Historic Neighborhoods and their Financial Benefits for Homeowners

By Michelle McCann MARKETING MANAGER

Despite its modern and affluent reputation, Orange County has a surprisingly rich historical legacy, often overlooked and underestimated, particularly in its neighborhoods and its homes. As real estate professionals, understanding this history goes beyond buying and selling properties; it’s about preserving our county’s character. Additionally, investing in a historic home within these neighborhoods may come with financial advantages for your clients such as property tax reductions, historic preservation tax credits, and potential income tax deductions.

Let's explore some of the historic neighborhoods in OC and the benefits they offer to homeowners.

Old Town Orange: Old Town Orange contains the largest nationally registered historic district in California and is known for its well-preserved homes and historic buildings from the early 20th century. This one-square-mile area includes the iconic Plaza Park (or the “Orange Circle” to locals), antique shops, Chapman University, and a diverse mix of businesses and restaurants. The residents of the area try to maintain the original Craftsman, Victorian, and Spanish Colonial Revival architectural styles of their homes.

Historic Downtown Santa Ana: Characterized by early 20th century Spanish Colonial Revival architecture and notable landmarks like the Old Orange County Courthouse, which is a symbol of justice constructed in 1901, Historic Downtown Santa Ana is listed with the National Trust for Historic Preservation and is involved in furthering historic preservation initiatives in Orange County. Homeowners here prioritize conserving architectural heritage and the unique charm of the neighborhood.

Fullerton Historic District: Home to charming historic homes, treelined streets, and landmarks like the Fullerton Train Depot and Fullerton Museum Center. From Craftsman bungalows to Victorian mansions, the architectural diversity of the district reflects Fullerton's long history. Over the last 25 years, 10 of the 16 Districts in Fullerton have been given special designation as Historic Districts Residential Preservation Zones by the city of Fullerton.

San Juan Capistrano Historic District: Famous for its Mission, San Juan Capistrano was established in 1776, and its historic downtown area features adobe buildings, shops, and restaurants. This historic district is also home to a notable Native American history and the Legend of the Swallows. Many of the well-preserved homes in this area are quaint Spanish-style cottages and haciendas.

Anaheim Colony Historic District: This 1.8-square mile area is the city’s first and largest Historic District. Over 1,000 historically significant structures are located here and highlight Anaheim's early agricultural roots with wellpreserved Craftsman and Victorian styles that were common during the late 19th and early 20th centuries. The historic residences in this area have distinctive features such as ornate woodwork, intricate detailing, and various porch designs.

Laguna Beach Historic District: Established in the early 20th century, Laguna Beach is known for its artistic culture and impressive beaches, with historic buildings like the Laguna Art Museum and the Old Laguna Village. The historic homes in this district are characterized by vibrant colors and intricate details. Many of these homeowners are passionate about the historic preservation of their neighborhoods and homes. Laguna Beach is the only city in Orange County that’s been recognized by the National Park Service as a Historic American Landscape (HALS).

Old Town San Clemente: Spanish Colonial Revival Architecture can be found across San Clemente neighborhoods. The city was a master-planned community founded in the 1920s, and every building was required to be built in the Spanish Colonial Revival style, earning the town the nickname of “The Spanish Village by the Sea.” There are about 200 buildings remaining in San Clemente that have been designated as historic. The unique Spanish Colonial style of homes is a source of pride for many residents and there is a collective effort to protect their traditional character.

Make sure your clients know about all the financial incentives that come with owning property in a historical district.

Mills Act Property Tax Abatement: The Mills Act provides property tax relief for owners of historic properties who agree to maintain and preserve their homes. Participating properties are assessed based on their historical significance rather than market value, resulting in potentially lower property taxes.

Learn more: www.preserveorangecounty.org/forproperty-owners

State Historic Rehabilitation Tax Credit (SHRTC): The state Historic Rehabilitation Tax Credit (SHRTC) provides financial incentives, in the form of tax credits, to property owners who undertake qualifying rehabilitation projects on historic structures.

Learn more: www.californiapreservation.org/

Income Tax Deductions: If you make qualified charitable contributions towards the preservation or maintenance of historic properties or landmarks, you may be eligible for income tax deductions. This could include donations to local historical societies or preservation organizations, such as www.preserveorangecounty.org/