Legal Question in Real Estate Law in California

Your question is a trifle brief and short on explanatory facts, but I can give you a general answer that may lead you in the right direction.

The short answer is that almost anyone who buys real estate will want some assurance that they're paying all that money to the actual owner. Determining ownership is done, 99% of the time at least, by reference to what the county recorder's records reflect. If your gift deed is unrecorded, how the heck is a buyer to know for sure that you're the owner?

Sure, you can show them your deed, but the first thing the potential buyer will want you to do is record it, so there's a good and complete record of who has held title.

Another issue that might arise is that the buyer will want title insurance that contains as few exceptions and qualifications as possible. A title insurer won't issue a very strong policy if the person selling hasn't shown his ownership by recording his deed.

It doesn't cost much to record a deed, but it pays big dividends in providing a clear record of ownership. Possibly one might avoid property taxes (briefly) by not rocording a deed, but this is foolish; the unpaid taxes become and remain a lien against the property, and sooner or later the property will be sold for delinquent taxes (and penalties and interest).

Finally, I would be remiss if I didn't point out that when someone sells property, they are subject to state and federal capital-gains taxes on the difference between what their "cost basis" is, and the selling price. If and when you sell your gift property, you'll be subject to capital gains tax on the entire selling price (pretty much, anyway).