3 ms·

No mention of Prop 13?

• drewg123 10y ago
  I was thinking the same thing. Prop 13 is basically rent control for homeowners/landlords. It dramatically increases friction in the real estate market, and increases NIMBY'ism by giving people huge incentives to avoid doing smart things, like downsizing from a house into a condo due to tax increases. While I lived in Mountain View, I rented a house built in the 50s that was renovated in the early 2000s (but renovated carefully to stay within the prop 13 guidelines). Houses up and down the street were selling for well over $1M, and they were smaller and in rougher shape than our rental. I've recently seen some houses in that neighborhood go for $1.4M So let's assume our rental was worth 1.2M The landlord bought the house in the 70s. I just checked the Santa Clara county property tax for this house: $1760.36 / year on an assessed value of $130K. This is for a house whose market value is roughly 10x that!! So an owner of a house has a roughly 90% discount on his property tax, but only as long has he neither moves, nor improves his house. This causes lots of older folks to remain in houses that are far too large for them. Like older people everywhere, these people oppose "change". They want the neighborhood to look exactly the same as it did 40 to years ago when they moved in. They don't want condo or apartment buildings. The oppose new development of any kind. Meanwhile, they pay next to no property taxes, and the schools are falling apart, and there is no money for improvements that could help with traffic (like more bridges over or tunnels under the Caltrain tracks) or other services. I'm so glad that I'm back to living in a sane market on the East coast, and don't have to deal with this issue anymore.