3 ms·

> just because a bunch of other people swoop in and drive up prices around them. Because they are now wealthier, and can convert the wealth of that house into

by eqdw 12y ago

> just because a bunch of other people swoop in and drive up prices around them. Because they are now wealthier, and can convert the wealth of that house into liquid assets (through sale, remortgage, etc), or income-generating assets (by becoming landlords). That's one of the points of property taxes: to encourage people to do productive things with their asset instead of just sitting on it. An equally anecdotal counterpoint: "Why should a real estate speculator who bought a house twenty years ago not be forced to pay increasing amounts of property tax on it as they wait for its value to go up?"

ubernostrum 12y ago
So the argument here is... that people who are wealthier than I am and/or better at playing the finance game than I am should have my property transferred to them through coercive state action, since they can be trusted to use my property "productively" while I can't? Is this really HN I'm on here?
- ScottBurson 12y ago
  Remember, the whole problem here is that your property is now worth more than you paid for it. That "coercive state action" will leave you with a substantial pile of cash, which the income tax laws will even let you keep. Anyway -- you've never heard of a home equity loan? If you really want to hang on to the property, take out a loan, pay the property taxes with part of it, and use the rest to make the payments. Zero cash flow impact. Or, sell a partial interest in the property to a speculator. There are solutions. And as 'raldi points out, Prop. 13 could have been written so the accumulated difference between tax assessed and tax paid would have been collected at the time of sale. That would have addressed the owner's cash flow problem without requiring financing, without cheating localities of taxes they need to provide services -- not least, education -- and (getting back to the point of the article) without disincentivizing residential development vs. commercial.
  - ubernostrum 12y ago
    I'm still not sure I'm on HN. Where is the person explaining that property tax is theft via government literally holding a gun to your head?
    - ScottBurson 12y ago
      I was never that person.
- lmm 12y ago
  There's a very limited supply of SF. We've recently collectively realized that it's worth more than we thought. So yeah, if you want to keep retaining exclusive use of a particular piece of it (you have the coercive state action part backwards - property rights are not a natural right, they only exist through government action), you'd better pay our governmental institutions according to the present market rate, just like you'd pay for radio spectrum or any other limited public resource.

by eqdw 12y ago

ubernostrum 12y ago

So the argument here is... that people who are wealthier than I am and/or better at playing the finance game than I am should have my property transferred to them through coercive state action, since they can be trusted to use my property "productively" while I can't? Is this really HN I'm on here?

ScottBurson 12y ago
Remember, the whole problem here is that your property is now worth more than you paid for it. That "coercive state action" will leave you with a substantial pile of cash, which the income tax laws will even let you keep. Anyway -- you've never heard of a home equity loan? If you really want to hang on to the property, take out a loan, pay the property taxes with part of it, and use the rest to make the payments. Zero cash flow impact. Or, sell a partial interest in the property to a speculator. There are solutions. And as 'raldi points out, Prop. 13 could have been written so the accumulated difference between tax assessed and tax paid would have been collected at the time of sale. That would have addressed the owner's cash flow problem without requiring financing, without cheating localities of taxes they need to provide services -- not least, education -- and (getting back to the point of the article) without disincentivizing residential development vs. commercial.
- ubernostrum 12y ago
  I'm still not sure I'm on HN. Where is the person explaining that property tax is theft via government literally holding a gun to your head?
  - ScottBurson 12y ago
    I was never that person.
lmm 12y ago
There's a very limited supply of SF. We've recently collectively realized that it's worth more than we thought. So yeah, if you want to keep retaining exclusive use of a particular piece of it (you have the coercive state action part backwards - property rights are not a natural right, they only exist through government action), you'd better pay our governmental institutions according to the present market rate, just like you'd pay for radio spectrum or any other limited public resource.