Here’s how Mello-Roos taxes work here in California.
One of my clients recently asked me about Mello-Roos taxes and how they affect new homes. I want to discuss them briefly in case you hadn’t heard of them either.
A Mello-Roos is a special tax assessment district created in California to finance local infrastructure and services, such as schools, fire departments, streets, etc.
If you were buying a home in a Mello-Roos district, the cost will typically be about 1% of the purchase price. This is $6,500 per year on a $650,000 home. It’s a 25-year payment plan that can add another $160,000 in value to the home.
Mello-Roos tax money helps builders out because they don’t have to put the money up for the schools and parks. For buyers, instead of buying an existing home in another area for $812,500, you can get the same house for $650,000 in a Mello-Roos district with great new parks, schools, and streets.
“It’s typically billed as a 25-year payment plan.”
If you have questions for me about Mello-Roos or anything else related to real estate, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.