5 Things to Consider When Buying a Home in California

5 Things to Consider When Buying a Home in California

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California is a massive state with nearly 40 million people, and that alone makes it an incredibly competitive real estate market. Buying a home in California requires you to move quickly and have your ducks in order. Don’t jump at a home too quickly though!

Buying a home is a major investment. Once you take the plunge, you’re stuck with a home loan and all the expenses that come with home ownership. Here are some things to look for when buying a home in California before you signed on the dotted line(s).

Age of the Home

California has been a popular hot spot for aspiring actors, technology gurus, and industry innovators for decades, if not centuries. As a result, many of California’s best places to live have older homes.

Old California Houses

The age of the home is one of the most important factors that many Californian buyers overlook. Even if a 100-year-old home was properly cared for, it can still need some expensive maintenance and repairs.

It’s important to have emergency savings, just in case your new-to-you home is in need of major renovations or repairs!


There’s no other way to put it: California is suffering from a growing population paired with a lack of water. In short, California experiences frequent droughts. The water shortage is so bad that many cities ration water. For example, you may not be allowed to water your lawn on certain days of the week.

California Drought

Researchers have determined that California’s droughts have lasted as long as 20 years over the past 1,000 years. Through sediment and other natural evidence, scientists discovered that a 240-year drought began in 850. Another 180-year drought began in 1140.

Related: Need to conserve energy? We’ve got a¬†dozen tips to help you out!

Make sure you take your water usage and restrictions into consideration before you buy a home in California!

Natural Disasters

As much as we hate to say it, California is prone to natural disasters. The state sits on the San Andreas Fault. Scientists tend to agree a major earthquake is inevitable. The only question is when, where, and how much damage it will do.

California Earthquake Insurance

Regardless of where you plan to live in California, earthquake insurance is an absolute must-have! A simple insurance policy could save you hundreds of thousands of dollars in damages.

Although California is located near the ocean, it’s still prone to near-annual wildfires as well. All you have to do is take a look at the California Wildfire Wikipedia page to see just how common they are.

Property Taxes

Despite real estate prices in California, property taxes are pretty reasonable. Unlike in high-tax states like New Jersey, California property taxes amount to a meager 1%. Although a low tax rate might sound great, it’s still important to remember that 1% on a $400,000 home amounts to $4,000 in annual taxes.

California Property Taxes

It may be worthwhile to check with an accountant to determine how buying a California home will effect your taxes. It’s also important to note that California’s property tax rate isn’t set in stone. The low rate is a result of Proposition 13, a measure implemented in 1978.

Cost of Living

California is a highly sought after destination, and that makes it extremely expensive to live in. According to HowMuch, residents in California need to make $30.92 per hour to rent a two-bedroom home. That’s not cheap by any means!

California Cost of Living

To put California’s cost of living into perspective, Indiana residents need to make $15.17 per hour to rent a two-bedroom home. Texas residents need to make $16.38 per hour. The only state more expensive to live in than California: Hawaii, $35.20 per hour.

Buying a Home in California

There’s little doubt buying a home in California is a major expense, one that shouldn’t be taken lightly. Not only is it more expensive and prone to natural disasters, but real estate prices are through the roof! With cost of living expenses topping nearly every other state, California isn’t an area to move to on a whim.

Although California is home to plenty of beautiful attractions, natural scenery, and a great night life, it has its drawbacks. Natural disasters tend to wreak havoc year after year, but property taxes remain fairly low. Make sure to take these factors into consideration before you buy a home in California!

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