Prop 13, Prop 19 and leaving California: what changes with your property tax
Long-time LA owners often pay property tax on a value far below today's market. Here's general background on what happens to that when you sell, keep or pass on the home, and what Prop 19 does and doesn't cover.
If you've owned your LA home for a long time, there's a good chance your property tax bill is based on a value well below what the home would sell for today. That's Proposition 13 at work. When people start planning a move out of state, a common question is what happens to that low assessed value. The general answer is that it stays with the property in California, not with you. Below is background to help you ask the right questions. It's general information, not tax or legal advice, so please verify anything that applies to you with a CPA, an attorney or the county assessor.
How Prop 13 works, in brief
Under Prop 13, a California home is generally assessed at its purchase price when it's bought (its "base year value"). After that, the assessed value can rise each year by an inflation factor tied to the California Consumer Price Index, capped at 2%. The general tax rate is 1% of assessed value, plus any voter-approved local bonds and assessments. The State Board of Equalization explains this in its property tax overview (Publication 29).
Say someone bought an LA home in 2004 for $600,000. Even if the full 2% factor applied every year for 22 years, the assessed value would be at most about $928,000 in 2026, and in years when inflation ran lower it would be less. If the home's market value today were $1.8 million, the owner's general 1% levy would be based on roughly half of what a new buyer would pay. This is a simplified illustration that leaves out local levies, exemptions and any new construction.
If you sell
A sale is a change in ownership, so the buyer generally starts fresh with a new base year value at their purchase price. For the seller, the low assessed value simply ends with the sale. It doesn't follow you to another state, because each state runs its own property tax system. Your new state and county will assess your new home under their own rules.
What Prop 19 does, and where it stops
Proposition 19, effective April 1, 2021, lets certain homeowners carry their factored base year value to a replacement home. According to the Board of Equalization's Prop 19 page (checked October 2026), the general outline is:
- The owner must be at least 55, severely and permanently disabled, or a victim of a wildfire or governor-declared disaster.
- The replacement home must be in California, and bought or newly built within two years of the sale.
- The transfer can be used up to three times.
- If the replacement costs more than the original (with some allowance in the first and second years), the difference is added to the transferred value.
- The claim is filed with the assessor in the replacement home's county, not through escrow.
The key point for this site's readers: Prop 19 transfers only work for a replacement home in California. If you're moving to Arizona, Texas or anywhere else out of state, there's generally nothing to transfer. If you're weighing a move within California, such as to Sacramento or San Diego, Prop 19 may be worth a closer look with a professional.
If you keep the home and rent it out
Moving out and renting the home isn't a change in ownership, so in general the assessed value stays where it is. One thing that usually does change: the $7,000 homeowners' exemption only applies to an owner's principal residence. The BOE notes that rentals and vacation homes don't qualify (BOE information sheet). Renting raises plenty of other questions too, which we cover in our guide on whether to keep or sell your LA home when you move.
If you plan to pass the home on
Prop 19 also narrowed the parent-child exclusion for transfers on or after February 16, 2021. Per the BOE, the exclusion now generally applies only to a home that was the parent's principal residence and becomes the child's principal residence within the required time, and only up to the factored base year value plus an adjusted $1 million ($1,044,586 for transfers from February 16, 2025 through February 15, 2027). A home that becomes a rental, or that the heir doesn't live in, is generally reassessed. For owners who are leaving LA but thinking about keeping the house for the next generation, this is an important conversation to have with an estate attorney before deciding.
A parent who has moved to Nevada keeps their LA home as a rental. If the home later passes to a child who lives in Colorado and keeps renting it out, the home would generally be reassessed to market value under Prop 19, because it isn't the child's principal residence. Real outcomes depend on the facts, timing and paperwork.
What to ask before you decide
- What's our current assessed value, and what would a buyer's assessment roughly be? (The LA County Assessor shows assessed values by parcel.)
- Are we considering any replacement home in California, and do we meet the Prop 19 eligibility rules?
- If we keep the home, what happens to the homeowners' exemption and our insurance?
- If we intend to leave the home to someone, how would Prop 19 apply to them?
- How will property taxes work in the state and county we're moving to?
Selling also has income tax questions of its own, separate from property tax. We cover the general background in Does California tax my home sale after I move?
General information only, not tax, legal or financial advice. Rules, dollar amounts and dates above are from the California State Board of Equalization as checked in October 2026 and can change. Verify your situation with a CPA, an attorney or the LA County Assessor. Tyler Drinkwater, Revel Real Estate, CA DRE 02112336.
