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The inequality may not be as widespread as it appears to be. On HN earlier this year someone posted a link [1] which allows one to peruse property taxes anywher

by dano 6y ago

The inequality may not be as widespread as it appears to be. On HN earlier this year someone posted a link [1] which allows one to peruse property taxes anywhere in the state. For this reply I picked a location in Daly City [2] to have a look. The black represent the highest property taxes and the green the lowest - there are few green bubbles. Take a look around, I'm sure there are areas like Huntington Beach [3] with absurdly low taxes, but I've not seen the actual analysis that favors the claims made either way. Proposition 19 effectively eliminates the Parent to Child reassessment exemption, but it wasn't done for altruistic purposes. It was done to put more houses on the market for the real estate profession who funded the campaign to pass the proposition. Yes, this will increase property taxes and limit generational wealth transfer in the form of low property taxes, but it won't fix all the problems listed. If you'd like to examine some potential problem areas in California I'd encourage you to google things like "Prevailing Wage Law" and similar. 1. https://www.officialdata.org/ca-property-tax https://www.officialdata.org/ca-property-tax 2. https://www.officialdata.org/ca-property-tax/#37.690761077216465,-122.46281587480873,18 https://www.officialdata.org/ca-property-tax/#37.69076107721... 3. https://www.officialdata.org/ca-property-tax/#33.6595536026813,-118.00000352784994,15 https://www.officialdata.org/ca-property-tax/#33.65955360268...

jedberg 6y ago
That map puts too many values in the "black" category. Check this one out: https://www.officialdata.org/ca-property-tax/#37.26178563229173,-122.02253937721254,18 https://www.officialdata.org/ca-property-tax/#37.26178563229... Notice how there are a few outliers in red, making almost all the rest black. But look at the black ones. It ranges from $3000 to $25,000. And if you look at a row of roughly equal houses, you will see most of them are around $10K, while a few are $20K. ALL of them should be $20K+, if not for prop 13.
- triceratops 6y ago
  I've seen black ones go up to $47k. It's a crazy-broad range. Looking at the distribution of these numbers on a graph would be way more helpful than this type of visualization.
triceratops 6y ago
In addition to jedberg's comment about the "black"-range being far too broad, the problem is that the mere existence of Prop 13 incentivizes landowners to block new development. New landowners who are paying higher taxes compared to their neighbors would prefer even more appreciation to make up for it. Old landowners are happy to block new stuff because a) it's not like their taxes are going up anyway and b) scarcity makes their property values go up. In any rational market, large numbers of SFHs in Palo Alto, Menlo Park or Mountain View would have been built over with apartment buildings already. Prop 19 is a decent start (I wasn't aware of it, so thanks) but it only passed last year so we'll have to wait and see what its effects are. More importantly, rental and commercial property is mostly not inherited so it's not covered. What's "prevailing wage law"?
- jedberg 6y ago
  This is what I wrote about Prop 19 back in October. It was both an expansion and partial repeal of Prop 13. It was supposed to work in tandem with Prop 15 (the other partial repeal of Prop 13): Prop 19 (Allow people 55+ to take their Prop 13 tax breaks to new homes): Yes. You may ask why someone like me, who is strongly against Prop 13, would support a bill that seemingly expands Prop 13. This bill will encourage older people to vacate their large (and mostly empty) single family homes by allowing them to keep their low taxes and move to smaller single family homes or even fancy downtown condos. That alone would be a good thing, as it would free up needed housing for younger families that are growing and have kids. As long as Prop 13 exists, this will actually make things better by making it financially smart to leave your large unused home (which right now it is not). But is also does more than that! There is also a partial repeal of Prop 13 hidden in this bill. It would force a tax reassessment when you inherit a property if you don’t move into it. This would mean a huge boost to local tax funding which goes towards schools, police, fire, etc. and closes a loophole that wealthy people use to help their kids stay rich by giving them rental properties that are only profitable because of their tax breaks. Also this prop is opposed by the Howard Jarvis association, which is usually an automatic yes for me, because Howard Jarvis is always wrong.
  - triceratops 6y ago

by dano 6y ago

jedberg 6y ago

That map puts too many values in the "black" category. Check this one out: https://www.officialdata.org/ca-property-tax/#37.26178563229173,-122.02253937721254,18 https://www.officialdata.org/ca-property-tax/#37.26178563229... Notice how there are a few outliers in red, making almost all the rest black. But look at the black ones. It ranges from $3000 to $25,000. And if you look at a row of roughly equal houses, you will see most of them are around $10K, while a few are $20K. ALL of them should be $20K+, if not for prop 13.

triceratops 6y ago
I've seen black ones go up to $47k. It's a crazy-broad range. Looking at the distribution of these numbers on a graph would be way more helpful than this type of visualization.

triceratops 6y ago

In addition to jedberg's comment about the "black"-range being far too broad, the problem is that the mere existence of Prop 13 incentivizes landowners to block new development. New landowners who are paying higher taxes compared to their neighbors would prefer even more appreciation to make up for it. Old landowners are happy to block new stuff because a) it's not like their taxes are going up anyway and b) scarcity makes their property values go up. In any rational market, large numbers of SFHs in Palo Alto, Menlo Park or Mountain View would have been built over with apartment buildings already. Prop 19 is a decent start (I wasn't aware of it, so thanks) but it only passed last year so we'll have to wait and see what its effects are. More importantly, rental and commercial property is mostly not inherited so it's not covered. What's "prevailing wage law"?

jedberg 6y ago
This is what I wrote about Prop 19 back in October. It was both an expansion and partial repeal of Prop 13. It was supposed to work in tandem with Prop 15 (the other partial repeal of Prop 13): Prop 19 (Allow people 55+ to take their Prop 13 tax breaks to new homes): Yes. You may ask why someone like me, who is strongly against Prop 13, would support a bill that seemingly expands Prop 13. This bill will encourage older people to vacate their large (and mostly empty) single family homes by allowing them to keep their low taxes and move to smaller single family homes or even fancy downtown condos. That alone would be a good thing, as it would free up needed housing for younger families that are growing and have kids. As long as Prop 13 exists, this will actually make things better by making it financially smart to leave your large unused home (which right now it is not). But is also does more than that! There is also a partial repeal of Prop 13 hidden in this bill. It would force a tax reassessment when you inherit a property if you don’t move into it. This would mean a huge boost to local tax funding which goes towards schools, police, fire, etc. and closes a loophole that wealthy people use to help their kids stay rich by giving them rental properties that are only profitable because of their tax breaks. Also this prop is opposed by the Howard Jarvis association, which is usually an automatic yes for me, because Howard Jarvis is always wrong.
- triceratops 6y ago