So, how does it work? Well, when you buy a property in California, you'll pay a base tax rate of 1% of the property's value, plus any additional local taxes and voter-approved taxes. And let me tell you, those local taxes can really add up – we're talking hundreds, if not thousands, of dollars per year.
But wait, there's more! California also has a Proposition 13, which limits the growth of property taxes to 2% per year. That sounds like a great deal, right? Well, it is, until you realize that it only applies to primary residences, not investment properties. So, if you're a savvy investor looking to buy up some California real estate, be prepared to pay a pretty penny in property taxes.
And if you thought that was all, think again! California also has a state tax on property transfers, which can range from 0.55% to 1.25% of the property's value. That's right, folks, when you buy or sell a property in California, you'll be paying a double whammy of taxes – ouch!
Californians Could Expand Property Tax Breaks Under Proposition 5
