Other elements influencing the current situation that are particularly Californian in nature are the result of a general scarcity of land in desirable locations. Undeveloped land prices are prohibitively high, especially around the Los Angeles and San Francisco metro areas. Kenny Slaught points to regular construction delays on new projects, which cause many owners to stay put and renovate instead of relocating. Proposition 13, the 1978 amendment to the state’s constitution, makes relocating a daunting choice as it is. Though the law states that future property tax increases max out at 2% based on 1975 assessments, the exorbitant exception happens when a sale is executed, and the property is reassessed based on current value. Ultimately, yearly totals are the result of purchase figures that vary monthly, as demand in California shifts seasonally (with the highest number of homes moved in June and a small bump at year’s end). Also affecting yearly totals are asking prices, consumer confidence, negative equity status, quantity and quality of homebuyer jobs, disposable income, saving rates, and elements like major foreign investments and interest rates.
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