As much as I want to hate Prop 13 for everything, I don't think that's the issue here. People going to the exburbs to buy houses seem to choose large, traditional single family homes and you can only fit so many of those into the developed areas. I don't think exburbs like Pleasanton, Temecula, Santa Clarita, etc exist because people couldn't find affordable housing in SF, SD or LA. They exist because people can't find affordable single-family homes with modern amenities for a reasonable price in those markets.

That said, there is still the problem of rural residents who never wanted to live in the city to begin with. Nature lovers, independent types, and folks with jobs outside the city are still often living in unsafe conditions and providing them with affordable urban housing isn't going to convince them to relocate.

There's one issue: what if the only homes available in exurban areas are large, single family homes? I would love to buy a brand-new modestly-sized single-family house under 1,000 sq ft in an exurb like Tracy or Hollister provided that it's in the high $300K or low $400K range. I believe there are many people who wouldn't mind purchasing a condo or townhouse in an exurb. The problem is I don't see many being built in these areas, although in the downtowns of these places there are older single-family houses that are of modest size. Every now and then I see townhomes in exurbia that start at roughly 1,300 sq ft., but that's it.

Here's something I'm wondering: why are there no suburban or exurban developments that strive to build new versions of Downtown Palo Alto or Downtown Mountain View, with walkable commercial areas, some apartments and condos near these commercial areas, and some modestly-sized houses built a little further away but still within walking distance to the commercial core? Suppose developers built a "New Palo Alto" near Tracy or Hollister, which is within commuting distance from Silicon Valley. I'd buy in a heartbeat.

You can always buy the land and have a house custom built at whatever size you want.

New Almaden predates prop 13 by over a century.

Sure, but prop 13 guarantees its stasis. Why redevelop your single family home given to you from your parents when it would make your tax burden rise to market rate, which is probably enormous by now?

Is this really true?

We really love blaming extremely complex problems on simple political boogeymen. And when you really think about it, that is all by design.