Many states have senior property tax reduction programs. It doesn't go as far as prop 13, but had similar goals.

Prop 13 isn't for seniors, though, it's for all ages. And the heirs inherit the tax base. A senior-only prop 13 would reset at death, so at least it's limited in duration.

The effects have got to be pretty intense.

‘We need new shit! Let’s raise taxes.’ While not having to pay them yourself.

A common one I've seen is that for the elderly, property taxes are deferred until they die and are then deducted from their estate (including a sale of the house).

IMO this is a much more fair system than just saying "lol no taxes on the elderly."

Most states also rely on sales taxes and various fees, and assign limited property taxes. A Georgist land value tax would have much greater effects than the current tax regimes.

> Prop 13 has completely distorted the housing market; it is, perhaps unintuitively, a co-cause of CA's housing unaffordability issues. (Prop 13 discourages new development, and is an enabler of housing NIMBYism.)

I have heard this assertion with no proof or backing data a lot. There is an assumption but no explanation how kicking long time residents out of their homes due to tax pressure is a benefit to the community, or real estate market prices. Real estate agents and other service companies might benefit from more transactions.

There is also usually no mention that the main problem of Prop 13 is that it applies to commercial and industrial properties, not just individual primary residences. Individuals have a limited impact scoped to their life, but tax implications applied to long term corporations is what has an outsized effect.

The nonexistence of Prop 13 in other states should be pretty clear evidence that there are more options besides Prop 13 or kicking out lifelong residents.

California already has property tax deferment.

Sure, Florida doesn't have prop 13 and experiences 10x the property tax forclosure rate of California. It's not a desirable thing.

Florida also doesn't have swarms of homeless people like CA does.

I find that forcing the elderly out of multimillion dollar homes and into apartments or even smaller homes is infinitely preferable to the human catastrophe plainly obvious on the streets of LA and SF.

> There is an assumption but no explanation how kicking long time residents out of their homes due to tax pressure is a benefit to the community

One benefit of an equal property taxation system would b having workers close to the city centres where they work rather retirees.

Prop 13 is a bit of a nothingburger anyhow when you consider median homeownership period in CA is only like 2 years longer than national average, rather than the myth that seems to be perpetuated of every home being a 40+ year hold paying a couple dollars in property taxes. And when that home is sold the tax assessment of course goes right back to market rate, and boy that is substantial when you have what would be a 450k home outside of Boston go for 2.1m with a 1% tax. 21 thousand a year off a single 50ft wide lot is no slouch in terms of tax revenue.

> And when that home is sold the tax assessment of course goes right back to market rate, and boy that is substantial when you have what would be a 450k home outside of Boston go for 2.1m with a 1% tax. 21 thousand a year off a single 50ft wide lot is no slouch in terms of tax revenue.

The problem is all the tax revenue being lost at the municipality level for decades. National tenure average is ~12 years. Los Angeles is 20 years, SF is 16.5 and SJC is in between. It clearly has a meaningful effect, it's just harder to buy into the market and keep the home over a long period of time.

San Francisco receives over $3,000 per capita in property tax revenue alone. Dallas receives about $1,200 per capita. NYC is less than $1,000, though I gather NYC has their own property tax issues.

And California has an income tax, whereas Texas doesn't.

Prop 13 has it's problems, but I don't think they're as significant as the rhetoric claims. It makes for a great excuse, though. Politicians can blame Prop 13 for why they can't spend as much on services as people demand, and now it's become the common wisdom--but for Prop 13 California could afford to spend much more than it does, and the housing affordability crisis would end, too. It's just wishful thinking.

I remember when Prop 13 was on the ballot. The newspaper reported that if it passed, it would eviscerate the police and fire budgets. It passed, and nothing happened to the budgets.

I don’t think the housing affordability crisis ends and I don’t think that’s the right way to model it. SF has one of, if not the highest, $/sq ft in the US. And prop 13 is suppressing it - estimates indicate that property taxes revenues would double meaning that 2.5k/person would become 5k.

And remember that that 2.5k/person is only for residential properties. commercial properties still fall under prop 13 and that’s about 50-60 of the other tax. So a full repeal would make it closer to 10k/person instead of the current 5k.

I agree the story on rents and home prices would be unclear because ultimately the people might move and just rent out their homes with property taxes baling into the new rental price.

What would they even do with $10k per person? That seems insanely high.

Also seems unlikely. It might depress housing prices and act as a natural counterbalance (but then rents and Col drops too). I think it’s really hard to model.

I don't think housing costs would drop that much, if at all. What matters is the monthly mortgage payment. Property prices drop when property taxes go up, but mortgage payments tends to stay similar.

In one sense that sounds like free money for the state. However, home equity constitutes the largest share of savings for people, and that's more true the lower down the income ladder you go. So you're taking money out of the working- and middle-class. In some circles home equity is considered a poor savings vehicle, but they don't seem to consider that it's the only secured loan most people can access for leveraged investment. It's the only investment available to most people that let's them leverage capital markets the way the very wealthy can.

And FWIW, residential rents also track monthly mortgage payments, so renters aren't likely to see any difference, either. On average renters pay roughly the same amount per month they'd pay as owners, just without building any equity. I suppose they might be slightly better off after accounting for transfer payments (i.e. public services, entitlements, etc), but they'd be even better off if they could become owners rather than renters.

"I don't think housing costs would drop that much, if at all."

That all depends on if people still want to live there, or can afford it. People tend to be sensitive to taxes, especially if they don't see it improving their lives. Businesses can be sensitive to this sort of thing too. And if they leave, people may leave too. California is already at a net negative when looking at joiners vs leavers. It's mostly been lower wage workers, but in recent years middle and high earners have also been leaving. The population is the same as it was 5 years ago.

"Property prices drop when property taxes go up, but mortgage payments tends to stay similar."

That might be roughly true for a person who just purchased and the federal property tax deduction is uncapped. A retiree who is getting a break on taxes is likely to see a big increase. Not to mention if the house is paid off, then there is no mortgage that could offset it.

I’m sure they can find some things to hire McKinsey to do feasibility studies on the feasibility of doing a feasibility study.

> What would they even do with $10k per person?

Flock. We need more Flock.

Prop 13 also applies to commercial real estate.

It's not reset of you inherit, or a bunch of other bullshit exemptions.

We live in a gerontacracy. Every advantage and tax break and handout is given to the elderly and the ladder has fully been pulled up for the new generations.

They patched that with a recentish assembly bill, but they really need to patch the LLC loophole too.