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Valid point for sure. But also points out the flaws of property taxes. Teachers and other vital services should come from consumption taxes or other means. Owni

Valid point for sure. But also points out the flaws of property taxes. Teachers and other vital services should come from consumption taxes or other means. Owning a home and having it become more unattractive over time while you have paper gains is crazy. Esp. when paper losses don't go the other way.

dragonwriter 8y ago
> Valid point for sure. But also points out the flaws of property taxes. You fail to make an argument for this. > Teachers and other vital services should come from consumption taxes or other means. In practice on CA, they are. This doesn't make things better than when they were done by property taxes. > Owning a home and having it become more unattractive over time while you have paper gains is crazy. It's a strong incentive for transactions which promote efficiency in the sense of property being in the hands of those who will derive most utility from it. I'm not sure that's crazy, though, especially in the case of non-residential property. > Esp. when paper losses don't go the other way. Without Prop 13, paper gains and losses are symmetric with regard to tax effect; with Prop 13 they become asymmetric, as declines in fair market value are immediately and fully reflected while increases are limited.
- exclusiv 8y ago
  > It's a strong incentive for transactions which promote efficiency in the sense of property being in the hands of those who will derive most utility from it. Strongly disagree here. In CA many people built their houses themselves after the war and don't want to move as an example. You can't argue who would get more utility out of it as a blanket statement. Maybe willing to pay more to live there but not utility. Property taxes almost never go down. They are not symmetric in practice. It's pulling teeth to get a reassessment in your favor. Regarding the core issue of property taxes for vital services - one of the flaws is that areas with lower home values have worse services. Nothing will ever change if property taxes is the primary fundraiser for local services. The other flaw is in practice - budgets don't need to change drastically from year to year but they do. And that's pushed onto homeowners. And what if it needs to change for a valid reason but home values have plummeted? Well that's why they give you problems trying to reassess on a downturn.

dragonwriter 8y ago

> Valid point for sure. But also points out the flaws of property taxes. You fail to make an argument for this. > Teachers and other vital services should come from consumption taxes or other means. In practice on CA, they are. This doesn't make things better than when they were done by property taxes. > Owning a home and having it become more unattractive over time while you have paper gains is crazy. It's a strong incentive for transactions which promote efficiency in the sense of property being in the hands of those who will derive most utility from it. I'm not sure that's crazy, though, especially in the case of non-residential property. > Esp. when paper losses don't go the other way. Without Prop 13, paper gains and losses are symmetric with regard to tax effect; with Prop 13 they become asymmetric, as declines in fair market value are immediately and fully reflected while increases are limited.

exclusiv 8y ago
> It's a strong incentive for transactions which promote efficiency in the sense of property being in the hands of those who will derive most utility from it. Strongly disagree here. In CA many people built their houses themselves after the war and don't want to move as an example. You can't argue who would get more utility out of it as a blanket statement. Maybe willing to pay more to live there but not utility. Property taxes almost never go down. They are not symmetric in practice. It's pulling teeth to get a reassessment in your favor. Regarding the core issue of property taxes for vital services - one of the flaws is that areas with lower home values have worse services. Nothing will ever change if property taxes is the primary fundraiser for local services. The other flaw is in practice - budgets don't need to change drastically from year to year but they do. And that's pushed onto homeowners. And what if it needs to change for a valid reason but home values have plummeted? Well that's why they give you problems trying to reassess on a downturn.