Proposition 13’s benefits have been expanded before. Less than a decade after the original measure was passed, it became clear that under the new system, homeowners who had been in their houses for a long time now had a disincentive to downsize because they could lose their favorable tax status. So new “portability” rules were approved by voters allowing homeowners over age 55 (and also disabled people and victims of disasters) to apply the artificially low valuation of their old homes to newly purchased ones that cost the same or less. Under today’s rules, an older couple who buy a house for $400,000 in 1990, sell it for $1 million in 2018 and buy a new one for $800,000 can’t be required to pay more in property taxes.

Source: Los Angeles Times October 08, 2018 11:03 UTC