r/dataisbeautiful • u/Infamous_Echo_5683 OC: 3 • Sep 01 '26
OC [OC] A 1.29-acre house in Los Angeles pays more property tax than the 308-acre country club across the street
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u/trackdaybruh Sep 01 '26
For those that don't know, California property tax taxes you based on the value you BOUGHT the property at. It's not based on the current market value that is reassessed every year.
So if you bought a Californian house for $100,000 and then 20 years later that same house is now worth $2 million, you are still only paying the tax based on the $100,000. This is dumbed down version of it, there is a 2% maximum limit increase in the tax adjusted, but that amount is small.
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u/blizardfires Sep 01 '26
This also true about non-residential (aka corporate) property which was a ridiculous insertion by moneyed interests when it was pushed for decades ago.
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u/Kruger_Smoothing Sep 02 '26
And the commercial LLC loophole can prevent reassessment even if a sale occurs. You put the property in an LLC, and instead of selling the property you sell membership interests in the LLC, just make sure no single buyer ends up with more than 50%, since that’s the threshold that triggers reassessment
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u/moridin13 Sep 01 '26
THAT is the real issue.
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u/BlazinAzn38 Sep 02 '26
All of Prop 13 is total BS. It’s just created a class of landed gentry in the state who are wholly subsidized by any poor sap that wasn’t lucky enough to have been an adult 30 years ago
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u/senorfroggyhat Sep 02 '26
Prop 13 passed 48 years ago! As much as I’d love to believe it was all Boomers who passed it, the oldest would have been 32 in 1978 and the youngest not even of voting age (Gen Jones would have been teens). I’m sure plenty of Silent Gen’s also voted for it but for sure the Boomers have kept it alive.
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u/babbleon5 Sep 02 '26
seniors were getting taxed out of their homes because of the explosive growth in property value. additionally, cities and counties were growing their bureaucracy aligned with the growth in property tax, rather than along requirements.
Prop 13 isn't great, but it was put together for solid reasons. It needs to be reformed to better address modern challenges and realities.
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u/APrioriGoof Sep 02 '26
“Taxed out of their homes” is a very bad way to describe “have a massive windfall asset they could sell and move to nicer homes outside of the area where workers with families need to live”.
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u/say592 Sep 02 '26
People forget that most taxes are designed to influence behaviors, and even when they aren't intentionally designed that way, they still have that effect. Someone being "priced out" is a feature, not a bug.
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u/terrible-law-69 Sep 02 '26
Yep, it allows more productive owners to scoop them up and do better things with the land.
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u/babbleon5 Sep 02 '26
this isn't a realistic view of how people live, they generally like where they are, their children (and grandchildren) are probably nearby, their friends of 30 years are up and down the street. economics are a single strand in an array forming human behavior.
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u/APrioriGoof Sep 02 '26
Sure. But, like, the massive windfall from selling their property that is now so valuable they cannot pay the appropriate taxes on it should easily rent them a place more appropriately sized for retirees nearby. I’m not sure why they should get a free pass when working people with families struggle to purchase homes, and if they do they have to bear essentially the entire tax burden.
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u/banshithread Sep 02 '26
>build a house on land i bought 50 years ago
>grow up with the community, contributing to the community, aging with the community
>being forced to move out because taxes
some redditor: you're old and should go live in a retirement home, who cares if you built your dream home to live near your family, fuck you
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u/Ok-Effective-2202 Sep 02 '26
Why would someone living in SF or LA, and lived there their whole life, want to sell their house? Where are they gonna go Modesto? Merced? Why would they leave somewhere that they love and are part of the community?
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u/gargeug Sep 02 '26
You have no concept of community or attachment do you? Its just all about money and moving houses every year to where the market says they should live. Which all senior citizens have such an easy time at doing.
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u/babbleon5 Sep 03 '26
they've been paying taxes in that neighborhood for 30 or 40 years. They're the ones that built the schools and streets and fire stations. They've paid their share.
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u/daYnyXX Sep 03 '26
I love when people describe it as a bad thing. "Oh no, my house is worth millions and I can no longer afford the taxes on it" is a fantastic problem to have.
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u/desertdilbert Sep 02 '26
I'll be sure to tell Widow Jones that having to sell her home and move out of the area she has lived for over 30 years, while moving into a home 100 miles away from her family, that she should be grateful for her "windfall".
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u/say592 Sep 02 '26
Yeah! The school teacher teaching at three school down the street from her should be the one who lives in a home 100 miles away!
If Widow Jones has this massively appreciated asset that she wants to maintain, maybe she (or her family) should find a way to sustain it. Perhaps she could rent a room to the school teacher, or she could build an ADU and rent it out. Or she could borrow against the equity in her massively appreciated home and cover the property taxes that way.
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u/APrioriGoof Sep 02 '26
Widow Jones can take her massive home windfall and rent and pay the owners actual real property taxes like everyone else has to! Widow Jones could rent a pretty nice place close to her family for the rest of her life if she chose to realize her property value.
Instead, in the real world, what Widow Jones does is hold onto a house that is way too big for one person while contributing virtually nothing to her local government, all while fighting against any new housing development so the rent goes up for everyone because it’s impossible to build.
Your widow is a villain.
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u/TinFoiledHat Sep 02 '26
Funny that it’s now enabled even more explosive growth of property value, and made the barrier to entry for first time buyers approach infinity. While also breaking the public education system, so the rich get richer-er and the poor get poorer-er.
Needs to be abolished. Not reformed.
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u/Gingevere OC: 1 Sep 02 '26
seniors were getting taxed out of their homes because of the explosive growth in property value.
That's a feature, not a bug.
Seniors shouldn't be clogging up large houses on large plots with 3 empty unused bedrooms in the middle of the city. They should be selling, getting a fat payday, and moving out to retire elsewhere.
That land needs to be freed up for productive use. Either housing for people that are actually working in the area or bought be developers who will turn the lot from a home for 2 into homes for 20.
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u/babbleon5 Sep 02 '26
1) Generally, no large lots in CA cities. But, almost all single family instead of multi-family, although zoning laws have created flexibility for multi-family dwellings.
2) Seniors have the right to live wherever they are earned and purchased, just like all of us. Who are you to tell them to move? Change the picture and say, "we shouldn't have those crazy young tatted kids living around us."
3) Changes in residential building codes are essential to modernizing suburbs to support modern populations. But, that doesn't include kicking out seniors who just want to enjoy their final years in something comfortable and familiar.Property rights are an essential component to living in the US, good, bad or indifferent. The idea of moving seniors off their property so it can "be freed up for productive use." sounds like a dictatorial manifesto.
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u/Gingevere OC: 1 Sep 02 '26
Where did you get this bizarre concept of property rights that extends all the way to "the public must subsidize assets I have purchased but cannot afford."?
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u/Abcdefgdude Sep 02 '26
Your second point is silly because yes, people say that all the time and it's completely legalized. Southern California has some of the largest exclusive 55+ communities in the country, only rivaled by Florida. Areas without deed restrictions still end up with 0 young people because of insanely high home prices that are only affordable if you moved in 30 years ago.
Seniors want it both ways. If they don't want to pay the taxes on their inflated property they shouldn't be allowed to sell it for the inflated value. Bending over to subsidize the richest members of the community is just stupid
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u/lislejoyeuse OC: 1 Sep 02 '26
agreed. times are changing, no one is immune from that. everyone should be allowed to live an exist and have access to healthcare and food and water. not everyone needs to be guaranteed to maintain their standard of living without adjustments in income.
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u/jelloshooter848 Sep 02 '26
Ya, if people were getting priced out:
Boo-hoo, renters get priced out all the time, except they don’t have the option to cash out the millions of dollars of equity that priced them out.
If we really wanted to protect vulnerable people like old widows on a fixed income we could have just addressed that directly by creating programs to defer taxes until they died and they would get paid by the estate or something. Or they could have just waved taxes in specific cases. Either option would be way better than prop 13.
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u/Jah_Man_Mulcahey Sep 02 '26
Prop 13 SHOULD have been for owner occupied residential properties only. No income producing residential or commercial properties included.
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u/CMidnight Sep 03 '26
Honestly, fuck seniors. Let them eat cat food in the street. What they have done to the environment, the country and the economy is fundamentally unforgivable.
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u/qwerty_ca Sep 02 '26
seniors were getting taxed out of their homes
That's the whole fucking point. Seniors are sitting on homes in extremely valuable areas like the San Francisco Bay Area where a tech worker occupying that home will be able to produce far more GDP and tax revenue if only they were actually buy the house. The seniors should be selling that house and moving to a shitass state like Florida where there's nothing else going on economically and property prices are cheap.
Instead, seniors voted to limit their own taxes, forcing tech workers to bid ever higher for the same limited housing stock and thus indirectly forcing the non-tech workers completely out of the area since they can't compete.
As a result, you now have the economically useless senior population being subsidized by the high taxes paid by newer tech arrivals and everyone else having to leave entirely.
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u/gscjj Sep 02 '26
What’s happened in the last 48 years? The average age of California Congress is probably in the mid 50s, the large majority were probably kids or not alive when it passed.
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u/kayakhomeless Sep 02 '26
The wild thing is there was a SCOTUS Case years later that established that it’s unconstitutional for a state to treat people differently based on how long they’d lived in that state, but I guess property taxes don’t count
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u/PDXDeck26 Sep 02 '26
there's no residency component to Prop 13 tax limits, meaning you could be an out-of-state resident and own CA property and still get the benefit, so this case means nothing for Prop 13.
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u/a_moron_in_a_hurry Sep 02 '26
Prop 13 applies to the property, not based on where the owner lives. Someone could own California property while anywhere else and the same Prop 13 assessment rules would still apply.
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u/AssimilateThis_ Sep 02 '26
It also just causes a terrible mispricing of real estate in general, it creates an incentive to never leave that house unless you are sure you never want to come back to something similar in that area. Basically no one puts their house on the market unless they intend on leaving CA for good or are upgrading to the next larger house.
Normally it makes a lot of sense for retirees to dump the full size SFH. But in CA you could end up downsizing and actually paying more property tax because of the new assessment.
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u/post_button_account Sep 02 '26
It particularly favors the rich who dont have to get a mortgage - they never sell/buy the house, instead they just sell/buy the holding llc. As a result the property taxes never reset even if there is a new owner.
Only average Joe who needs a mortgage and hence must buy in his own name suffers.
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u/Kahzgul Sep 02 '26
That loophole needs closing.
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u/moosher Sep 02 '26
Is this true? Quick search says it’s not true
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u/nyxo1 Sep 02 '26
It's not true. I have no idea what they're talking about. California law requires that property tax be reassessed due to any "Change in Control" of a properties ownership. It doesn't matter if it's owned by an individual or corporation or LLC
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u/Gingevere OC: 1 Sep 02 '26
The Los Angeles Country Club is still paying taxes based on the value it was established at in 1897. 129 years ago. No person alive is that old.
So obviously corporate ownership actually does circumvent the property's tax assessed value resetting. The corporation can change hands but so long as the property stays in that corporation, there's no reset.
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u/Vishnej Sep 02 '26
There has been no change in control.
The property at 1533 Mayfield Drive is still owned wholly by the corporation entitled "1533 Mayfield Drive LLC". Only the shareholders of the corporation have changed.
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u/jedberg Sep 02 '26
It only triggers if at least 50+% of the owners change within a certain time frame (I think a year?). So you put the LLC in the names of the parents and kids. One parent dies, that's only 33% if they have one kid. Two kids and it's only 25%.
My friend is a tax and estate attorney in California. They buy all their houses with an LLC. Then take out a mortgage in the LLCs name.
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u/Fidodo Sep 02 '26
Yes, but it would be incredibly hard to repeal it for residential. I think things that could be accomplished are repealing or for commercial and capping residential to one per person and giving tax breaks to renters. Repealing it entirely and replacing it with something equitable is a non starter.
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u/letsburn00 Sep 02 '26
I once saw a video made by the most entitled people ever..They were trying to do a prop where if you had inherited a prop 13 house, you also never had to pay property taxes.
The entire claim of prop 13 was so retirees and older people wouldn't be forced to move when their houses gained value. These people just wanted their tax break extended indefinitely.
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Sep 01 '26
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u/Vishnej Sep 02 '26 edited Sep 02 '26
Rent control is pretty similar.
Capitalism regularly redistributes money upwards by its most basic mechanics of operation. Seek redistribution from the people with lots of money, towards the people with less money, and you can find a stable system.
What rent control and prop 13 are intended to do, is transfer money from residents who bought recently, to residents who bought a long time ago. This is not the goal we should be seeking. In actual practice they also pursue this goal imperfectly, and it has side effects like LLC loopholes, slumlords, and deterrence of redevelopment.
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u/thewhizzle Sep 02 '26
Now you're going to trigger people.
They are both price controls that favor people who've lived there longer, while pushing the burden onto newer entrants into the market.
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u/Vishnej Sep 02 '26
They try to. Even as I disagree with that goal, I point out that they don't do it without some unrelated negative side effects.
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u/therealhlmencken Sep 02 '26
Both are an issue. You shouldn’t be taxed out of your primary home but it being due upon sale or transfer makes sense
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u/wadamday Sep 02 '26
No. Why should I have to pay higher property taxes than my boomer neighbor simply because I ALSO have to fork over half of my take home to pay for a much higher mortgage? And I got lucky and purchased in 2020. It'd be unattainable for me to get on the property ladder if I tried to start now.
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u/ham_plane Sep 02 '26
Because the people voted for it!
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u/alexja21 Sep 02 '26
More specifically, because Boomers vote in way higher numbers than younger people.
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u/Kahzgul Sep 02 '26
And young people often cite the system favoring boomers as a reason why they don’t vote. If they would just vote, the system would very quickly favor them.
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u/4leafplover Sep 02 '26
Should be repealed for non residential at the very minimum.
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u/Leon_Thomas Sep 02 '26
Both parts equally ridiculous. The non-residential assessment ceiling definitely feels more unfair, but the ceiling on residential property is a much greater cause of CA's housing crisis and is enormously inequitable. It's a regressive wealth tax that takes from the less wealthy to subsidize the wealthy.
If your property tax suddenly increases, it means your wealth also dramatically increased. There is a legitimate conversation about liquidity, and governments can and should implement programs to allow those without the ability to pay to delay or pay a small fraction of taxes, paid with interest by the eventual sale of the house. But every aspect of Prop 13 is terrible policy.
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u/stewmander Sep 02 '26
Isn't that basically how prop 13 works though?
You pay a small fraction of the property taxes, as assessed value only goes up 2% annually.
Then when you sell, you pay capital gains tax on the sale and the new owners are assessed at the sale value.
Of course there are ways to avoid this with inheritance...
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u/kentrak Sep 02 '26
I can see reasons you'd want to incentivize cheap commercial space (so you get local neighborhood shops and some small business space close to housing), but that's just it, you'd want it to be fairly targeted at neighborhood commercial space (C-1) and general commercial (C-2), and for any sort of country club (unless in name only and it's actually a public area), that definitely shouldn't qualify.
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u/spaceman_spiffy Sep 02 '26
Yeah my neighbors are about the same age as me and were able to buy their home during the housing crisis. I've only just recently been able to buy the house next to them after recovering from that crisis for 4X as much money. And now I get the reward of having to pay 4X as much tax. It's like getting screwed 3X in a row because I was more poor earlier.
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u/IBGred Sep 02 '26
I'm paying almost 8X a neighbor's landlord who rents out an almost identical old house that was passed down. I have no problem with them inheriting the place (which I think was before prop 19). But it really bugs me that new owners effectively subsidize the taxes of people that purchased homes before them.
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u/Threxx Sep 01 '26
I can imagine this law was made with good intentions though, so people don’t get forced to move out of their house because of skyrocketing property values in their area. But definitely falls under the category of creating some undesirable unintended consequences..
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u/speaking_moose Sep 02 '26
It was, but it ended up with people not moving to downsize after the kids had grown because their costs would have jumped dramatically. That puts pressure on availability and housing costs.
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u/aWobblyFriend Sep 02 '26
it was not made with good intentions, and the fact that people still think it was is the most successful lie that the howard jarvis tax association has ever told. california already had mechanisms to prevent old people who couldnt afford property taxes from getting forced out of their homes. prop 13 was just a handout to wealthy homeowners and businesses who wanted to "stick it" to the government, and it has been deleterious for the actually poor people in the state (renters and central valley residents) who got shafted either by rising rents or declining tax revenues. Empirically, the policy did exactly as it was intended to do: shift money away from the poor and the renters, and towards the wealthy homeowners of the state.
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u/ziltiod94 Sep 02 '26
Basically excacerating the problem which it sought to alleviate.
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u/mudamuda333 Sep 02 '26
How does it tho? The problem it sought to alleviate was people being priced out of homes they already owned. The unintended effect is an expensive market for new buyers and renters. The original owners only win.
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u/domthemom_2 Sep 02 '26
They don't win when they can't move out.
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u/mudamuda333 Sep 02 '26
They do win if they choose to leave because the value of the house is much higher than when they bought. Buying a house for $100k and selling for $2M is a win to me.
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u/theboyqueen Sep 02 '26
I would love to see any evidence it has accomplished this goal. Every other state is the control group for this experiment, and I doubt California has done any better than any other state in allowing people to stay in their homes.
In fact I bet it has done the opposite, by raising the cost of housing overall. It is also a reason income tax in California is so high. Even the most progressive income tax is more regressive than property tax.
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u/_zoso_ Sep 02 '26
Eh, it was more about a general anti tax campaign which was gaining steam in the late 70s. Another huge problem with prop 13 is it caps property tax at around 1% and forbids any new property taxes.
California has pretty low property tax as a result, but it also means the state has to turn to sales tax and other revenue sources which are deeply unpopular and sometimes unfair.
The result is in the wealthiest state in the wealthiest country in the history of the world, public schools resort to charity drives every semester to stock their classrooms with supplies. It’s fucking infuriating.
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u/monkeywaffles Sep 02 '26
sales tax is also pretty regressive, and im guessing a lot of those other revenue sources are largely regressive.
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u/MyDisneyExperience Sep 02 '26
Absolutely massive impact fees on new housing, which also makes housing more expensive because incremental projects don’t pencil
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u/Electrifying2017 Sep 02 '26
And idiots don’t get it. Some Boomer POS was complaining on Nextdoor about receiving a flyer requesting donations for basic supplies from her grandchildren’s school. She stated that teachers should be using their assigned budget to pay for supplies. She was appropriately lit up 🔥
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u/TravisKOP Sep 02 '26
Only makes sense for residential properties the fact that extends to commercial is insane
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u/hibikir_40k Sep 02 '26
It also doesn't make sense for residential properties, and it's part of why they are so expensive!
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u/DJinKC Sep 02 '26
The golf course is "member owned," so even though the membership has turned over 100% they still get the old tax amount.
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u/livefreeordont OC: 2 Sep 02 '26
Theseus property tax loophole
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u/Zigxy Sep 02 '26
Its basically the same rules for inheriting a home.
If your child inherits your home, then they get to keep the ultra-low property tax rate.
However, just a few years ago, Prop 19 added some new restrictions, such as requiring the heir to actually live at that property to get the benefit.
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u/thri54 Sep 02 '26
What happens if you deed it to a trust or your kid? Do they reassess it at fair market value?
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u/HighTechnique Sep 02 '26
This only changed recently where the trust loophole was closed. But up until the last few years, this is how homes were passed down from parents without resetting the cost basis.
A much needed change.
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u/jbonejimmers Sep 02 '26
This is a pretty interesting contrast to how it works in my state (Massachusetts). Here, basically towns are limited to collecting 2.5% more in property tax across the entire city each year, unless residents vote and pass an override to collect more (the amount is whatever designated in the vote).
This means the tax bill rises steadily for everyone. The downside though is that when healthcare costs are rising like 10% year over year + inflation + pensions spiking + state funding not keeping up.., the city budgets are in a chokehold. Lots of arguments happening from town to town about passing overrides, which, as you can imagine, are contentious AF.
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u/polytique Sep 02 '26
That’s the same in California. There is an adjustment of up to 2% every year.
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u/billythygoat Sep 02 '26
Tbh, kind of fucked up, kind of not.
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u/Tucancancan Sep 02 '26
Yeah, where I live the city can re-asses your property value every few years and tax you at the new rate. Good for having functional city services, insanely shitty when property values went up and retirees on fixed income getting fucked by the new rates
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u/SmokeDetectorJoe Sep 01 '26
This is ridiculous, but it's also a little misleading to call a 33,652 square foot 11-bed 27-bath estate on an acre of land in the middle of west LA (appealingly situated next to a fancy country club) a "single family home", which makes it sound like any old picket fence cookie cutter from the 60s.
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u/pcurve Sep 02 '26
Didn't know that house had an interesting history...
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u/bg-j38 Sep 02 '26
Demolished another building built in 1927 to build that monstrosity. But clearly a 6400 sq ft. six bed, five bath Mediterranean revival house wasn't nearly opulent enough.
https://www.occrp.org/assets/images/stories/CCWatch/investigations/offer-mapleton-back4.jpg
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u/JConRed Sep 02 '26
Yeah indeed. The pool in the back yard is longer than the house I grew up in... and the pool doesn't even look big beside the house.
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u/Frumbleabumb Sep 02 '26
I mean. If a single family lives there... It'd a single family home. But your point is valid
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u/DizzyFrogHS Sep 01 '26
This is a famous case. Property taxes are set at the time of sale. The country club is owned by members. Lots of new members buy in and sell every year. However, under local rules, these don’t count as “sales” to trigger reassessment. So the property taxes for one of the most valuable pieces of property in the world, have been fixed for decades, and there is no current path to reassessment. This is costing the city tens of millions of dollars in taxes every year.
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u/edweirdmuybridge Sep 02 '26
Someone clever likened this tax/ownership paradox to the Ship of Theseus.
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u/Zigxy Sep 02 '26
Some clarification:
People who inherit homes (and move into them) will still keep their parents' low tax rate. So its not a magical corporation-specific benefit. Lots of people in California are inheriting their parents' homes and are paying much less than their neighbors.
Property tax does go up a little bit (2% per year). Most years, 2% is less than inflation/market gains, but just wanted to clarify.
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u/Tiek00n OC: 1 Sep 02 '26
Some clarification:
People who inherit homes (and move into them as their primary residence within 1 year will keep some or all, situation-depending their parents' low tax rate.
Examples:
- Parents' property is tax-valued at $400k when the transfer happens. The market value is $1.3M at the time. Because the market value is less than (tax value + $1M = $1.4M), the $400k tax value is kept after the transfer.
- Parents' property is tax-valued at $400k when the transfer happens. The market value is $1.75M at the time. Because the market value is more than (tax value + $1M = $1.4M), the tax basis increases. The increase amount is $1.75M - $1.4M = $350k, so the new tax value is $750k.
- Parents had the property for a super long time (maybe grandparents), and is tax-valued at $200k with a market value of $4M. The new tax value increase is $4M - ($200k + $1M) = $2.8M, bringing the new tax value up to $3M.
This new/updated law went into effect on 2/16/2021, so any transfers before that date didn't have this $1M value-exclusion threshold apply.
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u/aburrido Sep 02 '26
I hate prop 13 as a whole but this aspect of it, drives me crazy. It’s such bullshit.
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u/Eomb Sep 02 '26
How does it work? So they don't actually own the golf properties when they buy them?
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u/Right_Lengthiness266 Sep 02 '26
The country club owns the golf course.
The country club is owned by its members, but no individual member has greater than 50% ownership.
Transfers of ownerships takes from old members to new members do not trigger reassessment of the property taxes, because nobody gains/losses a 50% controlling interest in the organization that owns the property.
Because of California's backwards ass property tax system, unless a property is sold, the tax assessment can't go up by more than 2% per year, so in real dollars the property taxes have gone down over the past 50 or so years since the passage of prop 13.
Which means that everyone else in LA ends up basically subsidizing the property taxes of a country club with quarter million dollar initiation fees.
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u/Tall-Log-1955 Sep 01 '26
Prop 13 is cancer and we should repeal it
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u/karma_the_sequel Sep 01 '26
Prop 13 should never have been permitted to apply to commercial real estate.
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Sep 02 '26
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u/qxrt Sep 02 '26
Should be noted that rent control is the functional equivalent for renters that Prop 13 is for homeowners, so it doesn't make sense to decry one and turn a blind eye to the other.
Rent control is one area where politicians completely ignore the expert consensus of economists (that rent control ultimately makes housing less affordable for everyone) and enact rent control as a populist policy.
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u/babybunny1234 Sep 02 '26
Rent control is often a response to policies like prop 13 (it was in San Francisco)
Lots and lots of subsidies for the rich and property owners.
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u/CivicDutyCalls Sep 02 '26 edited Sep 02 '26
Prop 13 applies to everyone whereas rent control is functionally for low income people. If prop 13 applied only to individuals who own property below a certain income level or who are fixed income (social security), then I might agree with you.
Edit: im not saying rent control is a good policy either. Im just saying that it at least has a smaller proportion of wealthy people that qualify for it. You have to be poor to get on rent control whereas you dont for prop 13.
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u/Alagore Sep 02 '26
Rent control is for people who already have a lease and who aren't looking for a new place to live. It is not directed at people with low income, and given the demographics it favors, it benefits wealthier people more frequently.
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u/MrsMiterSaw Sep 02 '26 edited Sep 02 '26
Prop 13 applies to everyone whereas rent control is functionally for low income people.
This is completely false.
You have to be poor to get on rent control whereas you dont for prop 13.
This is 100% wrong. For example, in San Francisco, RC is applicable to any building with 2 or more units built before about 1980.
Income has nothing to do with it. Nothing.
Laws are similar for all the other cities with rent control. Look it up.
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u/angry-mustache Sep 02 '26
rent control is functionally for low income people
Plenty of affluent people live in Rent controlled housing. They get a rent controlled apartment when they are poor and at the start of their careers and after career advancement and money they keep that rent controlled apartment.
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u/thewhizzle Sep 02 '26
Prop 13 applies to homeowners specifically, but advantages home owners who've owned their home for longer over any specific economic need. The same is true for rent control except obviously for renters.
I know plenty of well paid SF tech workers who bought homes in the suburbs but keep their SF apartments for when they want to visit on the weekends because the rent is so damn low.
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u/Equivalent-Process17 Sep 02 '26
Of course it is, that's why the other guy said only commercial lol. He knows that, people only want others to pay their fair share
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u/earthhominid Sep 02 '26
It plays a protective role in places where property values are prone to rapid increases.
It was, evidently, poorly thought through. And it definitely got some predatory provisos added to it.
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u/RadiantPumpkin Sep 02 '26
Those are the exact conditions where rising property taxes can be a benefit to encourage densification in highly desirable areas
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u/earthhominid Sep 02 '26
I think that California's strong environmental review laws and the way theyve been leveraged to stifle dense development in evidently highly desired areas has done a lot more harm to the housing in the state than the low property tax rate
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u/TripleSecretSquirrel Sep 02 '26
It shouldn't apply to residential either. It disincentivizes transactions, it gives a huge advantage to every incumbent property owner, and beyond just keeping taxes very cheap for longtime homeowners, it shifts the overwhelming majority of the property tax burden to younger/newer buyers.
Pardon me if I don't cry for people who own property that has multiplied in value many times over. If the tax bill gets too high, they can sell the property and net more money that I make in five years of working and go live somewhere else. Just because they happened to buy a home in California at some point in the distant past doesn't give them the perpetual, economically-protected, right to continue to live in the same place.
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u/CrayZ_Squirrel Sep 02 '26
The idea is not to kick your 80 year old grandmother out of her home for the last 40 years because property values exploded around her.
Good in theory, but the implementation is a mess.
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u/Tall-Log-1955 Sep 02 '26
Lots of ways to help little old ladies that don’t completely fuck over the primary form of taxation in the state. Prop 13 is the worst
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u/Leon_Thomas Sep 02 '26
There are plenty of states that allow you to defer property taxes, paid for with interest by the eventual sale of the home upon sale, transfer, or death.
Oregon allows it for Seniors making less than 70k per year; Illinois allows seniors to defer up to $5k in taxes per year; Minnesota allows seniors to defer any taxes above 3% of household income; Colorado allows full deferral, and there are plenty more.
These are all much better policies that allow grandma to keep her lifelong home if she wants without a regressive tax that makes the poorer neighbor pay more between two neighbors in identical houses.
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u/CMWalsh88 Sep 02 '26
Prop 13 should never have been permitted to apply to any real estate. Over time it just shifts the tax burden on young people right in the middle of them trying to have family’s and paying for daycare.
Utah has a good idea that I would take further. Just have a primary residence exemption.
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Sep 02 '26
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u/post_button_account Sep 02 '26
And there are more owners than renters. And owners vote more reliably since renters often are not even registered where they rent.
Dont think it can be repealed.
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u/Smelly_God Sep 02 '26
Even when we tried to partially roll it back with Prop 15, which would've targeted commercial and industrial properties, we still failed. Lot of dumb voters unfortunately.
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u/maringue Sep 01 '26
Property tax structures are horrific in this country. There's so many examples of perverse incentives.
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u/cicglass Sep 01 '26
Is that a billion dollar home?
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u/upvoter222 Sep 02 '26
The "single family home" is a mansion on a few doors down from the famous Playboy Mansion. It has 11 bedrooms, 27 bathrooms, an 8 car garage, a movie theater, spa, and staff quarters, among many other features.
Westfield Century City is a mall.
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u/Mojeaux18 Sep 03 '26
This is prop 13 shenanigans.
It passed in 1978 after California’s market-value property-tax system and high local rates made tax bills volatile enough that homeowners feared being taxed out of their homes. The fix capped the base rate at 1% and generally limited assessed-value growth to 2% per year until a sale or major construction triggers reassessment.
The catch: it covered commercial and industrial property too. So a country club or corporate parcel held for decades can be taxed on an assessment far below its current value, while a recently sold house pays near-current-market taxes.
Not an argument for Georgism. It is what happens when a justified revolt against bad tax policy hardens into a new, permanent distortion.
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u/Infamous_Echo_5683 OC: 3 Sep 01 '26
Source: Los Angeles County Assessor, current roll (parcel records via the assessor's public portal). Boundaries from OpenStreetMap.
Tools: Python for the parcel pull and geometry, SVG for the render.
The gap comes from two things:
Proposition 13 (1978) freezes assessed value at its 1975 base and caps growth at 2%/yr until a property changes hands, the club hasn't sold, so its land is still carried on a 1975 base year.
Then Article XIII §10 of the California Constitution (passed 1960) requires that a nonprofit golf course of 10+ acres be assessed on its use as a golf course rather than on what the land is actually worth.
The country club allegedly charges an est. $250k initiation fee to join.
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u/PreyInstinct Sep 01 '26
Does the la assessor portal have an API? Can you do this for the whole county to make a map of freeloaders?
Prop 13 and golf course exceptions are garbage, but so is assessing structures for taxes. Street level parking and vacant lots get taxed below their appreciation while apartments, shops, offices, and other nice things get taxed way more. Land value tax is way more fair.
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u/CharlieDelta- Sep 02 '26
I think Malcom Gladwell did an episode on this for his Revisionist History podcast. I don’t like Gladwell very much but it was a good listen.
It’s call A Good Walk Spoiled
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u/OmfgHaxx Sep 01 '26
Prop 13 is so garbage. It also makes it so people keep property they don't even need anymore and keeps home supply artificially low.
Why would a retired couple downsize the home they don't need anymore if their property taxes would go way up by downsizing?
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u/Otto_the_Autopilot Sep 01 '26
A retired couple can transfer their exemption to a new property.
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u/scraejtp Sep 01 '26
How is that supposed to work? If their current house is under taxed by $1M, they can buy a $1M property and then pay no property tax?
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u/Otto_the_Autopilot Sep 02 '26
If you sell a $1M house with an annual $8000 property tax bill and you new house is $1M or less then you keep the $8000 tax liability instead of ~$12000 ($1M * 1.2%). Anything over 1M gets the full tax rate on the value over $1M.
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Sep 01 '26
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u/GoblinRightsNow Sep 02 '26
There are lots of ways to control tax bill growth for someone's actual primary residence without freezing tax rates for commercial and investment properties. Any reasonable repeal of Prop 13 would involve creating bigger exemptions for actual homeowners.
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u/bkpilot Sep 02 '26
FWIW the “it’ll be an exodus” justification rarely comes true. I’ve been in NYC long enough to be immune to it. There’s always an exodus related to tax hikes that is foreseen but never arrives. Typically you see rotation, which is healthy, not abandoned properties.
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Sep 02 '26
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u/effyochicken Sep 02 '26
The impact has been this:
An entire generation of homeowners in LA county couldn’t afford to buy their own home today if they had to so they never move.
An entire younger generation of prospective homeowners can’t afford to move out of their parents house and buy their own home because they’re all tied up with the generation before.
No new single family homes can be built because all the land is already being used in LA County.
Condos and townhomes are being built but only luxury ones that cost $700k+ anyways.
So the whole region is basically locked up. Can’t fix any of the housing problems without hurting one or more groups.
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u/1tWasA11aDr3am Sep 02 '26
Revisionist history has a great episode on the LA country club’s tax status https://www.pushkin.fm/podcasts/revisionist-history/a-good-walk-spoiled
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Sep 02 '26
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u/pdxarchitect Sep 02 '26
It is a University with extensive grounds, including an impressive arboretum. The odd thing, is that they supply most of the services that their taxes would go toward. Public Safety, Road Maintenance, Utilities, etc., are all provided by Stanford, and not the local cities and state.
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u/Diarrhea_Sandwich Sep 02 '26
The club raises the value of the SF homes and the city wins that way.
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u/gm92845 Sep 02 '26
This is why people want to amend prop 13 to exclude commercial real estate and allow them to be taxed at the rate of inflation. But of course it would never fly because corporations spend millions into fighting any proposed measure to fix this funding gap.
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u/harsh2193 Sep 02 '26
For reference, the estimated initiation fee to join this invite only country club starts around $250,000, but some estimates go up to $500,000. Annual dues are estimated between $15,000 and $30,000.
They absolutely can afford paying their fair share.
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u/kayakhomeless Sep 01 '26
Land Value Tax would solve this
Or just literally any sensible property tax reform
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u/seanmdevine Sep 02 '26
There’s a good prop 13 revisionist history episode from July called “A good walk spoiled”. It’s gross how little LA country clubs pay in property taxes.
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u/Schmeckitup Sep 02 '26
There was also a specific law fought for by Bob Hope (prop 6 in 1960) which protected country clubs from higher taxes. Malcom Gladwell talks about it in a Revisionis History episode called “A good walk spoiled”. It keeps country club taxes at rates even lower than prop 13. The ownership of the club by its members never changes (even though they die out or leave) so the tax barely goes up. Yet another protectionist policy for the upper class.
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u/Any-Platypus-3570 Sep 02 '26
Not only is Prop 13 keeping taxes on golf low, but California has a special law just for golf courses that assesses the golf course as if that land was unusable for any other purpose. Golf is BY FAR the most subsidized sport in Los Angeles. And with many of its players being the most wealthy of the city, that's super fucked up.
source: lobbyist for golf courses in California
California is practically unique in going to such great lengths to insulate its parkland golf courses from commercial repurposing. It is joined by roughly half of the nation’s states in exempting the game from onerous property taxation. And it exempts greens fees, membership dues, range balls, and cart rentals from all forms of taxation.
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u/ReaganRebellion Sep 02 '26
How much sales tax does that house collect and send to the city, county, and state?
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u/workinkills Sep 02 '26
36million dollar single family home… those poor, poor bastards
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u/KiloAlphaJulietIndia Sep 02 '26
Golf clubs in LA have a century old loophole by calling themselves nonprofit, with memberships.
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u/datlankydude Sep 02 '26
Not really beautifully displayed data, it's three parcel maps and three numbers. But yes, it's interesting. Prop 13 blows.
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u/smoothnuggz Sep 02 '26
Holy smokes, should also be noted that 530 S Mapleton is an absolutely massive mansion in an elite neighborhood, adjacent to an extremely nice country club
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u/bofhjake Sep 02 '26
LACC is a non profit, that is why it's taxed so little.
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u/yowen2000 Sep 03 '26
Why should a country club, not open to the public, enjoy this status? That's wild.
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u/gggplaya Sep 04 '26
How is that country club worth less?? I'm sure it has expensive buildings on the property. My guess is whenever the tax assessment comes around, some members are part of whatever council does the tax assessment and lowers it.
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u/Beautiful_Finger4566 Sep 02 '26
Prop 13 is the same economic concept as rent control
both of them need to be repealed in every city
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u/EmRatio Sep 02 '26
While I agree, its political kryptonite, and it will never pass. Try telling homeowners they can't have their homes anymore because taxes. It definitely won't pass in our state Legislature because of the supermajority lock in Prop 13. There is also no way an initiative ballot would pass since homeowners are effectively being asked to vote themselves out of their own homes.
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u/night-shark Sep 02 '26
Setting aside commercial property taxes, which totally shouldn't be eligible for Prop 13... Lots of people here are legitimately and rightly angry about California property tax rules and housing affordability.
But the "I don't care what happens to old people who bought their house 40 years ago" is grossly and completely devoid of empathy and pits the middle class against itself, rather than focusing the attention on the real cause of the problem. It's like some of you revel in the idea of being cruel to these folks, just because they are "boomers".
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u/Smelly_God Sep 02 '26
You're introducing a statement nobody is saying "I don't care what happens to old people who bought their house 40 years ago" to argue against.
Wanting people to pay property taxes according to the value of the property doesn't mean people are saying whatever tf you're putting in their mouths.
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u/BrandenburgForevor Sep 03 '26
Its not that I dont care what happens to them, it's that property taxes are in part there to push people out so someone else can use it more effectively.
The whole idea that old people should get reduced property taxes is stupid af when they use more of the things they fund (other than schools) more than anyone.
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u/cavedave OC: 115 Sep 03 '26
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