What are Mello-Roos taxes? (San Diego, Chula Vista: real estate, renting, HOA)

[Charles]

Originally Posted by Donn2390

And it does expire. If you buy a 20 year old home, you only pay the remaining 20.

This is correct, but the explanation sounds odd.

Correct me if I am wrong, this is the way our worked: The Mello Roos expires when it expires (for example 15 years after it was initiated). If you purchase an eight year old home then the Mello Roos expires in seven years.

[kookooroo]

Originally Posted by Donn2390

It is the old adage, "You can pay me now, or pay me later" If the developer picks up the bill, they raise the cost of the house If the builder doesn't pay the bill for the infrastructure, then you get mello roos taxes.
Either way you pay the bill. It's another form of creative financing..!
And it does expire. If you buy a 20 year old home, you only pay the remaining 20.

Which setup is preferable: new home with "no MR" (pay now) or new home with MR (pay as you go) if you plan to live there for 5 years and then sell? Does no MR or MR make any difference to a future home buyer when you try to sell your house?

If you have 2 $800k new houses in the same area, one has MR and the other one is "no MR". Does it mean the "no MR" house should be of lesser quality due to the built-in MR? How do you figure out the amount of the built-in MR so you know the actual cost of the "no MR" new house?

Thanks!

[JohnSoCal]

Originally Posted by shadow42

You can definately have a mello-roos tax on a condo or townhome. It is the area you live in that dictates the tax rate. For example....Costa Mesa is an older area and with no mello-roos tax. Even new homes there do not have mello-roos tax because the infrastructure of the area already exists...ie schools, roads, shopping centers...etc. However, a brand new area such as Ladera Ranch or any of the new communities in Irvine off the 405 will definately have a mello-roos because they will need to build all that stuff.

Mello-Roos is dependent on the development, not the city or county.

[JohnSoCal]

Originally Posted by kookooroo

Which setup is preferable: new home with "no MR" (pay now) or new home with MR (pay as you go) if you plan to live there for 5 years and then sell? Does no MR or MR make any difference to a future home buyer when you try to sell your house?

If you have 2 $800k new houses in the same area, one has MR and the other one is "no MR". Does it mean the "no MR" house should be of lesser quality due to the built-in MR? How do you figure out the amount of the built-in MR so you know the actual cost of the "no MR" new house?

Thanks!

It is much better to have the developer include the costs of the infrastructure in the price of the home.

[TurcoLoco]

Gotta love the 40-year mello-roos bonds. You pay for it, so others, who move there later on, can enjoy the community for free.
Brilliant!

[i_love_autumn]

Originally Posted by JohnSoCal

Mello-Roos is dependent on the development, not the city or county.

So which areas of San Diego have no Mello-Roos or HOA fees? I'd like to avoid those!

[JohnSoCal]

Originally Posted by i_love_autumn

So which areas of San Diego have no Mello-Roos or HOA fees? I'd like to avoid those!

Mello-Roos fees are determined by the development and not area. It is a matter of whether the developer paid for it up front or not. If they did then there are no fees to the home owner. HOA fees are different.

The listings will usually state if there are no Mello-Roos as it is an important selling factor. It may list it as low tax which means no fees.

[Beachbum85]

Is there a website or some place you can go to research when the MR bond expires for a specific area/development?

[pacific2]

Originally Posted by Beachbum85

Is there a website or some place you can go to research when the MR bond expires for a specific area/development?

I don't know of such a site, so I would suggest you either check the website for your city of interest, or call their Department of Financial Services.

In the meantime, you can easily discover the current Mello-Roos tax for any property you may be considering, by entering the parcel number, or address, at the Orange County Tax Assessors website.
http://tax.ocgov.com/tcweb/search_page.asp

Examine the breakdown of taxes for the property.

[pacific2]

FWIW, or not, here is my 2c on Mello-Roos in OC; particularly as it relates to my city.

Originally Posted by pacific2

Also, it's not as though the money goes up to either the state, or even county level, it stays in the community.

That said, it always pays to be watchful.
{Long example follows; possibly too much information}

About 11 years ago, two residents in a CA city (Mission Viejo) neighboring mine (Aliso Viejo) wanted some answers since they noticed that the schools in their city were deteriorating, while those in Aliso Viejo (same school and Mello-Moos district) were in great shape. They fought long and hard, and uncovered gross inequities.

Not only was Mission Viejo being shortchanged, but both Aliso Viejo and Mission Viejo were sending far more than their share to support the very large school district (Capistrano Unified) in which some cities actually have no Mello-Roos, but their school kids still reap benefits from these taxes.

For example, AV and MV taxpayers together recently paid $14.3 million dollars of the total $19.8 million dollar cost of a new school district headquarters; one serving multiple cities in the district. What's more, there was no end-date for the tax.

As a result, without admitting any "wrongdoing," ( no lawsuits, but some 'splainin was needed) but finally admitting that the situation was not equitable, the district has decided to retire Mello-Roos taxes in 2016. Depending upon the development, some Aliso Viejo homeowners actually pay as much as $7,000/year, others far less, and still some pay none.

Taxpayers in Aliso Viejo, Mission Viejo to Save up to $42 Mil - Schools - Aliso Viejo, CA Patch

Our individual neighborhoods, SFRs and townhouse/condo, are maintained by HOA fees. Again, residents benefit, not the state, although management styles vary according to the particular HOA, and people can opt out by not living here. BTW, many Aliso Viejo businesses also belong to, and run, their own HOAs.

Finally, there is also a city-wide HOA (low yearly fees) in our city, and it is mandated with maintaining our parks, trees and slopes. It also sponsors outdoor activities.

Again, we benefit, not the state.

Whew! That's a mouthful.