We often get this question. What is Mello- roos? Is it forever? What does it cover? Why some houses have it and some don't? Is it a percentage?
Let start by explaining what Mello Roos is.
Mello Roos is a special 'bond' used to finance the cost of public improvements and infrastructure in a newer area, like roads, schools, parks, fire stations etc needed to support the new community. A Mello-Roos District is an area where this special property tax on real estate, in addition to the normal property tax, is imposed on those home owners. The tax paid is used to make the payments of principal and interest on the bonds. Talega and Ladera Ranch are very similar when it comes to the mello-roos. Just doing a drive around you'll notice the similarities: newer homes, many recreational facilities, newer streets etc. Mello-roos are separate from your HOA dues to the community and are paid with your property taxes. Usually mello-roos bonds last for about 20 years.
Not all homes within a same area have the same mello-roos. Let's take Talega for example : there's up to 3 different mello-roos bonds in the area and the amount paid by a specific home owner varies within the location and original sales price. In Talega, all the homes pay the basic infrastructure mello-roos bond that was used to finance the street sewers and community areas.
A second mello-roos was created to pay for the Vista del Mar School, so all homes except the ones in the 'Gallery' which are the senior community homes, have to pay this one as well. There's a third one too, that was used to pay for the Calle Saluda and Avenida Talega bridges and connect the newer homes in the community that were and are still being built on that side of the neighborhood. So those homes in that area will have a third mello roos. And within the homes, the mello-roos assessment also varies and it's calculated with the original sales price regardless of how many times the home has been sold after that.
Many agents would refer to mello-roos as a percentage, we have heard many times people referring to Talega as a 1.8% tax rate area. This is completely wrong, because of all the reasons explained before. The tax rate in Talega is the same as in San Clemente, roughly 1%. Then, on top of that, there's the fixed amounts of mello roos. That's how the total property tax for the home is calculated.
We as real estate professionals can tell you what the exact mello-roos bonds are on a specific home, in Talega's case, the older the home, the less the mello-roos. Talega homes are beautiful and Ladera Ranch homes have so many amenities that for many, those mello-roos bonds are worth paying for.
You can also look up the tax information on any property within Orange County on the assessor's website on the link below. After entering a specific address, you can see the property's tax bill and details, which contain the mello-roos fixed assessments.