As a California homeowner, chances are good that you’ve heard of Proposition 19 at some point or another.
But what you’ve heard, chances are good, is only half true.
And it’s that half-truth that’s gotten a lot of Californians into a world of trouble.
That’s because, while it’s true that Prop 19 has altered how property taxes are assessed when a home is inherited, it’s also altered how refinancing, title changes, and other restructuring of home ownership are assessed.
And it’s only once the refinance is complete and the loan is locked that the mistake is realized.
So let’s get into what Prop 19 has actually changed, and what it has altered, and what most Californians get wrong about it.

What Prop 19 Actually Changed (In Plain English)
So, prior to Prop 19, changes of ownership of a home from one family member to the next hadn’t had a huge effect on the way that a home was reassessed for property taxes.
However, post-Prop 19, it’s a whole different story.
That’s because, post-Prop 19, reassessment of a home can be triggered by:

Changes in ownership percentages
Improper changes of title
Improper changes of trust
Improper refinancing
Improper refinancing structures
And the problem, of course, is that most Californians assume that “a refinance of a home doesn’t affect the property taxes at all.”
And that’s just not true.

The Refinance Trap Most Homeowners Fall Into
So, let’s look at what’s actually going on here, and what most Californians get wrong about refinancing a home post-Prop 19:
Your home is owned by a trust, an LLC, or a parent
Your child helps refinance the home and get a better rate and some cash out
Your child’s name is put on the deed “just for the refinance”
And nobody bothers to check how the county will view the change of title
And then the refinance happens, and the rate looks great, and nobody bothers to look at how it’s going to be assessed by the county.
Cash flows into the account.
Then 3-12 months later…
📬 Reassessment notice.
Property taxes increase. Forever.
And the homeowner has no clue why.

Why This Happens (And Why It’s Missed)
Counties don’t care about your intent.
They care about:

Legal ownership

Proportional interest

Title after the transaction

If a refinance causes a:

Change in beneficial ownership

Change in proportional interest

Title transfer not qualifying for Prop 19 exclusion…
…it can be a change in ownership, even if no money changes hands.
This is the failure of coordination.
Loan officers are focused on loan approval.
Escrow officers are focused on loan closing.
Title officers are focused on recording the loan.
Nobody’s thinking about the tax impact unless someone forces the issue.

The “Ask Before You Sign” Checklist
Before a refinance occurs, someone should be able to clearly explain:

Does this refinance impact the title?
Does the proportional ownership remain the same?
Is the property owned personally, in a trust, or an LLC?
If a trust, does it qualify for Prop 19 exclusion?
Has anyone looked at this from the assessor’s point of view?
If not, then you are flying blind.

This Isn’t Anti-Refinance — It’s Pro-Planning
Refinance can still make sense.
But the decision should be based on:

Tax impact
Breakeven analysis
Ownership structure
Risk of permanent reassessment…
Instead of:

Does this refinance save $200/month?
Are there any out-of-pocket fees?
Everyone else is doing it…
A bad refinance decision can cost a lot more than the refinance fees.
It can cost tens of thousands of dollars in property taxes paid out throughout the life of the property.

The Bottom Line
Prop 19 did not make refinancing impossible; it made uninformed refinancing expensive.
If you are being talked into a refinancing, a change of title, or a family loan, especially involving trusts, parents, and inheritance, the key is to slow down before you sign, not after the notice arrives.
If you need help figuring out the order of operations: loan, title, trust, and taxes, that’s where the value lies.
Because once the assessor locks in the value, there is no “undo” button.