Im trying to navigate how my tax base gets reassessed as it relates to this. 

Last Autumn I had the pleasure of finishing up the self designed and custom built-third unit in my 4 plex to rent out as a midterm rental. 

hey Danielle thanks for responding, so i looked up the zoning for the area where the property is and it came back as residential high density which i believe is what i am looking forso is that based off 1 unit/ per a certain amount of space such as a half an acre or less I'm happy to know some one has done the conversion, the illegal apartments seem like lawsuits waiting to happen

I gave an offer to the agent based on my numbers and they asked for proof of funds.  

If you are confident that this developer can complete the project on time and budget, while also delivering a product (condos) that consumers in this market want, then your big two risks are handled.Now specifically on this deal: Based on the little info you mentioned, these are about $1.5mm condos.  

Prop 19 requires one of the sons to make the home their primary residence within a year and file exemption so it is not reassessed from base value + 1M.Question is how long does one of the sons need to make this home their primary residence?

As long as they get paid (which they will) I think they are open to all ideas in and out of the box.The property taxes are set based on a 1950’s rate and if they reset, I’ll have to pay thousands more for every year that I own the home.

For risk management they are only lending to repeat loan customers and not new customers. 

Based on a quick search, I did not see any governmental agencies addressing this particular question.LA county assessor says the child must make the received property his/her primary residence within 1 year, and must file a valid Home Owners property tax exemption. 

Make sure you use net cash flow, so you are accounting for maintenance, repairs, cap ex, vacancy, and property management; based on the numbers you provided your net cash flow is probably $2k per year.