On December 11, 2018, the cities of Oakland and Berkeley certified the results of the November 6th election. The election brought the passage of several new property taxes and laws that will affect homeowners, vacant land owners and buyers/sellers throughout the East Bay.
Here is what you need to know:
Oakland Vacant Property Tax: Taking effect some time after 2020
- Imposes a parcel tax for properties in use less than 50 days during a calendar year
- Residential homes: $6000 per parcel
- Non-residential and Undeveloped: $6,000 per parcel
- Condominium or duplex: $3,000 per vacant unit
- Parcel with ground floor commercial: $3,000 per parcel
Our local association, Oakland/Berkeley Association of REALTORS is monitoring and will provide us updates to pass onto you as to how the City Council will decide how to administer this tax.
Oakland Transfer Tax- Effective January 1, 2019
Graduated real estate transfer tax rate as follows:
- 1% up to $300,000
- 1.5% over $300,000 – 2 million
- 1.75% over $2 million to 5 million and
- 2.5% over $5 million
-Lowers rates for low-moderate first-time homebuyers
-Reduction of the tax up to ⅓ for seismic retrofit or solar energy work costs incurred by low-moderate income homebuyers.
Oakland Just Cause Restrictions/Evictions Defenses: Effective December 21, 2018
-Removes 2 and 3-unit owner-occupied exemption from Just Cause ordinance
-Grants City Council new authority to add eviction defenses, and, according to rent control opponents, makes it harder for owners to keep control of properties.
Berkeley Accessory Dwelling Unit (ADU) Exemptions to Just Cause/Rent Control – Effective Immediately
- Exemption from Just Cause and Rent Control for all owner-occupied properties with a legally permitted ADU.
- Applies to all ADU tenancies started after November 7, 2018.
Berkeley Transfer Tax- Effective January 1, 2019
-Tax is raised to 2.5% for all properties over $1.5 million.
-Tax will be adjusted annually to only capture top 33% of transfers.
Berkeley General Obligation Bond – To be paid by taxpayers for the next 36 years.
- Homeowners will be taxed approximately $23 for every $100,000 of the assessed value of their home annually.
- $135 million bond that is required to be spent on affordable housing in Berkeley.
Richmond Transfer Tax – Effective January 1, 2019
Graduated real estate transfer tax rate as follows:
- 1.25% on transfers of property sold for an amount equal to or more than $1 million and less than $3 million.
- 2.5% on transfers of property sold for an amount equal to or greater than $3 million and than or equal to $10 million.
- 3% on transfers of property old for an amount greater than $10 million.
- The transfer tax would not change for transfers of property sold for an amount less than $1 million.
El Cerrito Transfer Tax – Effective January 1, 2019
- 1.2% on transfers of all property in the city of El Cerrito.
Albany Parcel Tax- Effective January 1, 2019
- $69 parcel tax on single family homes for parks, open space and related facilities.
- Effectively replaces the $69 bond assessment for single family homes paid since 1996 for parks and maintenance of open space.
Here are articles that discuss how some of these taxes/laws were created and why and what they hope to accomplish:
Oakland Taxing Vacant Properties To Help East Homelessness
https://www.kqed.org/news/11689739/oakland-wants-to-tax-vacant-properties-to-help-ease-homelessness
Real Estate Transfer Tax Increase Considered in Oakland and Berkeley
Berkeley Hills Realty plays an active role in our local real estate association to help protect private property rights and supports housing advocacy, along with our fellow REALTORS in Alameda and Contra Costa Counties and throughout California.
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