Jelsma adds that the new Medicare tax applies to almost all real estate transactions and covers almost any form of rental income. “It's a lot for clients to digest. There is recognition that California rates went up retroactively at the beginning of the year, and it's possible that the federal capital-gains rate will go up at the beginning of next year, along with the Medicare tax and the potential increase in the state and gift-tax rate and a reduction in the amount of exemptions—it's a lot for people to handle. All the calls and interest happened the day after the election, so it was really compressed down to a two-month time period.”

In addition to CRE professionals trying to close deals before the ball drops in Times Square, on which GlobeSt.com previously reported, REITs are trying to pay dividends before that deadline because the 15% rate on dividends is likely to go away at the beginning of 2013, Jelsma says. “A number of clients are doing charitable giving that they might have put off until next year. Charitable contribution deductions may be reduced next year, so a lot is being pushed from 2013 into 2012 to try to take advantage of the current year's tax rules.”

According to Steve Jaffe, EVP with BH Properties here, the concern with Prop 30, in offline conversations he's had recently, is, “'What does it take to move my operation out of state?' There are people, whether anecdotal or otherwise, trying to figure out the impact of Prop 30 and the positives and negatives of that. The challenge of the state is trying to meet the gap.”

Jaffe adds that the ultimate question is how real estate and the corporate tax structure impacts new companies coming into the state, particularly if the people running these companies are thinking of living here. “Other states will get a look because California is an expensive place to live. Money doesn't go as far in L.A. as in the rest of the country, so if you have the opportunity to work from anywhere, some people will try to figure out how to be in a different state and run their business.”

It will be interesting to see how many people attempt to move out of state and what steps, if any, California will take to monitor that, Jaffe says. But he does believe that a lot of the talk of moving out of state is mere speculation. “I think people will talk about it, and some people may be able to make that jump. But I don't see real estate companies moving out of state and moving their whole operation out of state to flee a tax burden.”

According to the latest UCLA Anderson Forecast, economists say that Prop 30 will have a mild growth impact on the state's economy. ABC.com reports that the state's payroll will increase by 1.4% next year, and real personal income is expected to rise 3.1% by 2014 as jobs are created and unemployment decreases. In fact, the UCLA Anderson School of Management forecasts California's unemployment rate will decrease to 8.4% by 2014, which is above the national average.

Still, the news service reports that Governor Brown will be putting together the next state budget proposal for release in January, and that budget that will contain higher taxes. While the tax increases are not expected to negatively impact California's economy, the Anderson Forecast does predict they will slow down hiring. However, the Forecast points out that California remains on track for economic growth and more jobs, indicating that the state has begun to come out of the woods fiscally.