It's not a tax on the gains, it's tax based on the estimated current market value, which could go up or down.

How are old people with no income supposed to afford capital gains taxes?

And if house prices go down do they get a refund?

Or working class people. For a large fraction of people if their taxes are going up faster than their wages are going up they do not have a reasonable way to get higher wages to pay for the tax.

There is very little controversy over not taxing unrealized gains when it comes to income tax [1]. I'm not sure why doing the same thing for unrealized gains in property value is controversial.

It's not like most of the things property taxes pay for are proportional to the value of the property. The changes each year in costs to provide roads, schools, libraries, police and fire, and utilities to my house and my neighbor's houses generally has little to do with the changes in the market value of our homes. So why should the taxes that pay those things be tied to market value of the house?

More sensible would be to take the costs to provide the services the tax pays for, and divide it among the houses that receive the services, equally or taking into account usage (e.g., the amount for sewer might be proportional to the number of bedrooms). If we want it to be a progressive tax, apportion it according to the relative market values of the properties, but determine the total amount for the neighborhood solely by how much money the tax needs to raise to provide the services used by that neighborhood.

[1] There is controversy over tricks and schemes used to effectively realize them while escaping taxation.

> It's not like most of the things property taxes pay for are proportional to the value of the property

Exactly! The extraordinary taxes on property are a result of unfair distribution of cost of services. A city needs to collect for a budget of $X... so they distribute the costs the best they can.

Mark to market property taxes do go lower when assessments go lower.

You don't get a refund for the intervening years of mania. Oh we're sorry we almost kicked you out of your house because everyone else was paying out the nose for houses because they speculated Amazon would build it's hq there that year so sorry about that. Here's your 50k in taxes back with interest.

In that scenario it sounds like the person "forced out" would have received a huge windfall of cash, and could ostensibly buy their same house back for much less than they sold it for at the height of the mania.

> the person "forced out" would have received a huge windfall of cash, and could ostensibly buy their same house back

Don't assume. That person had to live somewhere, possibly at equally inflated prices. Now add in the the cost of two unnecessary moves.

> and if you sucked it up and paid the state? Maybe you had a sick family member that you were taking care of and the chaos of a move would have been too much to deal with. Sorry, chum. Bad luck of the draw.

What has happened (at least in my locality) is in years of high assessment increases they cut the rates so the increase is buffered. They typically don't set the tax rate until they see how the initial assessments are coming in.

The other program some counties around here do is property tax exclusion for low income seniors.

Prop 13 is a limits how much property tax can increase in a year. So hypothetically without prop 13 it would possible that the value of your house jumps 10x and then you're stuck with paying 10x the amount of property tax that year.

I don't think we need to remove it completely but some adjustments like applicable only to a primary residence and not investment or commercial properties would probably go a long way.

If the value of my home jumped 10x in a year, I would be ecstatic. Are you kidding?

I'm planning on living in my house for a very long time, it's my home, not an investment. I don't want my home value going up 10x unless I'm planning on selling it. In this market, I couldn't replace my house if I sold it anyway.

> it's my home, not an investment

Oh great! I'll take one of those. Maybe two. Where do I sign up?

If the value then drops 10x, you won’t get your property tax refunded. If prices end up going up and down like bitcoin, you’d need to have some protection.

> If the value then drops 10x, you won’t get your property tax refunded.

That's right. And why would it?

But also: your example is imaginary. When was the last time that house values dropped 10x or even 5x? It's counterproductive to make tax policy based on the extreme cases that have never happened.

Why so? You don't see that gain unless you sell, at which point you'll probably buy another house that has also risen 10x.

In a lot of places, if not most, property taxes are based on the assessed "current market value" of your house and audited annually, which can change a lot from year to year. Property taxes are paid annually, not when the house sells. If the house goes up 10x in a year, the property tax also rises which makes it very hard on a fixed income when you're retired, especially when the gov't artificially calculates inflation at a lower rate so they don't have to pay as much in social security benefits to those seniors reducing their purchasing power over time.

Property taxes are supposed to cover your local government's running services - police, fire brigade, trash/sanitation, water and roads.

Properly distributed, they should not be high.

Property taxes are not a slush fund for the government, nor should they be deferrable. They are intended to be running expenses.

And the fact property taxes are often used as a slush fund makes those of us paying attention very sensitive to their increase. With those taxes comes bureaucratic power and control, often leading to more taxes and less of a say over how one lives one's life.

Shouldn't pass on to your heirs either.