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 Multifamily News
office requesting preparation of a “title and summary.” Inadequately named the “Housing Affordability and Tax cut Act of 2022,” the proposal is a mere wealth transfer in disguise that would penalize owners of properties with full cash (assessed) values of $5 million or greater through a property tax surcharge of 1.2% or more, and a prorated, lesser surcharge amount for properties with full cash (assessed) values between $4 million and $5 million.
Under the proposed initiative, “covered properties” include any commercial, residential, industrial, or mixed-use real estate, or vacant land with a full cash value of $4 million or more. Certain types of properties are exempt from the surcharge, including commercial agricultural land, deed restricted properties that house “low” and “very low” income residents, and vacant land protected and used for open space, among others.
Under California law, “full cash value” means “the county assessor’s valuation of real property as shown on the 1975–76 tax bill under ‘full cash value’ or, thereafter, the appraised value of real property when purchased, newly constructed, or a change in ownership has occurred after the 1975 assessment” [Section 2 of Article XIIIA of the California Constitution].
The proposed initiative benefits homeowners by increasing the $7,000, current homesteading exemption to $200,000, which would save homeowners approximately $2,000 in property taxes each year. In addition, the proposal seeks an increase in the renters’ credit and also seeks to encourage housing development and construction by streamlining local government approvals.
City of Inglewood: Current Allowable Annual Rent Increases
With the annual Consumer Price Index (CPI) at approximately 3.6%, the City of Inglewood recently published its allowable, annual rent increase amounts for rental properties with four or fewer units at 8.6% (5% plus CPI) and for 5 or more units at 3.6% (CPI or 3%, whichever is greater). For rental units charging 80% or less than the “Fair Market Value” rents and upon approval of the City, the allowable annual rent increase amount for rental properties with four or fewer units is 10% and for 5 or more units the allowable increase is 8.6%. The applicable fair market value rents are included below:
80% OF FMR
70% OF FMR
$1,384.00 $1,604.00 $2,044.00 $2,693.00 $2,933.00 $3,372.95
$1,107.20 $1,283.20 $1,635.20 $2,154.40 $2,345.40 $2,698.36
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