Proposition 19: Key Facts for San Diego Homeowners and Real Estate Investors
California Proposition 19, passed by voters in 2020, brought major changes to the state’s property tax laws. For homeowners in San Diego County—especially those buying or selling high-value homes—understanding Prop 19 is essential for making informed financial decisions.
Who Qualifies for Prop 19 Tax Transfers?
Prop 19 allows certain California homeowners to transfer the taxable value of their existing primary residence to a new home anywhere in the state, potentially saving thousands in property taxes. To qualify, the homeowner must be:
55 years of age or older
Severely disabled
A victim of a wildfire or other natural disaster
This tax base transfer can now be done up to three times (previously it was limited to once), and applies to homes purchased or newly constructed on or after April 1, 2021.
If the replacement home is of equal or lesser value, the original tax base carries over. If the new property is more expensive, the difference in market value is added to the original base. This provides significant savings—especially in high-cost areas like La Jolla, Rancho Santa Fe, or Coronado.
What About Inherited Properties?
Prop 19 also tightened rules around the inheritance of real estate. As of February 16, 2021, parents can still transfer a primary residence to children without reassessment, but only if:
The child moves into the property and designates it as their primary residence, and
The home’s market value is no more than $1 million above its assessed value (adjusted for inflation).
If the market value exceeds this threshold, a partial reassessment is triggered, and property taxes may increase accordingly.
Why It Matters in San Diego
In San Diego’s luxury real estate market, Prop 19 creates both opportunities and limitations. It gives qualifying homeowners the flexibility to move without losing long-held tax benefits. At the same time, it limits the ability to pass down family property without a tax hit unless specific conditions are met.
Final Thoughts
For buyers and sellers navigating high-value transactions, Prop 19 can play a major role in estate planning and long-term financial strategy. Homeowners are encouraged to consult with a tax advisor, estate attorney, or their county assessor’s office to understand how the law applies to their specific situation.
