Wednesday, October 18, 2017

California Prop 13 Distortion

Everyone has an opinion about Prop 13.  Most are based upon misinformation.  This however is likely to confirm the worst opinions of the detractors.


1667 Sparrow Rd, Wrightwood, CA 92397

2 beds 2 baths 1,375 sqft

For Sale
$980,000
Zestimate®: $344,361 


A truly historic property, the first ranger station in Wrightwood built in 1801. Owned part of history, this whole CEDAR LOG cabin with 2 bedroom 2 baths home nestled in Wrightwood mountain on a 53,000 square foot lot and the adjacent lot a 77,000 square foot lot, a total of 2.98 acres. A massive rock fireplace in the center of the living room welcomes all who enters. In 1924, the back wing was built logs were used from horse corral. An extra large porch of off the front door large enough to wine and dine your guests. This nostalgic home has extensive wood work throughout for example the cabinets down the hallway, the front door and other features of the house. The driveway walls leading to the house, part of the house's walls and landscape curbing are made up of a beautiful rock masonry. Adjacent lot 18 is included.  
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YearProperty taxesChangeTax assessmentChange
2016$391--$29,316+1.5%
2015$391+1.0%$28,875+2.0%
2014$387--$28,310+0.5%


 3 acres plus a cabin paying $391 per year in property taxes asking near a million dollars for sale.  If it sells the new owner will face $10,000 per year in property taxes.  

60 comments:

Rob Dawg said...

My dayghter’s SO is in the fire zone doing his part. Not fighting the fires but keeping society from collapsing. When so much burned and so many evacuated the supply lines are stretched. He is “deployed” managing a grocery store. That means the locals don’t go hungry. The firefighters get fed. Paychecks keep coming. Diapers. Medicine. The Home Depot can stay open because their employees have what they need. The fuel tankers can make gas station deliveries. Of course there isn’t an available room anywhere. Too much displacement. He’s on a couch at a coworkers apartment.

Rob Dawg said...

My Wilson fire is less threatening. Helos used night vision drops overnight.

Two new fires along the 57 freeway LA/OC county line.

Lawyerliz said...

There will be immense amounts of money spent on fixing up Houston and Florida and california. And many people will be employed to do so. This may accutally increase the velocity of money. Also. The new employees will spend money and build real things and we will be less financalized. Puerto Rico will get some dregs, which will do the same thing. So another Great Recession will be delayed another couple three years, imo, if Trump doesn't blow up the world. And oI also think the hideousness of his rudeness and nastiness may I spire the rest of us to be nicer and mire polite.
An opposite effect.

Lawyerliz said...

AND the money will be spent in the US.

Lawyerliz said...

Will people rebuild? I waited 6 months to see if my neighborhood would be rebuilt. It was.

Lawyerliz said...

I wonder how quickly the insurance companies will send the checks out. Will the burned out get their taxes reduced? It seems a few might take the money and run. The insurance company gave me and neighbor trailers to live in while our houses were rebuilt and to us 5k$ to tide us over. I guess the burnt out stI'll have driver's licenses to prove who they are. I know they are busy, but shouldn't someone be hauling away dead brush front some distance from unburned houses. And work their way outward. Or bull doze it into the ground, or whatever?

Lawyerliz said...

A million bucks for that pos? Surely in not just low taxes? Why not increase. Taxes gradually 2 or 3% a year maxing out at the real value whatever that is. If it ever does. They are only in ceasing at. Closing. Florida had that problem and invented homestead portability, which I don't know about since shortly afterward prices dropped like a bomb.

Lawyerliz said...

Increasing at closing?

Rob Dawg said...

Yes $400/year now. Per year. Upon resale $900/month. Per month.

Rob Dawg said...

Prop 13 does exactly as you suggest. +2% per year.

LBD said...

Good Morning!

Back home colder and day light shorter. Should have stayed in Lake Havasu.

Kali will have tax problems when the bills come due and the structure/improvement tax is gone. I guess a raise in taxes elsewhere will be needed. They never lowered them after the mortgage mess did they?

Prop 13 in basic idea is great. IMO

Lawyerliz said...

Well then 4%, whatever works. You really can't raise them to where they should be without causing a major mess

Lawyerliz said...

Well, I guess no one will buy.

Unknown said...

Tx has homestead caps on tax increases of 10% annually. every year they try to raise mine by the full 10%. I'm not using 10% more city resources, who am I subsidizing? My taxes go up just because my new neighbors were willing to pay more for the house next door.

Lawyerliz said...

10% wow.
Fla counties actually reduced taxes on a few poor souls whose house valued dropped like a bomb.

Cinco-X said...

Favorite topic!? This post isn't about beer...🤔

LBD said...

Whole problem goes back to Bankster slavery. House are no longer judged for what they are but what can we lend and out run the loss. They couldn't out run the loss last time it all went BOOM! We have learned nothing. Well some of us have and practice tax avoidance as much as I can.

LBD said...

By the way Bio Diesel is garbage. Lost more than a mile per gallon, pennies less then real diesel.

Rob Dawg said...

It is your duty as a freedom loving American to minimize your tax bill.

And yes biodiesel is nothing but virtue signaling and smelling like French fries. It should cost 10-15% less not pennies.

Enough about these side issues. The Octoberfest and Honey Lager are both ready to drink. I truly messed up the priming sugar content. Way too fizzy.

Unknown said...

HGTV on in the background of a restraunt. They are remodeling a kitchen and the host starts by taking a 10 lb sledge to the granite countertop. no thought of reusing/reselling.

Cinco-X said...

It's a bargain if you have a free source of the raw material such as fry-a-lator oil and are willing to process it yourself. Otherwise, no...

Cinco-X said...

No mocha-pumpkin-latte beer this year!?

Rob Dawg said...

The Garden Shed of Spousal Exile has marble counter tops. The home improvement store had them cheaper than formica and minimizes the dangers from my tendency to use chemicals and heat and leaving soldering irons on.

You are correct. All those shows have demo days when stuff that could have gone to Habitat for Humanity gets smashed for ratings.

Rob Dawg said...

PUMPKIN!?!

https://www.eater.com/2017/9/5/16233866/pumpkin-spice-trends-survey

Overdose.

Encinitas Undercover said...

Prop 13 obviously distorts incentives. It encourages buying one house and never moving.

That said, it's still a good thing. Certainty about future property taxes is peace of mind in retirement, and I might not have ever bought Calif property without that.

Rob Dawg said...

Prop 13 also restrains government from exploiting a captive taxpayer source.

The one "change" I would push is commercial change of ownership reassessments. A publicly traded company pretty much changes hands every year or two. The property values should be adjusted similarly.

LBD said...

Commercial property should be reaccessed every 5 years and or transfer of major controlling stock holder.

Prop 13 doesn't need senior discount either saving more government headache and hopefully tax payer money.

sm_landlord said...

> Prop 13 also restrains government from exploiting a captive taxpayer source.

Yes, but unfortunately it hasn't held the state or local governments back from sucking additional blood from the economy for their schemes. Sales taxes have gone crazy, state income taxes are excessive, and the fees for everything from utility service to trash collection have skyrocketed.

In SM, residents now pay a 10% surcharge on their electric, gas, telephone, internet, and cable TV bills.

And now Los Angeles has doubled the cost of trash collection by establishing city-wide franchises and destroying competition. The city-wide franchise scheme is much-loved by politicians because it generates large kickbacks to political campaigns from the franchisees.

In retrospect, it might have been better to pass a constitutional limit on the percentage of state GDP that the various levels of government can consume.

Rob Dawg said...

I wish Tom Stone weren't so busy. He has a great explanation of Props 58(?) and 90. One time transfer of cost basis for older homeowners. It frees up houses for younger tenants. Without them some neighborhoods like mine would be eldercare couples in 4000 sf family houses.

Lawyerliz said...

Alas, never happen.

Unknown said...

if you set a cap then you make every city feel like it's losing a benefit by not spending up to the cap.

Rob Dawg said...

Hey sm_r. The Lochnagar single malt is really nice. That's the distillery just past Ballmoral Castle were the queen was staying.

Yes, we need a "Prop 13" for the other ways of blood sucking by government. Remember free tuition?

Rob Dawg said...

Curiosity. How is Reddit HCN doing?

sm_landlord said...

Free tuition, LOL. That certainly obviated the need for student loans, eh?

Meanwhile, will you take some Zin in trade for a bit of that Lochnagar?


Cinco-X said...

Meh... Kinda boring, when it isn't irritating. Too bad Outsider won't make the jump

Rob Dawg said...

I am mildly wounded. We just need to get together for some free tasting. No need to make it a transaction. Glad to share with someone who appreciates. Besides when Cinco was here he paid for the beers at Institution Ale. What goes around and all that.

Rob Dawg said...

Yeah she would be a welcome perspective and Liz would like it too.

Cinco-X said...

Hey... Thanks for taking the time to show us around...

Rob Dawg said...

A random thought. The crash won’t be off a new high but in failing to make a new high.

Lawyerliz said...

Nah.

Lawyerliz said...

Fires and hurricane spendING will keep the economy for quite a long time, imo.

Rob Dawg said...

$2m homes burned down can be $2m homes again by spending $400k. I don’t expect much stimulus.

Rob Dawg said...

Eats suggestion. Riced cauliflower tastes better than rice and is better for you.

LBD said...

So the property tax is $1.6M for dirt, utilities and cement slab. Some how I don't think the owners will except that.

Lawyerliz said...

You can challenge tax assessments in Floridah, and many do, can't you challenge them in Kali?

LBD said...

What do you challenge? Expensive dirt or expensive structure?

Lawyerliz said...

Either or both. You have to prove your case. An appraiser. Nearby cheap houses. Total destruction is pretty convincing

EngineerJim said...

You can challenge assessments in CA also.
But you have to have a good case.

Lawyerliz said...

Total detruction is a pretty good case, I think.

Lawyerliz said...

My frind won. She had a smallish house between 2 big identical houses. All assessed the same. Clearly an error she said and won.

Lawyerliz said...

Who's responsible for sexual harassment? Ugly males!!!!
Look at Weinstein, Trump and Ailes.

LBD said...

Good Morning!

I am sure they will get consideration for loss of the improvement. Here we are taxed on the land and the improvement separately.

Cinco-X said...

Hmmm... All rich and/or powerful... You saying women don't like that?

Cinco-X said...

Oh... And where's Bill Clinton on that list?

Rob Dawg said...

In CA you can request an adjustment for any darned reason not just good ones. I actually am partly responsible for averting a crisis during the bubble popping. The board would have been overwhelmed so I suggested in the right ears that a modest auto adjustment down weighted towards more recent purchases was in order. They did that and still had to add a second appeals board. Almost always the matter is resolved at the counter. A couple pictures with circles and arrows with a paragraph on the back or just a workorder and receipts will do it. The board ends up with the tough ones like the depreciated land value basis for a parking lot that is designated a storm water retention pond or the consequences of an underground easement that was not documented.

Lawyerliz said...

Yeah, that's why Melania looks so unhappy all the time. Hell would freeze over before I had anything to do with him. Surely he could afford a good plastic surgeon to do something about his jowls?

Rob Dawg said...

A few Pict engravings by request new post.

Lawyerliz said...

Ailes that is. W. too. Trump's problem is his sneaky nasty eyes.

EngineerJim said...

>Oh... And where's Bill Clinton on that list?

LL said ugly males.
Bill Clinton was considered attractive -- at least in his younger days.
So sexual harassment was ok.

Cinco-X said...

Trump in his younger days too... Just about everyone is more attractive when they're younger