California Looking To Add 25% Tax On Homes Bought & Sold Within 3 Year Span

A new bill is aiming to give average people a chance to own a home again. Assemblymember Chris Ward from San Diego has introduced the California Housing Speculation Act or Assembly Bill 1771 which would change real estate tax policy and discourage some investors from quickly reselling properties like single-family homes.

Ward is proposing an additional 25% tax on the gain from the sale starting January 1, 2023. According to Ward, research shows U.S. investors bought a record $63.6 billion worth of homes by late 2021.

“But we’ve also seen this influx of short-term investors trying to get into the market, outbid San Diegans and Californians with all-cash offers, and drive the prices up for everyone” Ward told CBS8.

Norm Miller, a real estate professor at the University of San Diego said the Bill may help but California's tax laws still favor investors.

Ward continued, "... if somebody’s trying to go in there, fix up a fixer-upper and then sell it for record profits, that is distorting the market because somebody else could have gone in there, done the same and kept the home."