Would increasing local property taxes solve housing (un)affordability?
Andrew Wyeth: Christina’s World, 1917. Image in Public Domain
Former SJ D10 Charter Review commissioner Tobin Gilman scrutinizes the City and County's plan to make housing more cost-effective: by raising property owners' taxes (median of $1,250/month in SJ), via a $10–20 million regional bond. Bond funding would then go to counties for “building affordable housing.” But does it really make sense, asks Gilman on Medium, to make housing less affordable for one group in order to subsidize affordable housing for another?
The San Jose City Council, Santa Clara County Board of Supervisors, and the area’s representatives in the state legislature have a solution to the homelessness and housing affordability crisis.
It’s remarkably simple. Their answer is to make housing costs more expensive for those who own or rent houses and apartments.
Phase 1 of the “Affordable Housing Through Higher Costs” (AH-THC, pun intended) strategy began in 2016 when Santa Clara County supervisors convinced voters to approve Measure A, a parcel tax intended to address housing affordability. Phase 2 began in 2020 when the San Jose city council persuaded voters to approve Measure E, a transfer tax applied to the sale of properties over $2 million. (In a sellers market, buyers pay that tax whether they know it or not.)
Needless to say, Phases 1 and 2 of the AC-THC strategy haven’t made housing more affordable for struggling homeowners and renters. Local politicians think the problem is that residents are not paying enough in taxes. Their answer is to raise everyone’s monthly housing payments with higher property taxes. It’s headed our way in Phase 3.
Phase 3 will be manifested in a series of measures slated for the 2024 ballot. They include ACA 1 which changes the Prop 13 tax approval threshold from 66% to 55%, ACA 13 which is designed to make it impossible for voters to restore Prop 13 supermajority tax approval thresholds, and a regional housing parcel tax....
Everyone pays property taxes either through direct payments to the county assessor or as expenses covered through rent payments. Some residents pay a bit less than the $1,250 per month median and others pay a lot more. No matter what you pay, your elected officials don’t think it’s enough.
This article originally appeared in Medium. Read the whole thing here.
Related:
On outmigration, living standards, and (yes) taxes: What's really at stake with ACA 1?
Hotop: How to resolve SJ's Housing Preservation/Development dilemma
Small Property Owner Rips SJ Housing Dept’s Misconceived COPA Program
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