Luxury real estate market trends, developments and marketing.

Ouch! California Tax Hike

The voters of California have decided to hike income taxes to levels that are unprecedented anywhere in the nation.

Here’s the gist:

Those who make over $250,000 will pay the highest taxes in the country.
If you make over a million dollars — you will pay an even higher surcharge.

CA Prop 30 Tax Increase

Oh, by the way, this tax is retroactive to 2012… yes, California will be retroactively taking away money that has already been earned.

Wealthy People Have A Target On Their Backs

It’s my opinion that the politicians who run California’s government view business owners and wealthy people as their piggy bank.

Hence, this obscene tax on the higher earners.

From PandoDaily: An oppressive state income tax will not be enough to drive some people out. But it is naive to think that the thousands of young millionaires who are about to get hit by this retroactive tax will not think twice about it when they talk to their financial planners.

In the end, nobody knows for certain how this tax will impact individual decisions. These types of things are incredibly anecdotal in terms of the evidence on either side. Politicians will provide figures to suggest that income tax does not cause exodus, but these taxes are unprecedented, and coming at a time when people are less rooted to California than ever before.

Californians Moving to Nevada

I can tell you, it is already happening:

In the 3 days following the November 6th elections, we—Nevada Luxury Homes—have received a total of 27 phone calls from Californians looking to escape the coming tax burden and move to Reno…

In Nevada we don’t believe anyone owes us a cent—what’s yours is yours. We’re not envious of your success.

Real Estate In Reno Nevada

I have a couple friends who recently purchased real estate in The San Francisco Peninsula.

In both cases, the final sales price was north of $1.2 million.

Now, as a Reno real estate agent I list $1.2 million dollar homes on a regular basis.

BUT, what you get for $1 million in the Bay Area — and what you get for $1 million in Reno Nevada are VERY different.

The Truth About Nevada Real Estate

I understand comparing a house in the Peninsula to a house is Reno is “apples-to-oranges”. But, a duck is a duck… and a tear-down in the Peninsula is a mansion In Montreux!

In other words, a million dollar house in Reno, Nevada is vastly different than a million dollar house in the Bay Area.

When Are You Moving To Reno?

No state income tax, more house for your money, less traffic, skiing 20 minutes away, Jack Nicklaus Signature Golf, clear-blue skies… I could go on…

… There are many reasons to move to Reno—not just to escape California’s brutal taxes.

Contact me to learn more and make your appointment to view luxury real estate in Reno Nevada.

Reality Check For Californians Facing Higher Taxes

California is facing a massive budget shortfall… $15.7 billion.

In this blog post from Reno Luxury Partners, watch and listen to Rick Santelli of CNBC point out the hard truth about California’s $15.7 billion shortfall and how Governor Brown plans to fill that gap.

Click here to view the post.

California Politics and the Effect on Nevada Real Estate

Below is a great article from Investor’s Business Daily about California and the situation the state is in.

The ‘Golden State’ Still Doesn’t Get It

by Investor’s Business Daily

The midterm elections turned into a sweeping repudiation of the Democrats’ failed status quo – except, that is, in California. There, not only did the Democrats not lose, they gained clout.

Even as voters in other states said they’d had enough of ever bigger, more intrusive and higher-cost government by the Democrats, California voters said, “More please.”

With the exception of the governor’s office, California has been a virtual one-party state since the 1960s. Now, thanks to decades of anti-business policies promulgated by a series of left-leaning legislatures, its economy and finances are a mess, and it’s hemorrhaging jobs, businesses and productive entrepreneurs to other states.

This is especially true for Nevada. The tax advantages of Nevada make our state very appealing to savvy business owners and individuals. I get a dozen calls per week from people in California asking about luxury real estate in Reno. Most have already decided to leave the state, now they have to find a place to live.

The pattern continued on Tuesday, when voters rehired 1970s Democratic gubernatorial retread Jerry Brown and rejected moderate Republican and former Hewlett-Packard CEO Carly Fiorina for far-left, five-term incumbent Sen. Barbara Boxer.

How bad has it gotten in the erstwhile Golden State? Consider:

* Some 2.3 million Californians are without jobs, for a 12.4% unemployment rate – one of the highest in the country.

* From 2001 to 2010, factory jobs plummeted from 1.87 million to 1.23 million – a loss of 34% of the state’s industrial base. Ask any company, and it’ll tell you the same thing: It’s now almost impossible to build a factory in California.

* With just 12% of the U.S. population, California has almost a third of the nation’s welfare recipients. Some joke the state motto should be changed from “The Golden State” to “The Welfare State.” Meanwhile, 15.3% of all Californians live in poverty.

* The state budget gap for 2009-10 was $45.5 billion, or 53% of total state spending – the largest in any state’s history.

* The state’s sales tax is the nation’s highest, and its income tax the third-highest, the BusinessInsider.com Web site recently noted. Meanwhile, the Tax Foundation’s “State Business Tax Climate Index” ranks California 48th.

* In a ranking by corporate relocation expert Ronald Pollina of the 50 states based on 31 factors for job creation, California finished dead last.

* In another ranking, this one by the Beacon Hill Institute on state competitiveness, California came in 32nd – down seven spots in just one year.
* California is home to 25% of America’s 12 million to 20 million illegal immigrants. A 2004 study estimated that illegals cost the state’s citizens $10.5 billion a year – roughly $1,200 per family.

* Unfunded pension liabilities for California’s state and public employees may be as much as $500 billion – roughly 17% of the nation’s total $3 trillion at the state and local level.

This has been building for decades. Yet, despite the abysmal track record, Democrats in this election not only won six of the state’s seven top jobs, they extended their hold over the state legislature, too. The GOP gained a record 680 seats in statehouses nationwide on Tuesday. In California, they gained none.

Even Democratic candidate Jenny Oropeza, who died two weeks ago, still managed to defeat live Republican John Stammreich in a race for a state Senate seat.

California really bucked the national trend.

“Democrats had a 13-point party identification advantage among California voters, compared with an even split nationwide,” wrote Jack Pitney, a professor at Claremont McKenna College, on the National Review’s blog. “California voters approved of President Obama’s performance by a 10-point margin, whereas the national electorate disapproved by nine points.

“It’s a different kind of state,” he said. That may be the understatement of 2010.

A large part of the state’s Democratic tilt comes from its massive Latino population. The Los Angeles Times noted that it made up 22% of the voting pool, “a record tally that mortally wounded many Republicans.”

Indeed, Latinos went for Democrats by 2-to-1 – perhaps ending the naive idea of some in the GOP of a New Majority built on the burgeoning Latino population.

But the real political problem lies in Sacramento, the state capital, which is run not so much by politicians as by the unions they’ve sold out to – state employees, nurses, teachers and prison guards.

For their part, politicians have largely ignored the state’s crumbling infrastructure, failing schools and dismal job market. And it’s about to get worse.

Voters also approved a new measure requiring a simple legislative majority to approve a state budget. It previously took two-thirds, giving Republicans far more leverage. Democrats, in other words, will now find it even easier to spend money they don’t have.

Moreover, as its tax base shrivels, the state is lurching ever closer to fiscal insolvency. At some point, it will ask Congress for a bailout, and how likely is that with the new Republican majority?

It is my opinion that not only will Congress bail California out, but they will try to find more and more ways to bring revenues in. If you’re a business owner… look out. Higher taxes and more fees are coming your way. This is great news for Nevada businesses and Nevada real estate.

Worse is the feeling among the state’s businesses of an entrenched, almost pathological antipathy toward any job-creating activity.

As Cypress Semiconductor CEO T.J. Rodgers memorably put it: “The killer factor in California for a manufacturer to create, say, 1,000 blue-collar jobs is a hostile government that doesn’t want you there and demonstrates it in thousands of ways.”

So far this year, thanks to California’s unfriendly political environment, strict regulations and high taxes, 32 companies have announced they’ll either expand elsewhere, move or shut down operations, according to the California Manufacturers & Technology Association.

For many, it’s as simple as ABC – Anywhere But California. This is an issue near and dear to our hearts. Investor’s Business Daily was founded in 1983 in Los Angeles – and for a quarter of a century has proudly called California its home.

But we too have been affected by the state’s poisonous, anti-business political environment. With de facto one-party rule in the state since the 1960s and few signs of change anytime soon, our optimism about the state’s future has begun to wane.

As a result, sad to say, much of IBD’s future growth will happen at a new facility in Texas – where local and state authorities have bent over backwards to make us feel welcome.

California was once like Texas, but lost its way. Today, when comparisons are made, California is most often compared to Greece – another idyllic place with a sunny, Mediterranean climate on the verge of bankruptcy.

In the end, only the voters of California can change things. But on election day, they opted for more of the same governance that will only make conditions worse.

As I said in the beginning, Northern Nevada is a great place to live and run your business. Reno is a great city… beautiful scenery, great restaurants, plenty of things to do! It’s time for you to seriously consider leaving the traffic and smog. Click here to see why we love Reno Nevada

As always, my team and I are here to help you find the best luxury real estate in Northern Nevada and Montreux homes for sale.