I suspect repealing prop 13 would crater the housing market.
It would increase the expected long term cost of owning. The present value of this expense would come straight out of current selling prices.
It would also add to inventory. I couldn’t retire in my current house if the assessed value was marked to current market even it the 1% tax rate was retained. Property taxes would become very burdensome even while I am still working.
I think you would see a mass exodus of retires from the state.
The combination of lower demand and bigger supply will really push down prices. Older neighborhoods, which have been fairly stable recently, will be the most effected.
Prop 13 is one of the reasons that CA real estate is so high. It won’t be easy to unwind it without catastrophic results.
The real wild card is future inflation. 2% yearly could look really small for everyone if we keep printing money.
