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Comment by Spivak | Hacker News Reader

So the solution to unaffordable housing is to make it less affordable? Like so you price boomers out of their homes with taxes. Then what?

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Property taxes are a useful tool against property speculation (which is why China is desperately considering one). Likewise, the fact that property tax is "stepped up" on sale also makes people less willing to sell (because they lose their sweet property tax valuation if they buy something else) and so pushes up the prices on the remaining second houses on the market. Grandma isn't going to move out of her 4 bedroom house because she is paying much less on property taxes than if she downsized to a two bedroom condo in the same area.

Your second point is moot with the passage of Prop 19 transferring property taxes.

https://en.wikipedia.org/wiki/2020_California_Proposition_19

Why would she move into a cheaper place and thus get a higher effective tax rate and pass less advantage on to her heirs?

But the whole conversation about Grandma is stupid anyway. The California Tax Postponment Program allows her to stay in her house, with zero tax pressure, forever. Plenty of states, even high property tax NJ, have something like that and it's just fine.

as you mention China - the property prices are declining there 3rd year in a row. in lower tier cities more than in Tier A, but also there they decline or stopped climbing.

we will have to wait and see how the common prosperity laws that Xi proposed will further change the life of people - and if they actually work, we must start thinking why WE were not able to do that in the first place with our democratic system that is supposed to represent the people.

Tier A cities have been getting cheaper for 3 years?

Tier 1 cities haven't, but Tier 88 cities have been. Actually, since the red families control most of the real estate companies, they often just prevent you from selling (real estate agents won't show your house) rather than risk scoring a "loss in real estate value." So in China it is better to look at sales volume rather than sale prices.

I think that's intentional. I understand that to combat demographic disaster China has been depopulating the villages in favor of megacities. So tier 88 should get cheaper while tier 1 gets crazy.

Tier 88 cities are hardly villages, they are cities with 1 million or more people. And they aren't shrinking, they are growing as well, most of China's growth will happen in these cities, especially since they are much easier to get hukou in than tier one cities. What good is living in Beijing if you can't send your kids to Beijing schools?

China is looking for a long term solution, not quick fiat fixes from above. Despite all the mistakes they make, the Chinese government isn't dumb, they realize some continuous pressure against speculation in the property market will work better in the long term.

Brings it into line with all other states in the country which have more sensibly priced housing market. Its crazy that someone who's owned a house in the bay area for 50 years pays a tiny fraction of the neighbor who bought just now. Its certainly one of the reasons CA housing is expensive. If I knew taxes were capped you can pay more.

I can understand you want to reward people who stay in the area for a long time, the reward is too great IMO.

You’d force a lot of older people like my parents out of their homes. Itll eventually generation out over the next 10-20 years by itself, with the exception of commercial properties like Disney. If you make them pay, there’s a chance they just straight up leave.

Good news! California has a system in place in place that addresses exactly this problem: https://www.sco.ca.gov/ardtax_prop_tax_postponement.html It allows taxes to be deferred and taken out of the estate. Removing Prop 13 would leave this system entirely unaffected.

Your parents, assuming they are old enough to be seniors, will be fine. Your well-founded concern has been heard and handled. You can rest easy, knowing that your parents and other homeowning elders in California will not be forced out of their homes by property taxes they cannot afford.

Then the heirs lose out, they probably won't like that too much, nor will the pending decedents be happy knowing that a big chunk of their estate is going to be seized. I don't see how this is going to really make higher taxes more palatable.

You'll have to pardon me if I have limited sympathy for the ability of the heirs to rich (defined here as multiple millions of USD in value) estates as they clamor to inherit tax rates from before their births. I understand the emotional pain of losing the all-important family home, but I am unwilling to structure public policy around vast tax breaks so that families flush with unearned wealth keep it.

Nobody likes paying taxes. It's literally never a pleasurable or enjoyable experience. Yet it's one that furthers society and allows it to do things like fund schools - a chronic problem in California.

> Nobody likes paying taxes. It's literally never a pleasurable or enjoyable experience.

Not disagreeing with your points, but one major reason that it's "never a pleasurable experience" to pay tax in America is that ideologues deliberately designed the process to be as painful as possible, to give taxation a bad name. Sadly, it's working.

I would defer to no less than a luminary like Thomas Jefferson in my attitudes toward the would-be inheritors of all those million-dollar ranch-style SDUs, who said something along the lines of..

> I set out on this ground, which I suppose to be self evident, "that the earth belongs in usufruct to the living": that the dead have neither powers nor rights over it.

(Though really, even before I knew of Jefferson's attitudes about inherited wealth, I'd read enough to know that divesting children of unearned windfalls isn't necessarily a bad thing. Can't take it with you, ya know.)

Too bad? Generational wealth transfer is the root of many of society's ills.

If parents bought a home in CA in 1980 for $300k, and then did little more than regular upkeep and minor improvements, and then die in 2021, why should their offspring be entitled to a $10M windfall? They've done nothing to earn it, besides being lucky to be born to parents who were lucky enough to be able to buy housing in an area that they were lucky enough to keep living in when that area became popular.

Wow. Thank you for addressing this in such a friendly way. Every time I point it out I can't help but mock the successful owners but really your way of saying it is more effective

If it encourages them to downsize from their family home after their children have moved out, its a better outcome than having lots of older couples living in 5 bed houses mixed in with families in High Density buildings.

...Then these boomers suddenly start to think building more dense, affordable housing in their town makes a ton of sense?

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