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Housing in the Bay Area (and California) is going to continue to get worse due to Prop 13. It destroys liquidity in the housing market. Elderly people can’t do

Housing in the Bay Area (and California) is going to continue to get worse due to Prop 13. It destroys liquidity in the housing market. Elderly people can’t downsize since their taxes would rise dramatically, thus the abundance of retired couples in multi-bedroom houses and young families in apartments. People with multiple homes are incentivized to rent and never sell since they are receiving a government subsidy through below market tax rates. Until Prop 13 is dealt with California will continue to be the leader in inequality with a landed gentry extracting more than their share from the state. The density of tech only exacerbates the problem in the Bay Area, but it is a California problem.

justinzollars 8y ago
I'm not familiar with the YIMBY stance on Prop 13, but as an advocacy group that endorses local measures, you could join and promote propositions that would eliminate 13 - and have a real effect as our voter guide is sent to tens of thousands of bay area residents.
- deleted 8y ago
  [deleted]
- zapita 8y ago
  I generally approve of Yimbi, but eliminating prop 13 is not something they have the influence or the scale to accomplish on their own, or even to lead in a credible way - not even close. California is very large, and prop13 is very popular with a majority of the state’s population. It would take a landslide political change at the state level to revert it, and an alliance of diverse political interests unlike anything that exists in California today (to my knowledge).
  - justinzollars 8y ago
    True. But you could say exactly the same thing about any advocacy group. Its a big country. Its a big state.
    - zapita 8y ago
      You’re right of course. I just think reverting prop13 is important enough, and difficult enough, to warrant creating or joining an organization solely dedicated to that one issue. I feel like pro-housing Californians tend to tuck it into a tactical bullet point, instead of appreciating it for the root cause that it is.
scottlegrand2 8y ago
It's not true at all that the elderly cannot downsize. There is a loophole in all of this specifically designed for them: http://www.assessor.saccounty.net/LowerMyTaxes/BaseYearValueTransfers/Pages/default.aspx http://www.assessor.saccounty.net/LowerMyTaxes/BaseYearValue...
sulam 8y ago
Until you have an alternative to people on fixed income being forced to move from the homes they own because they literally were priced out of the neighborhood, I will defend Prop 13 with words, money and actions. You will never convince me or people like me that it’s okay that my family buying a house in the neighborhood should by itself force our neighbors to have their costs go up. Not only do I not want that, you’d find it also wouldn’t lead to very good relationships. Prop 13 was not created in a vacuum, it exists to solve a very real problem. And don’t forget, the young people that mostly don’t feel this problem don’t vote nearly as much as the older people for whom this problem is most keenly evident.
- ummonk 8y ago
  The solution would be to build more housing to keep prices low - somethung which homeowners would support if prop 13 weren’t a thing.
  - sulam 8y ago
    They have plenty of other reasons to support it. The people that don’t support it for the most part are the large scale landlords who are happy with the run up in rents.
    - ummonk 8y ago
      Large scale landlords actually want to invest in more property. E.g. the apartment building I reside in was built only a few years ago by a publicly traded REIT. It is nativist homeowners that oppose new building because it reduces home appreciation and brings traffic and ethnically different people to the neighborhood / city.
- kelp 8y ago
  The solution is to means test property taxes. To keep lower-income residents in their homes, we discount their property tax from the standard rate. If you're wealthy and can afford to pay a market rate property tax, then you pay it.
biztos 8y ago
I agree with you, but I'd also like to point out that property tax per se is a political decision that was made at some point. Lots of places do just fine with no recurring property tax whatsoever. [edit]: Anybody care to explain (or speculate) why this is being downvoted?
sulam 8y ago
By the way, Prop 13 was a response to what was happening as a result of property values dramatically rising. It was an effect, not the cause, so repealing it isn’t likely to reverse the increase in property values.
- briandear 8y ago
  It will increase liquidity though and thus assist in creating a more efficient market.
masonic 8y ago
The lack of indexing of capital gains taxation is a far bigger factor. As it is, a would-be seller faces losing * over a third* of the paper profit above 250K, and the cost basis doesn't reflect inflation. If you're leaving the Bay Area, you're going to a far less expensive property, plus a dozen or so counties accept transfers of Jarvis-Gann protections anyway. But the tax hit is the crippling factor.

justinzollars 8y ago

I'm not familiar with the YIMBY stance on Prop 13, but as an advocacy group that endorses local measures, you could join and promote propositions that would eliminate 13 - and have a real effect as our voter guide is sent to tens of thousands of bay area residents.

deleted 8y ago
[deleted]
zapita 8y ago
I generally approve of Yimbi, but eliminating prop 13 is not something they have the influence or the scale to accomplish on their own, or even to lead in a credible way - not even close. California is very large, and prop13 is very popular with a majority of the state’s population. It would take a landslide political change at the state level to revert it, and an alliance of diverse political interests unlike anything that exists in California today (to my knowledge).
- justinzollars 8y ago
  True. But you could say exactly the same thing about any advocacy group. Its a big country. Its a big state.
  - zapita 8y ago
    You’re right of course. I just think reverting prop13 is important enough, and difficult enough, to warrant creating or joining an organization solely dedicated to that one issue. I feel like pro-housing Californians tend to tuck it into a tactical bullet point, instead of appreciating it for the root cause that it is.

scottlegrand2 8y ago

It's not true at all that the elderly cannot downsize. There is a loophole in all of this specifically designed for them: http://www.assessor.saccounty.net/LowerMyTaxes/BaseYearValueTransfers/Pages/default.aspx http://www.assessor.saccounty.net/LowerMyTaxes/BaseYearValue...

sulam 8y ago

Until you have an alternative to people on fixed income being forced to move from the homes they own because they literally were priced out of the neighborhood, I will defend Prop 13 with words, money and actions. You will never convince me or people like me that it’s okay that my family buying a house in the neighborhood should by itself force our neighbors to have their costs go up. Not only do I not want that, you’d find it also wouldn’t lead to very good relationships. Prop 13 was not created in a vacuum, it exists to solve a very real problem. And don’t forget, the young people that mostly don’t feel this problem don’t vote nearly as much as the older people for whom this problem is most keenly evident.

ummonk 8y ago
The solution would be to build more housing to keep prices low - somethung which homeowners would support if prop 13 weren’t a thing.
- sulam 8y ago
  They have plenty of other reasons to support it. The people that don’t support it for the most part are the large scale landlords who are happy with the run up in rents.
  - ummonk 8y ago
    Large scale landlords actually want to invest in more property. E.g. the apartment building I reside in was built only a few years ago by a publicly traded REIT. It is nativist homeowners that oppose new building because it reduces home appreciation and brings traffic and ethnically different people to the neighborhood / city.
kelp 8y ago
The solution is to means test property taxes. To keep lower-income residents in their homes, we discount their property tax from the standard rate. If you're wealthy and can afford to pay a market rate property tax, then you pay it.

biztos 8y ago

I agree with you, but I'd also like to point out that property tax per se is a political decision that was made at some point. Lots of places do just fine with no recurring property tax whatsoever. [edit]: Anybody care to explain (or speculate) why this is being downvoted?

sulam 8y ago

By the way, Prop 13 was a response to what was happening as a result of property values dramatically rising. It was an effect, not the cause, so repealing it isn’t likely to reverse the increase in property values.

briandear 8y ago
It will increase liquidity though and thus assist in creating a more efficient market.

masonic 8y ago

The lack of indexing of capital gains taxation is a far bigger factor. As it is, a would-be seller faces losing * over a third* of the paper profit above 250K, and the cost basis doesn't reflect inflation. If you're leaving the Bay Area, you're going to a far less expensive property, plus a dozen or so counties accept transfers of Jarvis-Gann protections anyway. But the tax hit is the crippling factor.