AB 1771 - Housing Speculation Act - 25% Tax California Housing Crash
- 2 years ago
https://ab1771.com/ California is doing it yet again! With a new 25% real estate tax. It’s called the Housing Speculation Act or AB 1771. The idea is simple, charge real estate investors and house flippers a 25% tax if they buy and then sell a home in less than 3 years… AB 1771 The Housing Speculation Act impacts everyone including people who must move due to a death, a divorce, a disability, or even a job transfer. (Subscribe to this channel for updates on this crazy California 25% tax that could be coming your way soon).
There is just one big problem! The tax applies to everyone, not just house flippers and real estate investors. This is California, who has ran out of ways to tax our money, so now they are taxing our equity! … So, if you buy a home and live in it for a few years and you decide to sell, you will be subject to a 25% tax, with only a few exceptions that I mention in this video. Oh, and the tax continues until year 7, it just drops by 5% each year after year 3…
So let’s take a look at an example, here in California, home prices have risen by about 50% over the last 3 years. You bought a home for $400,000 and now it is worth $600,000 and you need to sell. Maybe you want to move-up into a bigger home, maybe you have gone through a divorce, maybe you have a disability, or maybe your job is transferring you…sorry you will pay California $50,000 in tax!
AB 1771 The Housing Speculation Act has 2 big potential problems. First, a reduction in the already low inventory… Here in California low inventory and low interest rates has created a perfect storm of too many buyers looking for too few homes and this has driven up prices. AB 1771 will encourage sellers to hold their homes much longer to avoid paying tax, and greatly reduce the already low inventory.
Second, this could crash the real estate market by removing many of the move-up buyers… There are home sellers who must sell due to a divorce, a death, a disability, or a job transfer… in some cases, they could lose $50,000 to $200,000 or more of their equity. This will greatly reduce their ability to move into another home.
Let’s talk about house flippers and real estate investors. House flippers and real estate investors will benefit the most from AB 1771. Yes, I know that sounds crazy! The bill claims to target them direct. How can they benefit the most!
It’s actually really simple, AB 1771 The Housing Speculation Act targets equity or the profit you make when you sell a home. Real estate investors and house flippers have the ability to zero-out their profit by moving income to real estate commissions, carrying costs, rehab expenses, marketing… House flippers and real estate investors can also do a tax-deferred exchange or they can sell the house under terms that limit their profit or extend the profit to avoid the tax.
Follow me on Youtube at http://davidoldenburg.com/
There is just one big problem! The tax applies to everyone, not just house flippers and real estate investors. This is California, who has ran out of ways to tax our money, so now they are taxing our equity! … So, if you buy a home and live in it for a few years and you decide to sell, you will be subject to a 25% tax, with only a few exceptions that I mention in this video. Oh, and the tax continues until year 7, it just drops by 5% each year after year 3…
So let’s take a look at an example, here in California, home prices have risen by about 50% over the last 3 years. You bought a home for $400,000 and now it is worth $600,000 and you need to sell. Maybe you want to move-up into a bigger home, maybe you have gone through a divorce, maybe you have a disability, or maybe your job is transferring you…sorry you will pay California $50,000 in tax!
AB 1771 The Housing Speculation Act has 2 big potential problems. First, a reduction in the already low inventory… Here in California low inventory and low interest rates has created a perfect storm of too many buyers looking for too few homes and this has driven up prices. AB 1771 will encourage sellers to hold their homes much longer to avoid paying tax, and greatly reduce the already low inventory.
Second, this could crash the real estate market by removing many of the move-up buyers… There are home sellers who must sell due to a divorce, a death, a disability, or a job transfer… in some cases, they could lose $50,000 to $200,000 or more of their equity. This will greatly reduce their ability to move into another home.
Let’s talk about house flippers and real estate investors. House flippers and real estate investors will benefit the most from AB 1771. Yes, I know that sounds crazy! The bill claims to target them direct. How can they benefit the most!
It’s actually really simple, AB 1771 The Housing Speculation Act targets equity or the profit you make when you sell a home. Real estate investors and house flippers have the ability to zero-out their profit by moving income to real estate commissions, carrying costs, rehab expenses, marketing… House flippers and real estate investors can also do a tax-deferred exchange or they can sell the house under terms that limit their profit or extend the profit to avoid the tax.
Follow me on Youtube at http://davidoldenburg.com/