> No property owner benefits from land value increasing until after they have sold said property.
People take loans against their assets all the time and having valuable houses makes that a lot easier. Such loans can be used as leverage to buy more property.
Consider a million dollar property in the Bay Area. ( as an example)..property taxes approximate to $12k/year. It costs 9-14k/year per student in the Bay Area depending on the city. With one child, they benefit. With two children, they are still good value for money. But in 12 years, they don’t have kids in public school but they continue paying the property tax. Maybe they will subsidize others’ kids or maybe it will go to infrastructure.
On the other side, someone in an affordable home is getting subsidized by higher value home owners property taxes. If they own the affordable home and the best deal is for the renters. They get the most bang for their rent bucks.
But consider an aging couple with property taxes capped by prop 13, have no more kids in public school and are on a fixed income. What benefit do they gain? There is a more stressed resource pool of law enforcement, $$ for infrastructure improvement, essential services and likely no community benefit like elder day care(in my town, they are converting them to homeless transition centers)...so owning a home is a really bad deal and renting is better.
The only return is the windfall when they sell. But the taxes are also appropriated for the gains. Contrary to popular opinion, home ownership is a burden and not a comfort. It doesnt matter to those who inherit or to those who are in higher income brackets, but those higher income nimbys rightly demand their due and expect a certain quality of life for which they pay dearly.
If productive members of a society are not incentivized to keep producing and supporting the less fortunate, it will be like killing the golden goose instead of just collecting the golden eggs everyday. They will simply leave. Bay Area prosperity bubble will burst sooner than we expect because we treat the productive $$ contributors badly..shaming them for their ‘privilege’. You have to give something back when you are the state with insanely high taxes.
That’s speculative activity. Loans have to be repaid and have interest. It’s not free money.
Home ownership doesn’t always imply assured appreciation of property. Even those with second homes have to pay property taxes and rental income is also taxable.
Many people do NOT take more loans to buy a new home. Home ownership does give a sense of security that the down payment guarantees...it’s 30 years of mortgages and interest. And even the down payment is a result of hard earned or saved $$. People assume that property is a privilege. It’s debt. It’s a higher risk but highly rewarding risk.
Sounds like a benefit to me. Debt is a tool that can bring huge benefits to people who know how to use it.
Most people who own homes have used debt to buy them. Almost everyone who owns more than one home has borrowed against equity in homes they already own to buy the others. The ability to do that is a clear benefit of property ownership.
And a lot of them don’t. Debt is not a strategic play for most householders. Maybe when one is young, but most people seek stability when they have kids and as they get older.
You are generalizing. I know more people who are only single home owners. Perhaps you know wealthier or younger people than I do.
Also: you can’t penalize people for the benefit to get into more debt with more taxes. Then it no longer is a benefit.
People take loans against their assets all the time and having valuable houses makes that a lot easier. Such loans can be used as leverage to buy more property.