> So, it attracts the foreign investors looking for stores of value and encourages NIMBYism.

This doesn't make a lot of sense for two reasons.

The first is that real estate is more the exception than the rule in being subject to property tax to begin with. If foreign investors want a store of value that minimizes "property tax" then they could just buy stocks or bonds etc. Which is why "foreign investors" are a red herring that pundits keep bringing up because it's clickbait or because they want a scapegoat to divert attention from the real problem (which is zoning).

The second is that if you have a place where taxes are lower than other places, that's the place people should be lobbying to build things. Who wants their lower taxes to be on a $1M single family home when they could be on a $100M skyscraper? The main reason this isn't happening is that the effective property tax rate in California is ~0.7% compared to the national average of ~0.9%, which isn't enough different to make a dramatic difference.

The real problem with prop 13 is that it resets on sale transactions or if you build anything, which does provide a major deterrent to construction because then existing property owners neither want to sell to a developer and use the money to buy something else nor build anything on their property themselves since either one would result in a huge tax hike.

>The first is that real estate is more the exception than the rule in being subject to property tax to begin with. If foreign investors want a store of value that minimizes "property tax" then they could just buy stocks or bonds etc

This is exactly the point. If property taxes were higher that flow of capital wouldn't seek store-of-value assets which monopolize valuable land and deprive ordinary people of somewhere to live.

>foreign investors" are a red herring that pundits keep bringing up because it's clickbait or because they want a scapegoat

More like the reverse is ardent defense of the interests of the super wealthy.

They channel their media networks towards scapegoating immigrants instead. Or AI. Or selfish boomers. Or any number of other things which aren't really the problem and most importantly aren't them.

>The second is that if you have a place where taxes are lower than other places, that's the place people should be lobbying to build things

People want to build things because they are useful. People will NIMBY the fuck out of that if it affects the value of their property which it does, disproportionately if property taxes are low.

This is how San Francisco ruined itself - with precisely that attitude of "lower taxes = better"

> If property taxes were higher that flow of capital wouldn't seek store-of-value assets which monopolize valuable land and deprive ordinary people of somewhere to live.

Only they still would, because the higher property taxes would deter new construction until scarcity increases rents to the level that investment gets back over the threshold of profitability. And then investors are still there and what you've really done is cause rents to increase to the level that allows landlords to use it to pay the higher property tax.

> They channel their media networks towards scapegoating immigrants instead. Or AI. Or selfish boomers. Or any number of other things which aren't really the problem and most importantly aren't them.

Are "selfish boomers" not the problem in this case? Who are the ones lobbying for NIMBY zoning rules?

> This is how San Francisco ruined itself - with precisely that attitude of "lower taxes = better"

The big problem with prop 13 isn't that it lowers taxes, it's that it disproportionately raises them if you build anything new on your land or sell it to anyone who wants to.

Yeah, I had dinner with a REIT exec a few years ago, they explicitly called out how they loved how Prop 13 kept the CA property market inflated and NIMBYism strong. Absolutely worth trying to tear it down if you care about housing affordability.

This is an issue in other cities that don’t have prop 13 fwiw, the United States just does not do redevelopment barring a few poor inner neighborhoods getting gentrified by foreclosures in like Houston or Dallas. That’s the natural consequence of individual ownership of houses.

This.