[thephyber]

> You only benefit from this if you sell

Home equity is a benefit. You can borrow against it or otherwise use it as an asset on paper.

> if you sell two bad things happen if housing prices are up. First, you take a big hit on capital gains

Wait, what? You're arguing that it's a "bad thing" if you have to pay a percentage of additional profits? Most primary residences aren't subject to capital gains if you hold them for > 2 years, assuming the gain is less than $0.5million (married, co-owning).

[lisper]

I do not object to paying taxes. In fact, I'm very politically active in trying to get taxes raised on rich people like me. But if I want to sell my house and buy the house next door and those two houses cost the same, then the higher those prices are the higher my actual cost of moving is, notwithstanding that I am theoretically trading like for like. That's bad for everyone because it makes me less likely to move, which reduces the liquidity of the housing market, which drives prices up even further.

[vecinu]

Without Prop 13, if you were paying the taxes you actually "should" on the true market value of your house, you would most likely be forced to move out of your current house.

If that happened to enough people, prices would stabilize closer to reality.

[lisper]

Yes, I would totally support the repeal of prop 13. What most people don't realize is that it was a colossal scam by business interests. It was sold as "let granny stay in her house" but it also applies to commercial properties, which don't change hands nearly as often as residences. California has vast tracts of prime real estate that are still being taxed at 1970s assessments.

At the very least prop 13 should have been restricted to owner-occupied principal residences. But that ship sailed long before my time.