The Golden State is the place where vision becomes reality, no matter what type of California dreamer you are.

If you’re deciding where you should live and California is on the table, you’ll first want to know where to look and how to make your first dream – buying a house in California – come true.

Why Buy A House In California?

California real estate can be a great investment. According to the California Association of REALTORS® Housing Market Forecast, there is a high demand from homebuyers and home-price appreciation is expected to continue rising in 2022.

Along with a great investment, California homes can be a great lifestyle improvement, with beautiful beaches, scenic mountain views and action-packed amenities. Just see what our picks for the best places to live in California have to offer.

Things To Know About Buying A House In California

Some California real estate laws can make the home buying process smoother than in other states and help home buyers make an informed decision on what house to buy. However, some laws have their disadvantages. Make sure you understand these important factors when buying a home in California.

Dual Agency Is Permitted

Dual agency means that buyers and sellers can be represented by the same agent, which is not allowed in many other states. For an agent to act as a dual agent in California, they must have consent from both the buyer and the seller in writing.

While working with a dual agent could streamline the process, help you avoid communication issues and possibly save you money on commission, the agent may find it difficult to act in the best interest of both parties, which could negatively affect you.

You May Have To Pay Mello-Roos Taxes

California has special districts known as Mello-Roos Community Facilities Districts. They’re set up by local governments in response to Proposition 13, which limits property taxes and, thus, the local government’s ability to finance certain projects and services.

As a workaround to the Proposition, the Mello-Roos tax assesses the property’s land, not the value of the property, as property taxes do. The amount charged is different for each district and each home.

This tax helps fund local infrastructure, parks and educational facilities along with services like fire, police and medical emergency response. It is only paid by homeowners within that district.

Real estate agents must disclose that a home is in a Mello-Roos Community Facilities District. If you’re considering moving into one of these districts, consider the extra tax burden it may have on your household and the negative impact it could have on your future home sale.

Seller’s Disclosure Reports Are Robust

A Seller Disclosure is a document that lists all the known issues with the home and any past remodeling work on the home. While some states do not have many disclosure laws, California is highly regulated in this important part of the home buying and selling process.

In California, home sellers are required to submit lengthy disclosures on physical condition, natural hazards and environmental concerns. Considering California is located on earthquake fault lines and routinely experiences earthquakes, wildfires and flooding, these disclosures are vital.

Sellers are only required to list issues they know about. These may include:

  • Roof and foundation issues
  • Electrical, water or HVAC problems
  • Natural hazards
  • Lead asbestos, radon or mold present in the home
  • Legal issues concerning the property
  • Death on the property

Your real estate agent must also disclose any information they have on the home. By California law, the seller or real estate agent must also complete a Natural Hazard Disclosure (NHD) report, which determines whether the property is in a hazard area.

You can also find more information on the home with a Comprehensive Loss Underwriting Exchange (CLUE) report, which provides past insurance claims for the property. You can only obtain a CLUE report with the seller’s permission.

It’s important as a buyer to investigate and do your due diligence before making an offer on a house. In addition to reviewing the Seller’s Disclosure, try to attend open houses, research the neighborhood, and get a home inspection and appraisal to ensure the home is worth pursuing.

Attorneys Are Not Required

Some states require a lawyer to represent both the seller and the buyer at closing, but California does not. While this can save you money and may speed up the process, it may be worthwhile to hire a local closing attorney or escrow agent if you have questions that your agent cannot answer, are a first-time home buyer or if the transaction is more confusing or complicated than originally thought.

Presence At Closing Is Not Required

California law allows buyers and sellers to be represented by real estate brokers and agents at the closing table. This can be an advantage to both buyers and sellers since they won’t need to worry about scheduling conflicts holding up the actual closing.

An experienced local real estate agent, like Carlos G, can be your best option to achieve a desirable outcome. San Diego agents are familiar with local market conditions and can provide guidance on pricing your home and making repairs without spending more than you need to.