The idea is most people will assess the value of their house at a premium, and tax rates are commensurately lowered. If the best way a rich person could mess with me is to buy my house for twice what it's worth, I would personally laugh all the way to the bank.
There is a bit of regressiveness to this though, as it will be worth it for people with a lot of property to pay someone to regularly update their assessed value to keep pace with the market, while those with less property will probably just set a large premium and update infrequently. This is a problem with pretty much any tax though; the more you are being taxed, the more you can afford to pay to figure out how not to be taxed.
I posted potential problems in my sibling comment earlier, but as far as this goes, the ugliest thing would be e.g. an 80 year old who forgot to update their assessed value in a hot market being kicked out by someone who bought their property to flip it for 2x the assessed value.
In theory, they are a tax-cheat who got what they deserved...
I suppose the free-market solution would be services that assess your home for a fee; they could provide insurance against undervaluation as well to incentivize them to do the right thing. This monetarily works out to be roughly equivalent to the government paying private companies to fairly assess people's home-values, but with financial incentives for doing it properly.
There is a bit of regressiveness to this though, as it will be worth it for people with a lot of property to pay someone to regularly update their assessed value to keep pace with the market, while those with less property will probably just set a large premium and update infrequently. This is a problem with pretty much any tax though; the more you are being taxed, the more you can afford to pay to figure out how not to be taxed.
I posted potential problems in my sibling comment earlier, but as far as this goes, the ugliest thing would be e.g. an 80 year old who forgot to update their assessed value in a hot market being kicked out by someone who bought their property to flip it for 2x the assessed value.
In theory, they are a tax-cheat who got what they deserved...
I suppose the free-market solution would be services that assess your home for a fee; they could provide insurance against undervaluation as well to incentivize them to do the right thing. This monetarily works out to be roughly equivalent to the government paying private companies to fairly assess people's home-values, but with financial incentives for doing it properly.