When it comes to the fairy tale of Silicon Valley and the tech startups which has shaped much of the modern world then the state of California you can’t ignore. Today, in this state of tech giants and high-paying employees, it has still managed to make itself prey to the modern housing crisis.

The general idea is that when so many big corporations are here, there must be a proper housing system for those working in that area. But the case is completely different in California, the shortage of housing increases inflates the price of the place, and that, therefore, leads to exorbitant prices of the homes, leading to a crisis.

Due to this massive rise in the rent and cost of the homes, the homeowners might face rampant audits and thus protect themselves with the help of tax audit lawyers from San Diego or from other locations who can look into the case against landowners.

In this blog, we will look into what are the major aspects that led to the housing crisis and how it’s the reason for more tax evasion and fraud, which raises the price.

Why Housing is Such a Problem in California?

The problem with housing is such that a person in today’s age finds it extremely hard even to rent a place in the Golden State. Here, the rents have been institutionalised, and the people who flocked into the States in the ’90s and early 2000s now no longer have a place to live.

It has happened as the number of people who are coming into the states needs to have housing, and for that, the state needs to build around 180,000 houses per year to sustain the population growth, and the state was building less than 80,000 houses per year.

• Houses: From a Place to Live Into a Financial Asset

In California, during the time of the tech boom, many financial companies came to understand that housing would be an important part of the city and thus institutionalized the market to make financial gain from it rather than simply allowing it for single-ownership landowners.

Financial Frauds and How It’s Elevating the Problem

The rise in house prices gives leeway for the institutional owners of the home to commit financial fraud and raise the price of housing in the market, which helps to fill its coffers. For this mishandling, the proprietor owners of the home might face a CDTFA audit, and one must consult with a lawyer to protect themselves from such incidents.

• The Rise of Private Equity Into Housing

The majority of the problem comes from the ownership of the PE firms, which hold multiple real estate assets under their LLP structure, which creates an opaque nature. So when these LLP institutions are doing tax fraud, the house comes under the control of the California government, and it goes into foreclosure, which further increases the crisis.

These steep market actions and incompetent policies are the major reasons for homelessness in the state of Golden State.