A recent article in the Wall Street Journal should dispel all doubts as to why Prop. 13 is so important to California homeowners.
The article, entitled, “Americans have amassed $35 trillion of wealth in their homes, yet many feel less well off because of it,” presents a sobering view of what is happening in most other states. The extensive piece, written by Veronica Dagher and Anne Tergesen, addresses how home ownership can be a two-edged sword. First, the good news. Home equity, nationally, has increased 80% since 2020 due to rapid increases in home values. This approximately $19 trillion in new wealth adds to the personal balance sheets of Americans lucky enough to own homes. As of 2024, this rate of increase was about twice the rise in financial wealth from other investments including stocks and bonds.
But the bad news is that as home values rise, so can the cost of homeownership, especially in the form of higher property taxes. The WSJ article notes other negatives as well: “Lots of equity can bring down college financial aid for families. And cashing in on the wealth is difficult: High interest rates and prices have held back home sales –…
