Your view is NARROW - tunnel vision. Of course that's what you see because you are not looking anywhere else. That's not written to insult. It applies to just about everyone in your line of work.
The age of 55 years is an arbitrary number and reflects the idiocy of the California legislature. It punishes entire groups of people without cause. It's just another example of political expediency, kick the can down the road that CA Democrats use to get reelected.
You are correct that property taxes do not lower property values because the homes listed for sale are in a tight market, an artificially reduced market because the tax assessments force potential sellers to think about losing their low assessed values, so they end up renting instead of selling. You don't see this. What you are seeing is an inventory of homes listed by sellers who don't care or who don't have a low tax assessment to begin with, at least not enough to make a difference.
But property taxes do force rents higher. If rental property owners are lucky enough to sell their rentals, the new owners will face a higher assessed value. With rent controls, this necessarily creates a need to reduce rental property sale prices. I witnessed this in Santa Monica in the 80s. In fact, it was so awful back then that many longterm rental property owners were forced into bankruptcy.
As rental property values fall with rent controls (again you will not see this because you're not looking there), county tax assessors can be expected to NOT lower assessed values even though rent control drastically dampens the market of buyers for rentals causing the prices to collapse. This is because assessed values are based on sales in an artificially induced tight market. Formula-wise, this is sheer lunacy but everyday folks as yourself in real estate can't see the forest from the trees and the state sure as hell doesn't want to see you wise up. It's called 'normalcy bias'. You have to stay in your box lest you be deemed a radical. That's not meant to be insulting. If you're doing well, good for you. Just be aware you are living in a state run by crooks, seriously. If I were you, I would be planning an exit and a new line of work or the same line of work in a different state.
In sum, property tax valuation formulas are flawed and biased toward increasing valuations, hence increased tax revenues for the county and state coffers. The rate is irrelevant, the tax assessed value is what causes the trouble.
The state will do NOTHING to cause real estate prices to adjust to true central points away from the skewed distribution caused by flawed property tax policy and rules. Otherwise, there would be a certain loss of tax revenue flowing from county to state. Counties will have support of homeowners who for example bought a modest bungalow twenty years ago for 200k and are now told it has a market value of 600k in say OC or 1.6M in S. San Fran. It's illusory if not deceptive but such homeowners certainly want to hear nothing that would crash the artificial values planted in their heads. It reminds me of drug addiction, the pusher and the addict teamed up to act as if it's all a fun party.
I'll pass on any beach in LA. I lived in Manhattan, Hermosa, Redondo Beaches and stayed for a time in Palos Verdes. Believe me, it's beyond overrated.
I made millions in real estate. Having developed the eye for the next gentrification targets, I took leave from the university to become an owner-builder teaming up with an award winning architect who was my best friend. But my millions should have been multiplied by a much larger factor if it were not for the contrived sequence of events stemming from the repeal of Glass-Steagall to Wall Street sharks (actually a-holes of the highest order) swimming in local mortgage markets, an activity not seen since the Great Depression. And no, I was not counting on a bubble environment nor was I over-leveraged. In fact, I had two prime properties in escrow when the buyer's financing was halted and years later I and others discovered the official inside the FHA that put out the hit on any real property loans. That's right, the FHA which many are unaware control 80% of real estate market financing, put out an order to halt all loans and left people such as me holding the bag. There will be payback because the amount of investment and energy I lost can be laid directly at their feet. We know the names. And all the accomplices, MERS, BofA, Merrill Lynch, we know them, and we know their offshore trusts and their Delaware Trusts that facilitated the heist.
Although I am rich in dollar terms I'm not satisfied with how it came to be. Today I invest in production, not real estate except for high end homes (Urban Contemporary) and working farms. I hire Vets that persuade me they will work hard and want to get rich. As the real estate bubble has returned, I have been cashing out of the few properties held onto since the crash. But my current focus is trained on developing production businesses both tangible and software. Being really good at developing businesses is far more satisfying personally and financially than chasing gold fluctuations or investing in fool's gold like California real estate. I should have grown along this track years ago.
Here are renderings of prime view city homes that my latest and perhaps last high-end urban developments. They are now presold and in production in a modular facility. They will net me millions which I will invest in AI controlled equipment now located in a rural facility inside a shoreline area of the Kitsap peninsula:
If I was going to stay with real estate, I would sell everything as quickly as possible except for prime land and properties. I would then develop robotic assembly lines in modular facilities that crank out an entire quality built home in less than two weeks (exists today) at $75 per sf and have 10 to 20 homes going at once with plans to expand assembly lines to crank out more. Personally I would stay in the high-end market and take the high-end modular homes into expanded production. Here is one high-end modular architect but there are plenty of others.
Modular facilities are getting better and better all the time but they lack robotics like auto assembly lines have. Modular homes are stick-built, sheet rock, copper plumbing with radiant heating as an option. better grade construction, seismic approved, meeting all codes and including high-end finishes as standard.
But I would sell what I have today as fast as possible because the trends in finance and construction all point to a major restructuring. The current cycle has run its course and things will not continue as they have been. Of course, no one could convince me of this in past decades and I was right to ignore warnings in real estate but today is truly different because of how people are waking up to the Fed and the trouble they have caused including the tension that now exists between the Fed and the President. I see the gold standard returning and the public debt being wiped away by a sustained NIRP that will become the new normal. Gold backed Cyber decentralized to the individual is the future that will replace what exists today.
Because of these changes real estate liquidity will ebb and fade only to be mitigated by rising incomes, You will see the 20% to 25% down payment return as a standard. But you will also see new better quality construction come in at lower costs. The valuations will flat line for a sustained period while the new normal takes root. Location-Location-Location is a tautology that is eternal within stable societies so that means hold on to and maybe, just maybe consider accumulating properties in this category. But be careful. Stay out of such areas as Orange County until the culture war is in retreat, then make a move on distressed properties affected by it.
Another rule of thumb related is that in downturns the high-end keeps moving and everyone else gets stuck. That is especially true in California. Move to the high-end and steer clear of everything else. That goes for you too as a broker because the hours in your day are spent on which part of the market is easiest for you to engage. If you're in anything but the high-end, you could see a downturn in business that runs with a downturn in real estate.
All the above means you have a narrow window (~5-10 years) in which to carry on business as usual. My advice is get 'er done and prepare an exit plan asap.
Last week California turned out Rent Control.
This week POTUS is moving into California with environmental crackdowns.
The war is now at the federal level. It's only beginning. Prepare for massive changes ahead by committing to heart what was advised above.