Prop 5: Home Value to Change for Owners 55 Plus
This proposition did not pass.
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What? | |
| Allows homebuyers 55 plus or older or severely disabled to take a portion of their lowered property tax base when they sell their house and move. | |
Why? | |
The California Association of Realtors wants to amend proposition 13 from 1978, which sharply limited property tax increases for homeowners who held onto their primary residence. | |
Vote Yes | Vote No
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| Supports a state statute and constitutional amendment that changes how tax assessments are transferred between properties for homebuyers who are age 55 plus or severely disabled. | Opposes a state statute and constitutional amendment that changes how tax assessments are transferred between properties for homebuyers who are age 55 plus or severely disabled. |
Follow-up initiatives to Proposition 13 were introduced in 1986 and 1988, which made it easier for older homeowners to move, for example if they needed to relocate or downsize, without a big property tax increase. Those over age 55 could transfer their home's taxable venue - once only - to a replacement home of equal or lesser value within the same county, or another county that participates in such transfers. The current initiative removes some of the transfer requirements but adds an adjustment for the new property's value.
If Proposition 5 is approved, homebuyers 55 or older or severely disabled could transfer the tax-assessed value from their prior home regardless of the new home's market value or location in California, and not just once. While the new home would not have to be of equal or lesser value, a formula would be imposed to adjust the new value up or down depending on whether it was a higher or lower market value.
Supporters contend that getting rid of the tax disincentive that keeps many seniors from moving would free up more affordable housing for young families. But state legislative analysts estimate that cities, counties and special districts would see property tax revenue fall about $150 million a year in the near term, growing over time to $1 billion or more per year in today's dollars. School districts would have similar losses, leading the California Teachers Association to oppose the initiative.
Click here for a printable version of all the propositions on the November ballot.
Data from Cal Access as of 10/30/18.
