The fact that undeveloped land is not available in California, especially in Los Angeles and San Francisco where the prices are too high, is why the state’s property market is changing. There are also many delays in construction of new buildings, as Kenny Slaught notes. This results in most homeowners renovating their current homes instead of relocating. Proposition 13 is also a reason why people don’t relocate. While laws say that future property tax growth cannot exceed 2%, this changes when a home is sold and reevaluated by its present value. Ultimately, annual totals are calculated taking into account that the real estate market in California changes with season. Most properties are sold in June, with some sales being finalized in December. These annual totals are also impacted by asking prices, negative equity status, employment of homeowners, as well as large foreign investments.
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