Here in this San Francisco Bay area - Contra Costa County to be exact - if you are over 55 and thinking of moving this year, you need to know about Proposition 60. Typically when a person buys a home, the property taxes are reassessed based upon that new purchase price. It sure discourages some people from making that move if you've been in your home a long time. Just think.... You bought your home for $53,000 in the 1970's and your property taxes are just $1,200! Your home now will yield you over $650,000. Here comes 2005 and you're ready to retire to golf course living and you find the home of your dreams for $550,000. You can essentially buy that new home outright. No mortgage, no payment... ahhhh, what a life.. BUT WAIT... taxes... you now might expect to pay over 6 times your current tax amount! $6000 or more per year on taxes based on that purchase price! Proposition 60 allows you (within certain guidelines) the ability to transfer that original $1,200 tax to your new house. How cool is that? Buy your dream home, no mortgage, $1200 a year taxes and now your only care in the world is your golf score. Well so what are the parameters?
- You must stay in Contra Costa County**
- You must purchase or construct a home worth the same or less than the original property (sometimes hard to do in our area to be sure).
- The original property must be sold for consideration (i.e. no giving it or transferring to family members), must be an "arms-length" transaction.
- Just one person on title (husband or wife) needs be over 55.
- Depending on timing you may be able to buy a house for 10% more . Read this clause very careful to avoid a big problem.
**A related proposition (90) allows you to move outside of Contra Costa County. Not many counties participate in this - only Alameda, Los Angeles, Orange, Santa Clara, San Diego, San Mateo, Ventura. Definitely some promising destinations within those counties, but some of the local popular retiree places are noticeably not included i.e. Placer County (Lincoln), El Dorado County (Serrano) - bummer. But Somerset in Brentwood, Rossmoor in Walnut Creek are winners!
