you are considering selling your home and taking advantage of this new legislation, it is crucial to consult with a knowledgeable real estate agent or tax advisor to fully understand the implications and requirements. They can guide you through the process and ensure that you make the most of Prop 19.

In conclusion, Prop 19 has brought significant changes for homeowners aged 55 and over, allowing them to transfer their lower property tax rate when selling their homes. This newfound flexibility provides opportunities to downsize or relocate without the burden of increased property taxes. If you are considering taking advantage of Prop 19, seek professional guidance to navigate the process successfully. The passing of Prop 19 is undoubtedly a positive development for homeowners in California, offering more freedom and options for the next chapter in their lives.