Downsizing After 55 in Northridge or Mission Hills: Prop 19, Taxes and Your Next Move (2026)

If you are thinking about downsizing after 55, the most important rule to know is Prop 19. It lets California owners 55 and older move the low property tax base from their current home to a new one, anywhere in the state, up to three times. For a Northridge or Mission Hills owner who bought decades ago, that can mean keeping a tax bill thousands of dollars a year lower than a new buyer would pay.

The catch is in the timing and the price of the new home. Get those right and downsizing can free up equity without a big jump in taxes. Here is how it works, with examples using local prices.

When you buy a home in California, it is taxed on its purchase price, and that value can only rise up to 2% a year. Owners who bought long ago often have a taxable value far below today’s price. Normally a move resets it. Prop 19 lets owners 55 and older, and some others such as severely disabled owners, take the old value with them.

Both homes must be your primary residence. You file form BOE-19-B with the Los Angeles County Assessor, and the BOE says to file within three years of buying the replacement. Nearly any home qualifies as the replacement: a condo, a townhome, a single-story house or new construction.

Over the three months ending September 2026, Redfin shows a Northridge median sale price of $1,099,692 and a Mission Hills median of $839,765. Say you sell your Northridge home for $1,100,000 and its current taxable value is $400,000.

Example 1: You buy a $850,000 single-story home in Mission Hills before you sell. That is under 100% of your sale price, so your tax base stays at $400,000. At the basic 1% rate, that is about $4,000 a year instead of about $8,500 on the purchase price, before local bonds and assessments.

Example 2: You sell first and buy a $1,200,000 home eight months later. The limit is 105% of $1,100,000, or $1,155,000. The extra $45,000 is added, so your new base is $445,000. Buy in the second year instead and the limit is $1,210,000, so the full $400,000 base carries over.

Property tax is only half of it. When you sell, the IRS lets you exclude up to $250,000 of gain, or $500,000 if married filing jointly, if you owned and lived in the home for two of the last five years. Your gain is the sale price minus selling costs and your adjusted basis: what you paid plus improvements.

Owners who bought decades ago can have gains above the exclusion, so gather records of big projects like additions, roofs and remodels. A tax professional can also explain how a spouse’s death or a past rental affects your numbers. My capital gains guide goes deeper.

Each path changes your costs differently. A condo may carry HOA dues that offset part of the tax savings. A brand-new home may include special assessments on top of the 1% rate. Ask for the full tax bill estimate on any home you are considering.

And remember the homeowners’ exemption. It cuts $7,000 off your home’s taxable value, about $70 a year, but it does not move automatically. File a new claim on your new home.