Chris Hoene, executive director of the California Budget and Policy Center in Sacramento, says that local governments need to boost local property taxes to gain flexibility to address housing costs in their areas.
Because of Prop. 13, the voter-backed measure that limits tax hikes on properties until they’re sold, local governments have to raise money from development fees, which discourages homebuilding, Hoene said.
Prop. 13 also limits the local government’s ability to finance affordable housing projects while discouraging existing homeowners from making improvements such as building more units on their properties, he said.
“[I]t doesn’t make sense for people to scream and yell about an affordability crisis and not take on the single biggest financing mechanism problem in the state.”
California is rapidly becoming a renter majority state, with 54 percent of households owning their own homes, the second-lowest homeownership rate in the nation. Because fewer renters can afford to buy a home, they are trapped in housing with rapidly escalating rents.
Read the whole story in the Orange County Register
Categories: Sacramento Update