Other factors influencing the current market are particularly Californian in nature, and can be traced back to a general scarcity of land in desirable locations. Undeveloped land is prohibitively expensive, especially within the metropolitan areas of Los Angeles and San Francisco. Kenny Slaught says that there are regular delays in construction of new projects, resulting in many owners choosing to stay put and renovate instead of relocate. Additionally, Proposition 13, the 1978 amendment to the state’s constitution, has made relocating a daunting option. The law states that future property tax increases are capped at 2% based on 1975 assessments, but the exorbitant exception happens when a sale is executed, and a property is reassessed based on the current sale price. Ultimately, annual totals are framed by purchase figures that fluctuate month to month, as demand in California shifts seasonally with most homes moved in June (with a small increase at year’s end). Also having and impact on yearly totals are things such as asking prices, interest rates, consumer confidence, negative equity status, quantity and quality of homebuyer jobs, disposable income, saving rates, and elements like major foreign investments.
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