Buying / Selling Real Estate

Proposition 13 established a maximum property tax rate of one percent (1%) of the assessable value of a property. This 1% may have additional tax rates added to it depending on the level of indebtedness assigned to property owners to finance voter authorized expenditures. In other words, the tax rate is 1% plus whatever tax rate is assigned to pay for school bonds, infrastructure, and other voter approved public projects.

Important Dates for Property Owners:

Jan 1: Lien date – taxes for the next fiscal year attach as a lien on the property. The assessment of property applies as of 12:01 a.m. on the first day of January of each year.

If a seller is a foreign individual or corporation, buyers are required to withhold, report, and transmit to the IRS 10 percent of the total purchase price of real property.

In 2003 California amended its real property tax law such that 3.33% of the property SALE price must be withheld buy the buyer.

How many people can live in your unit? Can you run your business from home? These questions are answered in part based on the zoning restrictions as they pertain to your property.  Zoning restrictions exist throughout San Francisco and vary greatly by neighborhood.  The buyer of a property is responsible for confirming the applicable zoning restrictions of that property.  Sellers are required however to supply the buyer with copies of reports pertaining to use of property.  Zoning restrictions do change though so every buyer is urged to inquire as to the current restrictions as well as any that are pending.