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I believe Prop 13 forbids the property-value taxes you are suggesting. This is the main reason why cities are not incentivized to build housing. The rather buil

by electic 10y ago

I believe Prop 13 forbids the property-value taxes you are suggesting. This is the main reason why cities are not incentivized to build housing. The rather build office buildings, malls, etc. There is just more money in it.

adrianratnapala 10y ago
I don't know anything about Californian law except what I read in comment threads on the interweb. But I have heard that Prop 13 capped the absolute amount paid. So a new home or a new resident in an old one could pay a tax proportional to the high land value when the transaction happened. Wouldn't that create an incentive to encourage such transactions?
- electic 10y ago
  The Environment Prior to Proposition 13 Prior to Proposition 13, the property tax rate throughout California averaged a little less than 3% of market value. Additionally, there were no limits on increases for the tax rate or on individual ad valorem charges. (“Ad valorem” refers to taxes based on the assessed value of property. ) Some properties were reassessed 50% to 100% in just one year and their owners’ property tax bills increased accordingly. Proposition 13 Tax Reform Under Proposition 13 tax reform, property tax value was rolled back and frozen at the 1976 assessed value level. Property tax increases on any given property were limited to no more than 2% per year as long as the property was not sold. Once sold, the property was reassessed at 1% of the sale price, and the 2% yearly cap became applicable to future years. This allowed property owners to finally be able to estimate the amount of future property taxes, and determine the maximum amount taxes could increase as long as he or she owned the property.
  - njloof 10y ago
    Exactly. I don't think you can talk about rent control in California without acknowledging property tax control. In the long term, this reduces landlords' expenses, which is a savings they ought to be able to pass on to their renters.
    - asuffield 10y ago
      If they had renters, they could pass those savings on. The article discusses how landlords are keeping units empty because it has become too risky/expensive to rent them. When the law has become so restrictive that people would rather not engage in commerce at all, then it is broken. This isn't helping anybody.

by electic 10y ago

adrianratnapala 10y ago

I don't know anything about Californian law except what I read in comment threads on the interweb. But I have heard that Prop 13 capped the absolute amount paid. So a new home or a new resident in an old one could pay a tax proportional to the high land value when the transaction happened. Wouldn't that create an incentive to encourage such transactions?

electic 10y ago
The Environment Prior to Proposition 13 Prior to Proposition 13, the property tax rate throughout California averaged a little less than 3% of market value. Additionally, there were no limits on increases for the tax rate or on individual ad valorem charges. (“Ad valorem” refers to taxes based on the assessed value of property. ) Some properties were reassessed 50% to 100% in just one year and their owners’ property tax bills increased accordingly. Proposition 13 Tax Reform Under Proposition 13 tax reform, property tax value was rolled back and frozen at the 1976 assessed value level. Property tax increases on any given property were limited to no more than 2% per year as long as the property was not sold. Once sold, the property was reassessed at 1% of the sale price, and the 2% yearly cap became applicable to future years. This allowed property owners to finally be able to estimate the amount of future property taxes, and determine the maximum amount taxes could increase as long as he or she owned the property.
- njloof 10y ago
  Exactly. I don't think you can talk about rent control in California without acknowledging property tax control. In the long term, this reduces landlords' expenses, which is a savings they ought to be able to pass on to their renters.
  - asuffield 10y ago
    If they had renters, they could pass those savings on. The article discusses how landlords are keeping units empty because it has become too risky/expensive to rent them. When the law has become so restrictive that people would rather not engage in commerce at all, then it is broken. This isn't helping anybody.