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How California Became America’s Housing Market Nightmare

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Re: How California Became America’s Housing Market Nightmare

#101

Earlier quoted context omitted.

> I don't know that it's more "unfair" to the younger generations to not increase property taxes than it would be to the home owners to do so. Why would someone who bought a house for 100k be expected to pay taxes on 2M years later? A lot of these people probably had normal jobs and incomes, they didn't chose for Google/Apple/Facebook to move into town and send the property prices sky high. Yes, they benefit as owner…

Since you're replying to me, I'll say that dichotomy doesn't exist in my mind. I don't think people who earn more should pay a higher percentage of their taxes, mainly for the reasons you list.

> I don't think people who earn more should pay a higher percentage of their taxes, mainly for the reasons you list.

And I assume you mean that extends to gains on housing as well.

Sorry if it seemed I was implying that, I considered putting some comment in noting the fact that whenever these things are being discussed (anything involving behavior of groups....so basically politics in general), it is literally not possible to know who belongs to what group.

Reality is now so complex, I'm starting to wonder if it may be possible that democracy, at least in its current form and with its current constituents in their current form, is literally incapable of handling the world the scientists and indutrialists have built. I think it is perfectly plausible that a benevolent, authoritarian dictatorship is the only thing that has a chance of getting things right. Not that this isn't fixable, necessarily, but I suspect it would require us to spend a considerable amount of time investing the same effort we've put into developing science, technology, industry, supply chains, etc into understanding how individuals and societies work, and modify our institutions and methodologies accordingly (once again, something an authoritarian state doesn't have to bother with).

Everyone seems to think and behave as if we know well enough how they work, but I highly doubt this is the case based on the rapidly increasingly amount of inequality, emotional polarization, and outright bizarre and chaotic behavior that can easily be observed in Western democratic societies. And very few powerful, influential, or even simply intelligent people seem the slightest bit curious(!) about why people are increasingly behaving this way....rather, most of what I hear is Group X is "just wrong" and needs to be educated on how it is, and then the problem will be solved. To that I say, good luck expecting shallow thinking like this to solve multiple interrelated problems in the most complex systems in existence.

It seems to me there is some saying like ~"before man can learn humility, first he must be destroyed", but can't recall the exact words.

Re: How California Became America’s Housing Market Nightmare

#102
post #98

Earlier quoted context omitted.

The younger generation can do the same thing the older generation did and buy a house in a cheaper real estate market. It's funny that people feel entitled to buy a house in the most expensive place on earth. I think a lot of the people who bought houses for 100k in California in the 1970s would not have expected to buy a condo at the same time on 5th Ave in Manhattan (for instance). It's a recent phenomena that youn…

Since values where falsely supported by corrupt mortgages and appraisals then further supported by our government bailout not allowing the market to work as it should, why shouldn't people also expect to not be priced out of their neighborhoods? Shouldn't median income have anything to do with what housing costs should be in any given area? Everywhere in California for example isn't 5th ave or Silicone valley, so you…

Housing prices are dictated by supply and demand. The supply is artificially low due to zoning (this needs to be fixed), the supply was artificially high due to the issues you stated.

None of that has anything to do with taxing home owners. When you buy a house you should be taxed on what you paid for it. The government shouldn't have a back door to come and raise your taxes as high as it wants.

Re: How California Became America’s Housing Market Nightmare

#103
post #52
post #16

Earlier quoted context omitted.

Why should someone who bought a house for $100k get $2m years later?

Why should someone who bought $100k of Apple stock get $2m years later?

Well, you pay tax on your gains on that stock sale. The claim is you shouldn't on houses; it should be a tax-free investment.

Re: How California Became America’s Housing Market Nightmare

#104
post #37

Earlier quoted context omitted.

Repealing Proposition 13, state-level permissive zoning, and using the resulting money to build social housing is the only way I can see out of the crisis. Everything else is just a put-off so the financialized speculation and money laundering can continue apace.

Is social housing really a good focus in extremely valuable real estate areas? Many places in the world are too expensive for most people to live in. Places like Vancouver and Toronto though, have a skyline of cranes building high rises to meet the demand. Social housing in high prices areas is manipulation that doesn't help many people. Letting the demand be met on the high end and shooting for social housing in mor…

Vienna is consistently ranked among the best cities in the world and has a high degree of social housing. And the same is true for places like Singapore and cities across the more social democratic parts of Europe.

If anything, the availability of social housing puts a downward pressure on prices and makes sure that people who perform many of the vital functions of running cities (healthcare workers, teachers, infrastructure maintenance workers) can afford to live there. Leaving something as necessary to survival as housing open to a highly financialized, global capital markets has proven time and time again to be a rolling disaster of homelessness and unaffordability.

Re: How California Became America’s Housing Market Nightmare

#105
post #100
post #78

Earlier quoted context omitted.

A question I have here is are we asking for people to pay taxes on the value of the home because it is at some dollar amount, or are we asking to pay taxes for the cost of services? If my modest home (really it’s modest) doubled in value, I’m not using “double the services”. Why would my property taxes increase? What if it’s an entire neighborhood? Maybe salaries go up for firefighters and teachers... ok? What if the…

Like all progressive taxation, the property tax is not solely a fee for government benefits received by the taxpayer. The property tax is a tool to reduce inequality— especially when it is applied to gains in land value. If we did not have property taxes (or when we protect existing landowners regardless of land rent increases under Proposition 13), then increases in land value from increased population would be enti…

You’ll have to summarize any key points from the book, since I don’t own a copy.

You say that property tax is a tool to reduce inequality, but I’m not 100% sure about that. For example, I don’t even know where my property taxes go. Maybe some small portion goes to the state, but I believe all go directly toward local projects, firefighters, police, and schools.

Further, I’m not sure what I’m supposed to do if my home value doubles just because of natural reasons. The fact that the property has increased in value is an unrealized gain, are we sure it makes sense to increase property taxes? If my income stays the same, and as you say, property taxes is a progressive tax to reduce inequality, what more income do I have to give?

Re: How California Became America’s Housing Market Nightmare

#106

Earlier quoted context omitted.

A more palatable argument is that it would create incentives to keep housing prices stable, rather than expecting a lifetime skyrocketing windfall at everyone else's expense.

The counter argument is: If a widowed elderly woman lives in a 900 sqft home bought in 1963, how is it her fault that the world went crazy and values it at $1,200,000+ today? Have you seen a 1963 house? They’re a fire hazard not worth 1.2M.. And yet, you want her owe tax on that crazy value, yet she is stuck with a static retirement income? Where should she go? Idaho? I’m for increasing tax on income earners, but not…

The old lady made $1m in unearned value in her house. She can use a part of that value to pay taxes on the increase, live and die in the house, and her heirs still make free money.

Re: How California Became America’s Housing Market Nightmare

#107

Paris is 55k people per square mile, San Francisco is 17k per square mile. So there is room for growth. I think it's more likely that people will just continue fleeing the state though. It's tech work so there's nothing preventing people from working remotely.

FWIW, Paris is a transportation hub in the middle of the county, San Francisco is surrounded by water or three sides.

Re: How California Became America’s Housing Market Nightmare

#108

Earlier quoted context omitted.

The counter argument is: If a widowed elderly woman lives in a 900 sqft home bought in 1963, how is it her fault that the world went crazy and values it at $1,200,000+ today? Have you seen a 1963 house? They’re a fire hazard not worth 1.2M.. And yet, you want her owe tax on that crazy value, yet she is stuck with a static retirement income? Where should she go? Idaho? I’m for increasing tax on income earners, but not…

The old lady made $1m in unearned value in her house. She can use a part of that value to pay taxes on the increase, live and die in the house, and her heirs still make free money.

It’s also unrealized. Maybe just tax on the sale or transfer.

Honestly the whole situation is a nightmare. I feel like whenever I think of a “solution” I just find problems with it.

Re: How California Became America’s Housing Market Nightmare

#109

Earlier quoted context omitted.

Because they have a house and ~$1.9M in free equity. The younger generation doesn't have that opportunity. If they can't afford the property tax they can downsize easily. It's not easy for young people to afford $2M houses, especially when paying high state income taxes to make up for the lack of sufficient property taxes.

The younger generation can do the same thing the older generation did and buy a house in a cheaper real estate market. It's funny that people feel entitled to buy a house in the most expensive place on earth. I think a lot of the people who bought houses for 100k in California in the 1970s would not have expected to buy a condo at the same time on 5th Ave in Manhattan (for instance). It's a recent phenomena that youn…

I think it's funny that people feel entitled to these property tax breaks. I'm less concerned about individuals feeling left out, and more concerned about the systemic issues lack of home ownership for this generation will cause. We've distorted the market so much through a variety of bad policies, i don't think it is an unreasonable request to start reversing the trend.

Re: How California Became America’s Housing Market Nightmare

#110

Paris is 55k people per square mile, San Francisco is 17k per square mile. So there is room for growth. I think it's more likely that people will just continue fleeing the state though. It's tech work so there's nothing preventing people from working remotely.

FWIW, Paris is a transportation hub in the middle of the county, San Francisco is surrounded by water or three sides.

NYC has a lot of water too, and its density is comparable to Paris.

All these cities have "housing shortages" though, according to newspapers.

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