That's true. You'd slow it down a bit with the limited price increase & lowest-price-in-a-certain-timeframe rule, but you'd need some other remedy to plug that loophole.

Ok, so how about this: if you underdeclare your house value as X, and then sell it for a price higher than X, then you have to adjust your property taxes for, say, 3 years back? Of course there should be some leniency, so if you sell for less than 105% of X you could be forgiven and not owe anything. After all, you can't be expected to estimate your house value to a cent.