6 ms·

At a tax rate of 1.3% the jump in monthly taxes for a house valued at 400k to 1.2M is about $433 to $1300. It's not nothing but it's also backed by a house that

At a tax rate of 1.3% the jump in monthly taxes for a house valued at 400k to 1.2M is about $433 to $1300. It's not nothing but it's also backed by a house that's now worth $800,000 more - allowing them to take a second mortgage or a HELOC. In no way am I dismissing the concerns here. It probably affects some people more than others and we can talk about specific targeted exclusions. Right now, even the proposal to eliminate this for commercial buildings was rejected. Like rent control, this is indiscriminate welfare. Qualified welfare reaches the people who need it the most.

gowld 6y ago
"qualified welfare" doesn't reach people who can't navigate the bureaucracy.
- caturopath 6y ago
  Aiming it at the people who have made lots of money is the worst of all worlds.
  - zepto 6y ago
    Prop 13 benefits everyone who owns property. It is not aimed at people who have made lots of money.
    - caturopath 6y ago
      Only in the sense that food stamps benefit everyone with kids and medicaid benefits everyone with a body. Is that what you mean, you're valuing prop 13 as a potentially-out-of-the-money option / a safetynet? The people who are actually receiving the value of the benefit for prop 13 are those who have made lots of money on their house -- the more money they've made, the more benefit they get.
      - zepto 6y ago
        My point is that just from the outset, property taxes are a tax that transfers wealth from those who own property to those who do not. All property taxes are always a transfer from property owners to everyone else. Prop 13 or no Prop 13 this is true. So then when we’re talking about Prop 13, we are talking about a putative transfer only between property owners - long-standing vs recent. When I say that it’s also not a transfer, what I mean is that anyone who holds property will end up with the same relative gain over time. This of course assumes that prices continue to rise. If they don’t then these schemes to tax people on unrealized gains fail too.
zepto 6y ago
> take a second mortgage or a HELOC Taking a loan against an inflated asset and using it to pay cash, is a good way to risk bankruptcy if prices go down. Not to mention exposing them to leverage if rates rise.
- 8ytecoder 6y ago
  Sure, we could allow tax deferral on appreciation until the property is sold.

gowld 6y ago

"qualified welfare" doesn't reach people who can't navigate the bureaucracy.

caturopath 6y ago
Aiming it at the people who have made lots of money is the worst of all worlds.
- zepto 6y ago
  Prop 13 benefits everyone who owns property. It is not aimed at people who have made lots of money.
  - caturopath 6y ago
    Only in the sense that food stamps benefit everyone with kids and medicaid benefits everyone with a body. Is that what you mean, you're valuing prop 13 as a potentially-out-of-the-money option / a safetynet? The people who are actually receiving the value of the benefit for prop 13 are those who have made lots of money on their house -- the more money they've made, the more benefit they get.
    - zepto 6y ago
      My point is that just from the outset, property taxes are a tax that transfers wealth from those who own property to those who do not. All property taxes are always a transfer from property owners to everyone else. Prop 13 or no Prop 13 this is true. So then when we’re talking about Prop 13, we are talking about a putative transfer only between property owners - long-standing vs recent. When I say that it’s also not a transfer, what I mean is that anyone who holds property will end up with the same relative gain over time. This of course assumes that prices continue to rise. If they don’t then these schemes to tax people on unrealized gains fail too.

zepto 6y ago

> take a second mortgage or a HELOC Taking a loan against an inflated asset and using it to pay cash, is a good way to risk bankruptcy if prices go down. Not to mention exposing them to leverage if rates rise.

8ytecoder 6y ago
Sure, we could allow tax deferral on appreciation until the property is sold.