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I live about 15-20 mins away from Apple and Netflix. The house next to ours has been empty for more than 2 years (as long as we lived in the neighborhood). Once a year, a Chinese lady (other neighbors say she lives in China now) appears in it for a day or two. The house is not for sale or rent and its estimate is over 1.5M.

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I don't see how this is a good investment for them. Keeping it empty means, they're loosing 1.3% + the cost of maintenance, HOA, and insurance (1.6% total) every year. And since we're towards the top of the 12 year micro bubble, the long term appreciation won't be significantly more than inflation.

It's an hedge, in case their capital in China gets in trouble.

Sounds like Vancouver, Toronto, Seattle, etc, where tons of capital flight from China has poured into real estate that sits vacant

The other part of that story is that due to Prop 13, you have old ladies living in 5 bedroom houses by themselves because if they downsize, their tax basis gets recalculated. So they might pay $5k per year on that big, expensive house but they might end up with $10k per year if they move to a much cheaper house directly next door.

old ladies should be able to keep their houses if they chose to once the house is paid of and they retire.

Stories I’ve heard are more like $3-5k on that big house they inherited changes to $20-30k on that down-sized house they moved into — that is, a 4x-10x increase, not just 2x.

What shocks me most is when I hear this story and learn that the downsizers (not always old) is shocked by their tax bill — they don’t know about prop 13 and no one told them!

California homeowners 55 and older can get a one-time opportunity to sell their primary residence and transfer the property tax assessment to a new home under Proposition 60. The caveat here is the market value of the new house generally must be lower or equal to the home being sold. For married couples, only one spouse must be 55 or older.

ONLY when moving within the same county, or to one of the 9 (?) that accepts such transfers.

Prop 5 would have applied statewide and would have freed up thousands of such homes in the Bay Area.

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