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Hi, welcome to the conversation, I can tell this is the first time you've engaged with this topic, so I'd love to introduce you to the economic dynamics at play

by uoaei 3y ago

Hi, welcome to the conversation, I can tell this is the first time you've engaged with this topic, so I'd love to introduce you to the economic dynamics at play. When property taxes don't rise, people are disincentivized from selling their home because if they buy a new home they must pay property taxes at the new rate, not the grandfathered one. This creates a bottlenecked supply of housing because no one sells. Growth stagnates and then you get these wild fights about who's allowed to build where, how much they're allowed to build, and what kinds of undesirables might move in and "change the community". It's really a clever ploy to use people's conservative instincts to juice the real estate market since scarcity brings about insanely high costs. Now those with Prop 13 homes are even less incentivized to move because their house's worth just keeps rising. They can use that and borrow against it to play financial games and make their money make money. All because they happened to have bought a home before this law passed: entirely luck, nothing to do with merit or skill.

Domenic_S 3y ago
Do you have data to support this claim? It doesn't appear to play out like this in practice. Compare CA vs a state like NJ and home sales seem on par per capita. https://journal.firsttuesday.us/home-sales-volume-and-price-peaks/692/ https://journal.firsttuesday.us/home-sales-volume-and-price-... https://njar-public.stats.10kresearch.com/docs/lmu/x/EntireState?src=map https://njar-public.stats.10kresearch.com/docs/lmu/x/EntireS...
- uoaei 3y ago
  Why do all these sites only consider from 2010 onward? Prop 13 was passed in 1978.
- 2c2c2c 3y ago
  Would assume this is due to the constant inflow of high income tech workers to california
AlbertCory 3y ago
Do a little research. If you move in CA and you're over 55, you can now keep your property tax bill. Previously it was only certain counties that honored that; now it's all of them. https://www.financialplannerla.com/transfer-california-property-tax/ https://www.financialplannerla.com/transfer-california-prope... > All because they happened to have bought a home before this law passed. Again, do some research. Prop 13 passed in 1978, 45 years ago. The number of current homeowners who bought before then is vanishingly small. House prices were escalating before 13 passed, and the jumps in property taxes were in fact a prime reason why it passed. > they can use that and borrow against it to play financial games and make their money make money Do you have any data at all to support that assertion? > This creates a bottlenecked supply of housing there are all kinds of reasons why there's too little building. Grandfathered house values are only one of them. Regulations and high costs are much more important.
- Manuel_D 3y ago
  > Do a little research. If you move in CA and you're over 55, you can now keep your property tax bill. Previously it was only certain counties that honored that; now it's all of them. This is incorrect, there are still county restrictions. Counties must opt-in to the tax transfers, and the purchased home must be of equal or lesser value. 10 of California's 58 counties permit it, most do not because they don't want to miss on tax revenue. > Again, do some research. Prop 13 passed in 1978, 45 years ago. The number of current homeowners who bought before then is vanishingly small. House prices were escalating before 13 passed, and the jumps in property taxes were in fact a prime reason why it passed. This is not relevant at all. The point is that people's effective property tax goes down over time, regardless of whether they bought before or after prop 13 was passed. Someone who bought a house in 1990 is probably paying less than a third of the normal property tax. > there are all kinds of reasons why there's too little building. Grandfathered house values are only one of them. Regulations and high costs are much more important. Great, we should eliminate restrictive regulations and Prop 13!
- frumper 3y ago
  We bought our house 9 years ago. Current homebuyers on our street are paying 2 to 3 times what we are in taxes for similar homes. Add in our extremely low interest rate and we have no plans to sell the home even if we buy another.

by uoaei 3y ago

Domenic_S 3y ago

Do you have data to support this claim? It doesn't appear to play out like this in practice. Compare CA vs a state like NJ and home sales seem on par per capita. https://journal.firsttuesday.us/home-sales-volume-and-price-peaks/692/ https://journal.firsttuesday.us/home-sales-volume-and-price-... https://njar-public.stats.10kresearch.com/docs/lmu/x/EntireState?src=map https://njar-public.stats.10kresearch.com/docs/lmu/x/EntireS...

uoaei 3y ago
Why do all these sites only consider from 2010 onward? Prop 13 was passed in 1978.
2c2c2c 3y ago
Would assume this is due to the constant inflow of high income tech workers to california

AlbertCory 3y ago

Do a little research. If you move in CA and you're over 55, you can now keep your property tax bill. Previously it was only certain counties that honored that; now it's all of them. https://www.financialplannerla.com/transfer-california-property-tax/ https://www.financialplannerla.com/transfer-california-prope... > All because they happened to have bought a home before this law passed. Again, do some research. Prop 13 passed in 1978, 45 years ago. The number of current homeowners who bought before then is vanishingly small. House prices were escalating before 13 passed, and the jumps in property taxes were in fact a prime reason why it passed. > they can use that and borrow against it to play financial games and make their money make money Do you have any data at all to support that assertion? > This creates a bottlenecked supply of housing there are all kinds of reasons why there's too little building. Grandfathered house values are only one of them. Regulations and high costs are much more important.

Manuel_D 3y ago
> Do a little research. If you move in CA and you're over 55, you can now keep your property tax bill. Previously it was only certain counties that honored that; now it's all of them. This is incorrect, there are still county restrictions. Counties must opt-in to the tax transfers, and the purchased home must be of equal or lesser value. 10 of California's 58 counties permit it, most do not because they don't want to miss on tax revenue. > Again, do some research. Prop 13 passed in 1978, 45 years ago. The number of current homeowners who bought before then is vanishingly small. House prices were escalating before 13 passed, and the jumps in property taxes were in fact a prime reason why it passed. This is not relevant at all. The point is that people's effective property tax goes down over time, regardless of whether they bought before or after prop 13 was passed. Someone who bought a house in 1990 is probably paying less than a third of the normal property tax. > there are all kinds of reasons why there's too little building. Grandfathered house values are only one of them. Regulations and high costs are much more important. Great, we should eliminate restrictive regulations and Prop 13!
frumper 3y ago
We bought our house 9 years ago. Current homebuyers on our street are paying 2 to 3 times what we are in taxes for similar homes. Add in our extremely low interest rate and we have no plans to sell the home even if we buy another.