Prop. 13 Will Blunt the Property Tax Windfall as Boomers Transfer Property to Millennials
[Updated June 21, 2018] A new report from the California Legislative Analyst predicts that property tax revenue will grow as aging boomers leave the homeownership market. Still, transferring property ownership will lessen that new revenue to the tune of $1.5 billion a year.
A few key points from the recent report by the California Legislative Analysts Office, as explained in the summary:
- "California’s homeowners are getting older. In recent years, this has contributed to declining property sales and depressed property tax growth. As California’s homeowners continue to age, however, these patterns are likely to reverse."
- These potential future property tax gains could be lessened by an increase in transfers of homes from parents to children, which often are exempt from revaluations that trigger higher property tax payments.
- These parent-to-child exclusions have been a notable and consistent share of home transfers in recent years, currently reducing annual property tax revenues by around $1.5 billion statewide.
The report is included in its entirety on a post on the LAO's website, and includes a breakdown of the findings, organized by several key talking points, along with infographics and data to build and illustrate the case.