California Realtors Rally Around Prop 5

The California Association of Realtors is backing Proposition 5 on the November ballot, which would allow senior homeowners to carry their lower property tax payments to any new home in the state.

The trade group has raised $13 million to support the proposition, claiming it will "unlock" the state's housing inventory, freeing up needed supply, particularly at the entry and trade-up levels of the market. They explain that senior homeowners, which make up 55 percent of all owners in the state, aren't moving because they don't want to lose their lower rates. Yet, other data show that seniors in California move more often than in other states, and that it is not certain that Prop 5 would truly incentivize seniors to move, The Los Angeles Times reports.

Jonathan Kaplan, a senior policy analyst with the California Budget and Policy Center, said the measure is a double whammy for younger, lower-income Californians. Not only could they face higher home prices, he said, but they’d also share the burden of reduced revenues, through a reduction in services or a shift of the tax burden. The estimated revenue loss to schools would cost the state less than 1 percent of the state budget, but that is enough to provide 110,000 children with child care, Kaplan said.

"We have essentially a for-profit association in the Realtors doing what they can to strengthen and enrich their own pockets at the expense of almost every other service that enhances the quality of life in California,” said Brian Rice, president of the California Professional Firefighters, a union that is contributing money to the No on 5 campaign.

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