Many buyers draw a line in the sand, and say, that they don't want to look at homes that have Mello Roos tax. But, one should look at the bottom line. What will the payment be? Some times homes without Mello Roos are higher priced per square foot. And, some have HOA fees. The only way to compare apples to apples is to compare the monthly payment.
in the early years of mello-roos many issues were pre-payable even after the bond was issued. if the property ownere wanted to eliminate the fee they could with a single cash payment. many bond holders didn't like that feature as the issues were well paying to the bondholder. pre-payable issues are rare now
in any housing development the developer can elect to pay for the infrastructure (curbs, gutters, sidewalks, etc) or pass the costs on to the buyers of the properties by way of a bond issue. the lifetime cost of the bond issue is always far more than the cost if the developer simply paid the fees. they choose not to because the fees must be paid as cash...and developers are cheap. years back, in a small 10 home cardiff tract where i sold a home the developer could have paid about $3,400 per door and had no mello roos. he instead tagged the owners with a ten year $110 monthly fee. the math is as follows. $3,400 up front or $13,200 over the ten years...you can see why the folks that bought the bonds wanted the non-pre-payable version.
I often get clients that want newer but refuse to pay for Mello-Roos. There answer is difficult, and like most home searches involves trade offs. You may find new and no Mello-Roos further out, closer to rural. Fallbrook, Valley Center and Ramona to name a few.
Best of luck in your search - you are asking great questions!
Kindred Real Estate
CA Dept of Real Estate Broker's License #01303991
Do you need any assistance with your home search? If so, please give me a call!
You now have your definition of Mello-Roos. As you search for properties you will likely want to know the amount of Mello-Roos, if any; and additionally, any other of the roughly 20 Direct/Special Assessments common in CA.
The process of investigation for determining the construction of your tax bill for an individual property, including whether there's any Mello-Roos, is covered below:
"Estimating Property Taxes in CA"
Best of Luck!
Most of my clients are military, so I also work closely with VA Lenders as well. Thank you for your time and I look forward to hearing from you soon!
Keller Williams Realty
CA DRE# 01703306