Other major influences on the current market are particularly Californian in nature, and can be traced back to a general scarcity of land in desirable areas. The costs for undeveloped land are prohibitively high, most notably within the Los Angeles and San Francisco areas. Kenny Slaught points to consistent delays in new construction, which results in many owners electing to stay in their current homes and renovate, as Proposition 13, the 1978 amendment to the California constitution, has made relocating a unnerving choice. While the law states that future property tax increases are capped at 2% based on 1975 assessments, a major exception takes place when the property is sold, and is reassessed based on its current sale price. Yearly totals are ultimately framed by varying purchase figures, as demand in California shifts monthly (most homes are moved in June with a small increase at year’s end). Also affecting yearly totals are asking prices, interest rates, negative equity status, quantity and quality of homebuyer jobs, disposable income, saving rates, and elements like major foreign investments and consumer confidence.
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