What it needed is a way for people whose homes had only gone up a small amount from getting budget busting increments. Once your home has doubled in value, there are other financial mechanisms to solve that problem and you can afford to pay the increase.
If you are a retiree who has worked hard the paper value of your home if you were forced to sell is not a real gain.
What do you mean by "is not a real gain"?
Also - a financial instrument based on the value of collateral can easily go south if the value of the collateral falls.
There is no guarantee that home values will remain stable nor that whatever assets you put the loan into will perform adequately too.
Given that retirees typically don’t have the ability to correct for investments gone wrong out of future earnings, your recommendations would be foolhardy for most.
Simply buying a house to live in is fine.
The only reason we are having this discussion is that the people complaining about prop 13 want a mechanism to force older people out of their homes so they can take have them instead.
That's not how a reverse mortgage works: https://en.wikipedia.org/wiki/Reverse_mortgage
> The only reason we are having this discussion is that the people complaining about prop 13 want a mechanism to force older people out of their homes so they can take have them instead.
That's just not true. We want baby boomers to pay their fair share of taxes and not squirrel away their wealth for their heirs at our expense. In addition, because of Prop 13 (and similar programs else where) mean OTHER tax payers are paying a higher rate than they need to in order to cover the short fall.
Also, what about all of the other people lives you’d destroy? I live in Oakland in a neighborhood where most homes are either rented, or owned by families that are neither boomers, nor high income tech employees.
Any honest discussion about this has to admit that these are would be hardest hit and their communities decimated so that beneficiaries of the tech boom can buy them out.
You are clearly very emotional about this topic but it's NOT about "techbros" "stealing" property from "poor" retirees on a fixed income.
It’s clear that you don’t care about the consequences to anyone who owns a home other than the ‘Boomers’ who you want to make pay.
I didn’t say ‘tech bros’. But I did mention tech. I stand by that but I agree that it is narrow - It’s a stand in for anyone who is young and in a position to have high future earnings.
It's clear that you are so emotional about this issue that you can't help but personally attack those who disagree with you. Let's leave it here.
You could have actually answered my point about the people who were adversely affected instead doing that.
Instead you chose the intellectually dishonest route.
Let’s leave it there instead shall we?
A better solution would be offering up a property lien instead of taxes. The govt collects when the property is eventually sold. People get to stay in their home and property taxes remain fair.
1) It doesn't solve the immediate revenue problems of the taxing authority
2) It doesn't provide any more incentive to move than the current situation in California
3) It exposes taxing authorities to risk in a housing market downturn where people may start surrendering their property rather than sell because selling would net them little money, or even cost them money.
It also allows older people to move without 'losing' a prop 13 tax benefit, since they can retain more value of the large house they don't need anymore with a smaller lower maintenance condo.
Without putting more thought into it, I don't know. I don't see how this changes the revenue picture.
> reduces the lost taxes to a far smaller number of units (every corporation and person vs some older people)
That is independent of the tax lien idea.
> It also allows older people to move without 'losing' a prop 13 tax benefit, since they can retain more value of the large house they don't need anymore with a smaller lower maintenance condo.
This I can see. I know Florida had issues with people who wanted to downsize but couldn't afford to because of the tax jump from selling their homesteaded property.
That said, I'm not sure this alone would open up enough inventory to actually reduce prices.
The government gets all of the deferred taxes on the next sale. That’s immensely better than the current scenario where they don’t get any reasonable amount.
And the deferred revenue can be significant. A friend bought a house where the owner was paying $600 per year when the rate for the same home should have been $11,000 per year.
Usually although, you have provide some sort of incentive to people adopt something, and no taxes vs some small amount taxes is attractive to a voting block. And democracy is getting enough voting blocks to get you over the pass rate.
Also since government works over large numbers and is very long term, they can do actuarial calculations to see when revenue would kick in and issue fairly reliable bonds based on it.
I don’t like taxes being used to take away property from people just because you want what they have.
This is just a variant of "the left is just jealous of rich people" argument. That's not an argument and I'm not jealous, I'm actually quite rich by most standards, I just don't think it's earned or justified, especially in a country with a vivid history of genocide.