Provided you can afford to pay the property taxes on the newly valuable house. Otherwise, the second option is off the table. I think that's important because we're not talking about the leisure class here, we're talking about people who work. That means they may not be able to move very far away (they must stay within commuting distance). This is especially true since many people are stuck in their current jobs for various reasons; changing jobs would result in a large pay cut.
I'm not saying they have a right to tell anyone else where to live or not live, but I do sympathize with them.
Yep, the unfortunate reality is that living in a gentrifying area does not guarantee someone a right to continue living there.
Property taxes are a controlling factor on house price inflation to an extent. As property values and taxes increase in an area, residents who can no longer afford that (often times lower-income or fixed-income residents) are forced out. While that sucks for them, this ultimately puts more homes on the market and increases the inventory. Increased inventory means a downward factor on house prices. Probably not enough to prevent them from increasing, but it may slow them nonetheless.
The Bay Area seems to be missing this critical market factor. I'm now seeing townhomes in MV list at 1 or 1.1 and go for 1.3. How depressing is that.
Yeah except now you can't move out of your current house. If you move across the street to a house worth as much as your current house you could end up paying 5x property taxes.
Huh... I didn't really think about it but I wonder if other states (NY was mentioned in the thread above) have a similar rule regarding reassessing the value only under change of ownership or new construction.
Florida amended the "Save our Homes" regulation into the state constitution in 1995. Property is reassessed every year, but growth is capped for the purposes of property taxes. The value can only increase for the lesser of 3% or the CPI. Furthermore, if the assessed value drops below the current taxed value, the capped value is reset to that lower value. Overall, it is a very owner-friendly regulation. The Department of Revenue has a table of all increases since inception. [0] Obviously, transfer of ownership resets the taxed value to the current assessment.
I'm not saying they have a right to tell anyone else where to live or not live, but I do sympathize with them.