[sokoloff]

I don’t think a land value tax is a good idea, because I’ve never heard a satisfactory way to objectively value the land as-if unimproved.

But making you and I pay a different amount of LVT on the same exact piece of land definitely makes it a worse idea in my view.

[eitally]

Afaict, Prop 13 does this in California. Property tax is based on assessed value, and that assessed value isn't just for the improvements, but also the underlying land. So the fact that I pay about $20k/yr in property tax and my back-fence neighbor pays about $3500 (because we purchased in 2016 and they inherited the 1954 home from original owner parents) must indicate that it's not just the improvements that are covered by Prop 13. I had never thought about this before, but at least in California a potential compromise around LVT would be the modify Prop 13 to allow land values to appreciate at market rates while keeping appreciating of improvements capped.

[sokoloff]

There is a market for land plus improvements. What you actually paid in 2016 is presumably the market value of that combination. You probably referred to other similar parcels that had recently sold when contemplating your offer as well.

It’s trying to figure out “what is the land alone under these improvements worth?” that has no market signal to use as a reference (or an extremely weak signal in areas where unimproved lots do sell on the open market).

If you paid $1.5M in 2016, was the land alone $500K, $1M, or $1.25M? If you disagreed with the city’s assessment of just your land, how would you find comps to argue your case?

[eitally]

I think you're missing my specific point that this is a Prop 13 issue.

My land is valued at X and my neighbor's identical rectangular plot is valued at Y, why should that be the case if the land's objective value is identical (which it is, and neither X nor Y are close to current market value Z because Prop 13 caps appreciation at 2%/yr).

No land value or improvements are revalued at market rate until they're sold, obviously, but two things are also true: 1) tax assessors almost never lower assessment values (anywhere), and 2) assessed values are completely detached from reality of the majority of properties in the state of California because of Prop 13.

To answer your question, if I wanted to argue that the assessment of my land is too high, I'd likely not have a case because the assessor could just look at any comps that trades hands in the last few years and those would show assessments far higher than mine. But I absolutely could show that the assessment of others' properties are "too low" relative to my own (or mine to current) just by similarly looking back in time at homes that haven't traded hands in decades, if ever.

[sokoloff]

I originally misread your “Prop 13 does this” to mean the thing in the first paragraph, not the thing in the second paragraph.