The Mills Act is a federal organization located in the Western part of the United States that specifically helps protect historic homes from being improperly renovated or destroyed. Mainly found in California and Arizona, the Mills Act works with the individual states in lowering the yearly tax base paid on these historic homes. The savings can be significant and I have personally seen the taxes as low as 50% lower than what the normal tax rate should be.
Things to look for when looking for a historic home. First, not all historic homes will be covered by the Mills Act. Just because the home was built in the 1920's or 30's doesn't automatically qualify the home to be covered under the Mills Act. It's worth asking the real estate agent and/or owner if they have ever sent in an application. The biggest problem we see with historic home buyers is that they automatically think it will be covered and that's not the case. If the home is covered the real estate agent will normally promote this heavily as it's a great selling point for the home and a great savings for the buyer.
Next, if you buy a historic home that is covered under Mills Act then it's easy to transfer from one owner to the next. I have personally bought a home that was covered under the Mills Act and the transition was very easy. The Mills Act sent a simple form that I agreed that I would not doing any exterior work to the home without going through the organization first. I had to submit several exterior photos of the home and that was it. The tax base was then transferred to me which really was a huge savings.
For those who buy an older home that is not covered under the Mills Act then there is still hope. The process is not quick and normally takes approximately 9 to 12 months from the application process. We recommend going to the Mills Act organization website and fill out the application. Make sure you represent the home truthfully and send in good photos of the home. It's well worth the effort and can easily save you thousands of dollars each year. If you have any questions feel free to contact me anytime.
San Clemente has many homes that are covered under the Mills Act and do come up for sale from time to time. We recommend working with a local real estate agent that knows these older homes and how the Mills Act works. Below are available historic homes for sale in San Clemente that may be covered under the Mills Act.
San Clemente 402 Pasadena Court
Sea Cliffs - One of San Clemente's Finest Showcase Homes from the 1920's. This One-of-a-kind property has been graced by Greta Garbo, Humphrey Bogart, Gary Cooper & Errol Flynn to name a few. Poised on one of the best settings along the Coast with breathtaking views of the Ocean, White Water, Pier, Beach, Coastline, Dana Point Harbor, Catalina Island & incredible Sunsets from inside the Estate home or from the expansive Historical Gardens that surround a naturalized Water Cascade inspired by ...$4,995,000
San Clemente 233 Avenida La Cuesta
Mills Act tax Benefit, taxes only $6k per year.This exceptionally rare ocean-view estate is nestled on a private double homesite of nearly 1.5 acres, the elegant Hollywood Revival residence has retained its classic period style while incorporating today’s preferred amenities and state-of-the-art systems. Ideally positioned to take advantage of panoramic views that encompass the Pacific Ocean, Dana Point, Saddleback Mountain and city lights, the 6-bedroom, 6-bath estate spans approx. 6,000 s.f...$4,395,000