Inherited homes made up almost 1 in 5 property transfers in California last year
The 18% home inheritance figure was double the rate across the rest of the country.
California dreamin’... about my parents’ place.
According to data from real estate insights firm Cotality, cited in a great piece from The Wall Street Journal over the weekend, some 17.5% of home transfers in the state with the largest economy in the US were inherited last year, in a clear sign that getting a foot on the Cali property ladder has become more difficult unless someone you know has clambered their way up first.
Double it and give it to the next person
For some idea on how the Californian real estate landscape has changed, 30 years ago, inherited homes accounted for an 8.7% share of property transfers in the state, with the vast majority (87.7%) coming through resold properties and the rest via new home sales. While the share of passed-down homes has gradually ticked up since then, the figure for 2025 represents a new high in the Golden State... and more than doubles the 8.8% rate seen across the rest of the US.
Besides younger would-be homeowners having to rely on getting their hands on family property in one of America’s most expensive markets, what else is causing the boom in California? For starters, Californians tend to hold on to their homes for longer, with Redfin data out yesterday showing it as the state with the highest average tenures. Last year, homeowners in the US stayed put for just 12 years on average; in California, the rate rocketed to 20 years, leading to a “till death do us part” approach to property, per an LA financial adviser speaking with the WSJ, that leads to more houses being passed to the next generations.
Lengthy tenures in the state make sense for a variety of reasons, not least Proposition 13, an amendment to California’s constitution in 1978 that effectively capped annual increases in property tax to 2%, cultivating a “lock-in effect.” Add in the fact that some heirs can still benefit from this lower tax rate, despite the state tightening rules around this in 2021, as well as the colossal capital gains savings that can come with inheritance, and California’s “keep it in the family” culture begins to make more sense.
