While Proposition 13’s precise inequitable effects are complicated, more inclusive and less legally tenuous alternatives exist. The California Housing Finance Agency notes that “for the entire 2010s, California’s Black homeownership rate has been lower than it was in the 1960s, when it was completely legal to discriminate against Black homebuyers.” Parents can also pass low tax assessments on to their children, exacerbating the problem. People may stay put to hold on to a tax advantage, limiting inventory and driving up home costs. In California, Proposition 13’s overbroad system protects the propertied at a high cost to more diverse, first-time buyers. Is it because they’re Black?Ī group of Black customers is suing Wells Fargo, claiming the bank slow-rolled or denied them loans based on race. Ĭalifornia Column: Wells Fargo denied well-off borrowers low-interest loans. Like Tyler in Minnesota, many residents were forced out of their homes through tax foreclosures. Yet as real estate values declined in Detroit, those limits did not ensure that assessments fell to match, leaving low-income Black homeowners with inflated, unaffordable taxes. Michigan also limits the amount that an owner’s assessment can rise. Activists in the 1970s and 1980s invoked stories of elderly widows losing their homes to convince voters that property taxes should be based on a home’s purchase price and allowed to rise just 2% a year from there, regardless of market value.īut such assessment limits have not lived up to their promise to protect homeowners. Ironically, people just like Tyler were the original faces of the battle to enact Proposition 13 in California and similar measures around the country. Recent estimates show that Proposition 13 gives the average homeowner in a white neighborhood of Oakland, for example, a tax break of nearly $10,000 each year - more than triple the break provided to average homeowners in Latino neighborhoods, and about double those in Black and Asian neighborhoods in Oakland. The effects of such property taxes on homeownership’s demography suggest violations of the 1968 federal Fair Housing Act. Assessment caps benefit long-standing homeowners - who are often white - at the expense of their more diverse neighbors who arrive later. Proposition 13 raises race discrimination concerns. Hahn upheld Proposition 13’s legality and established its feudal - and unfair - nature.

The Supreme Court’s blessing in Nordlinger vs.

Real Estate What will an ADU do to your property taxes and resale value?įully permitted accessory dwelling units are so new, appraisers say, there’s too little information to say with much certainty how much value they add to a home. Gorsuch characterized during oral arguments as being “about lands owned by the feudal lord and what happens when a vassal fails to provide enough wheat to his lord.” It rejected Hennepin County’s legal reliance on the 13 th century Statute of Gloucester, a law that Justice Neil M. The Supreme Court proclaimed that this money grab was unjust and unconstitutional under the 5th Amendment’s takings clause.

The county seized her condominium and sold it, keeping the entire proceeds - $40,000 - not just the $15,000 she owed. Over several years, the tax debt accumulated to $2,300, exploding to $15,000 when penalties and fines were added. The Minnesota case began when Geraldine Tyler failed to pay the taxes on her longtime Minneapolis home. Hennepin County serves as a warning about legal defects in other property tax laws that unfairly harm communities of color, including California’s own Proposition 13. Late last week, the Supreme Court unanimously ruled that a decades-old Minnesota property tax law was unlawful when it allowed the government to seize wealth from an elderly Black homeowner.

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