[refurb]

Yeah, I feel really sorry for the retired person sitting on millions of dollars of equity. Real sob story.

Why not just give the option to defer increases in property taxes?

It makes zero sense to give tax breaks to people who won the housing lottery.

[fortran77]

Well, I don't have the feelings of "envy" that you do. The fact is, there's little he can do with his "millions of dollars of equity" unless he moves far away from family, friends, and social network. It's cruel to force people to move. I'm not envious or cruel, so I support Prop 13.

[refurb]

It’s not envy. Happy that he made a ton of money.

But, yes, there is plenty he can do. Stay in the house and keep paying low property taxes.

Once he dies or sells, then all those accrued property tax increases get paid, with interest.

You know, the same way a lot of governments in Canada and the US do it.

[amunicio]

He doesn't have to move far and away, he can go live to the other side of the San Mateo bridge and pocket at least a million dollars on the house price difference.

And as others have mentioned, there are other mechanisms to defer the tax payment based on the house equity.

The real cruel thing is to lower the bar for the "have" (as in have a house in SV) and higher it for the "have not".

[jelliclesfarm]

I guess at the end of the day those who own property will do what feels good for them.

It’s funny to see non owners seem up of ways property owners could do with their ‘wealth’.

Guess what, they own property in the hot Bay Area market by virtue of..wait for it..being here and working before most of us were born!

So we can sit here on hacker news and think of all that they need to do to make us feel better, but it means nothing, you know. It’s like the French peasants wondering how Louis XIV should redistribute his kingdom to them. There are no victims. They aren’t the villains...they are just old folks who want to continue to live and die in the towns they funded and built and not be bothered by kids who were likely educated in free public schools they helped build.

[dodobirdlord]

> There are no victims.

What a ridiculous take. Besides, the problem of people wanting to remain in their existing homes is trivially solvable by deferring property taxes as liens against the property to be paid on the death of the owner. Average property tax in California is ~1%, so a person could live an entire lifetime without having to pay anything. But of course that was never the real reason anyone supported these absurd initiatives. It was always about rent-seeking.

[jelliclesfarm]

Sorry. It doesn’t work that way. You can’t tax people for living in the properties they own. Property taxes are just another way to ensure that one never owns their homes 100%. Leins? Who in their right minds would agree to this?

When you want someone to part with their money or wealth, you have to give them a reason to do so. ‘We want what you have’ is not a good reason. It becomes a punitive tax and is based on coercion.

I see no valid arguments or offers that would make people agree to higher taxation.

The have-nots want to take more from the haves. This has happened many many times in the past. It comes from lack. Not logic.

[neilparikh]

> You can’t tax people for living in the properties they own.

We have to do this if we want to allocate land properly. Land is an exclusionary good, so one person owning a piece of land means that someone else can't own it.

Imagine a society with no property tax. What prevents one (or a few people) from buying up all the land, holding it indefinitely, and then charging arbitrarily high rent to everyone else? Property tax forces people to sell if they using it inefficiently, and makes sure that few aren't able to take land and exclude everyone else.

[harryh]

Anyone in this situation can easily take out a home equity loan to pay the taxes and come out way ahead. Your assertion that the higher taxes would force them to move is wrong.

[scarface74]

Say you have equity in a non public company, would you be okay if the government taxed your equity forcing you to take out a loan against it?

[neilparikh]

These 2 scenarios aren't equivalent. Land is an exclusionary good; you using it means I can't. Equity is non-exclusionary. Additionally, the city has to provide services to owners of land, which requires money. The government has no such obligation to owners of equity.

[scarface74]

Yes, land is exclusionary but there is plenty of it in the US. People in California just don’t want to live there.

The government also has to fund services to everyone who works there whether or not they own land. Do devices cost more to home owners based on the value of their land?

I thought the purpose of tax was to fund the government. Not to take stuff that other people wanted.....

[harryh]

I thought the purpose of tax was to fund the government. Not to take stuff that other people wanted.....

Property taxes are among the most economically efficient taxes that exist. They are an excellent way to fund the government.

[harryh]

I don't understand why that is a relevant question.

[scarface74]

Because people are always willing to tax other people's wealth.

[harryh]

Property taxes aren't wealth taxes, they're consumption taxes.

This is obvious when you consider the fact that a person who owns a piece of property outright pays the same property tax as someone who owns a similar piece of property but carries a mortgage.