Prop 60/90: Maybe you're not as "locked in" to your home as you once thought...

Buying a home is a significant financial milestone, but for many prospective homeowners, the high cost of real estate can seem daunting. However, there are several programs and initiatives designed to ease the burden of homeownership and make it more affordable. One such initiative that often goes under the radar is Proposition 60/90. In this blog post, we'll delve into Prop 60/90 and how it can make buying a home more affordable for real estate and mortgage prospects.

What is Proposition 60/90?

Proposition 60 and Proposition 90 are California state laws that offer property tax relief for homeowners who are 55 years young or older. These propositions were established to allow eligible homeowners to transfer the base year value of their existing home to a replacement home, essentially preserving their lower property tax rate.

How Does Prop 60/90 Work?

1. Age and Eligibility: To qualify for Proposition 60/90, you must meet the following criteria:
   

   • You or your spouse must be at least 55 years young at the time of the sale.

   • The replacement property must be located in the same county as the original property (Prop 60) or in one of the participating counties that has opted into the program (Prop 90).

1. One-Time Benefit: This program provides a one-time opportunity to transfer the base year value of your current home to a new home of equal or lesser value. This means that you can downsize or move to a different area without experiencing a significant increase in property taxes.

Benefits of Prop 60/90 for Real Estate and Mortgage Prospects:

1. Reduced Property Taxes: One of the most significant advantages of Proposition 60/90 is the potential for reduced property taxes. By transferring your base year value, you can lock in a lower property tax rate, which can save you thousands of dollars annually.

2. Flexibility in Home Choices: Prop 60/90 allows homeowners to explore various housing options without worrying about skyrocketing property taxes. This flexibility can be particularly appealing for retirees looking to downsize or relocate to a more suitable home.

3. Financial Freedom: Lower property taxes can free up your budget for other expenses, making homeownership more affordable overall. It can also provide peace of mind, knowing that your property taxes won't eat into your retirement savings.

4. Boosting Local Real Estate Markets: For real estate professionals, Prop 60/90 can be a selling point for mature clients looking to move. It can stimulate the real estate market in participating counties, as eligible homeowners may feel more inclined to sell their homes and purchase new ones.

Conclusion:

Proposition 60/90 is a valuable tool for real estate and mortgage prospects, especially for those aged 55 young or older, who are looking to make homeownership more affordable. By transferring the base year value of your current home to a replacement property, you can enjoy reduced property taxes, increased financial freedom, and greater flexibility in choosing your next home. As a real estate or mortgage professional, being well-informed about these programs can help you provide valuable guidance to your clients and assist them in making their homeownership dreams a reality.