Rental accommodation once retired

All the different ways of solving the shelter problem. To be static or mobile? Roots, legs, or wheels?
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Sclass
Posts: 2787
Joined: Tue Jul 10, 2012 5:15 pm
Location: Orange County, CA

Re: Rental accommodation once retired

Post by Sclass »

Salathor wrote:
Fri Mar 15, 2019 10:38 am
Urgh, no kidding. I've been enjoying CA's prop 13 prop tax rules for the last few years, but there's now some talk amongst CA's left about revising the rule. I suspect that, for politics' sake, the revision would impact commercial real estate only (at first), but it'll be a sure sign for us rats to flee a sinking ship.
I wonder how this will play out in CA. It’s actually pretty sickening to me. I’ve avoided buying a home because I felt it discriminates against younger buyers. I have a tendency to walk away from what I perceive as unfair deals. You know the type “you just have to take this because we said so” deals.

If and when it is abolished it will send shockwaves across the real estate markets and create mass evictions of the older owners.

Or it will drag on.

Either way it won’t end well.

Salathor
Posts: 394
Joined: Fri Dec 18, 2015 11:49 am
Location: California, USA

Re: Rental accommodation once retired

Post by Salathor »

@SClass

I can't see how it would do anything other than demolish property values in CA.

1) Taxes rise faster than inflation, in line with current CA housing prices
2) Older folks, fixed income, etc., are priced out and forced to sell due to taxes
3) The market floods, and housing prices become depressed
4) Housing values sink and taxes return to the lower values, so the state doesn't win and many folks were forced to move.

I don't see any upside to the plan.

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Sclass
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Joined: Tue Jul 10, 2012 5:15 pm
Location: Orange County, CA

Re: Rental accommodation once retired

Post by Sclass »

I think that pretty much sums it up. Most of the older people I know can not afford the current assessments in their own neighborhoods if they’d bought long ago.

I guess the other possibility is it can just drag on. The old owners will die off and the assessments will step up to current values. That’s kind of what has happened in my mom’s neighborhood in LA. 75% of the homes are owned by younger couples working like dogs to pay a $20,000 annual tax bill. Then there’s the ancients paying $1000 a year. They eventually die and their kids have to sell off the property. So there is a reset of sorts.

I’m debating what to do with my mom’s place. Keep it as a rental? Keep it as a retirement hedge against rising rents? Right now I’m just letting it sit vacant. Prop 13’s worst nightmare. The 1970 assessment that just won’t die.

Kriegsspiel
Posts: 952
Joined: Fri Aug 03, 2012 9:05 pm

Re: Rental accommodation once retired

Post by Kriegsspiel »

Sclass wrote:
Wed Mar 20, 2019 8:57 pm
75% of the homes are owned by younger couples working like dogs to pay a $20,000 annual tax bill. Then there’s the ancients paying $1000 a year. They eventually die and their kids have to sell off the property. So there is a reset of sorts.

I’m debating what to do with my mom’s place. Keep it as a rental? Keep it as a retirement hedge against rising rents? Right now I’m just letting it sit vacant. Prop 13’s worst nightmare. The 1970 assessment that just won’t die.
Yikes. What a disconcerting situation.

cloudeleven
Posts: 15
Joined: Sun Sep 11, 2011 8:17 pm
Location: USA

Re: Rental accommodation once retired

Post by cloudeleven »

I just applied online for an apartment last night in a pretty big apartment complex managed by a corporate property management company. It's my first time renting an apartment, and I'm 40 years old and ERE'd so I don't have any income, just living off my investments. I called them this morning, and surprisingly I was already approved. They didn't even check my income or financial statements. I guess they liked my excellent credit and clean background/no criminal history? Anyway, she did say she wants to see either previous tax form or investment statements before move-in date.

That was surprisingly easy. I thought I'd have difficulty renting a place having no income, just living off my portfolio, especially being my first time renting an apartment. I was feeling kinda intimidated about it.

Interestingly, I called an apartment complex yesterday about 20 minutes away that uses the same online application system as the one I was approved at, and I asked them, "Can you approve someone in 24 hours?" and she said "Oh, people get approved in 5 or 10 minutes!" So I guess it's just a robot automatically approving you based on credit scores/background report...I like that.

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