PALM SPRINGS REAL ESTATE & DESERT HOMES
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About the Property Taxes and Income Taxes when you own a property in California
What are the Implications for Canadians or any Foreign Nationals , on their taxes when they buy properties in California
The primary question for second homes buyers whether you are US residents or Foreign nationals is "how much property taxes do we pay in California" ? I will say that traditionally the property taxes have been: Approximately : 1.25% of the selling price of the property .
At the time of resale additional taxes come into place:
- As a foreign national you will have a 10% withholding in escrow for a period of one year until all taxes and utilities are verified to have been paid. That amount that will be refunded at the end of that period if all clear.
- Also an additional 3 1/3 % of the selling price of the property is paid by all second homes owners in California whether you are US resident or foreign national.
The Home Buying Process
1. Select a Realtor/establish a relationship.
2. Initial consultation with your REALTOR to evaluate your needs and resources.
We will meet to discuss your needs and analyze your resources.
3. Find the right home for you.
I will show you homes based upon the criteria that we have established together. The more precise and direct you are with me, the more successful our search will be.
4. Determine the seller’s motivation.
Once we have found the home that you wish to purchase, I will do the necessary research to help structure a successful offer.
5. Write the purchase offer.
I will draft the “purchase Agreement” for you, advising you on protective contingencies, customary practices, and local regulations.
6. Present the offer.
I will present your offer to the seller and the seller’s agent and I will negotiate for you the best price. I will review the seller’s response with you. My negotiating skills and knowledge will benefit you in reaching a final agreement.
7. Open escrow.
When the purchase agreement is accepted and signed by all parties, I will open escrow for you. At this time your earnest money will be deposited. The escrow company will receive, hold and disburse all funds associated with your transaction.
Escrow : A procedure in which a third party acts as a stakeholder for both the buyer and the seller, carrying out both parties ’instructions and assuming responsibility for handling all the paperwork and distribution of funds
9. The contingency period.
This is the time allowed per your purchase agreement to obtain financing, perform inspections, and satisfy any other contingencies to which your purchase is subject.Traditionally this period is 17 days (could shrink down to 7 days when buying a bank owned property)
Typical Contingencies include:
- Approval of the seller’s transfer disclosure statement.
- Approval of the preliminary report from the title company.
- Loan approval, including an appraisal of the property.
- Physical inspections of the property.
- Pest inspection and certification.
10. Close of escrow!
You will deposit the balance of the moneys and closing costs into escrow The deed will then be recorded at the County Recorder’s office and you will take ownership of your new home!