I think we should be careful with this. Currently, because of the frozen property tax law, many houses worth millions pay very little in property taxes; if they did have to pay taxes on the millions of dollars their property is worth, they would have had to sell their houses ages ago. This would have likely created a downward pressure on the prices; making it unlikely that the home prices would reach the levels they are now.

All of which to say that assessing the property tax on the current market value of all those properties isn't an accurate number; there is no way there are so many people making that much money living in California.

Given the scale the only sane way to unwind it is to grandfather all sales before a certain date. Otherwise you’ll have masses of people forced out of their properties and chaos.

I mean, there are many solutions to this which aren't an immediate hike in property taxes which would cause much market disruption. But its important to acknowledge that the California Housing market is indeed a market distortion on an Epic Scale. There is just no way that everyone can get the prices they're asking for. And this is perhaps the major reason why I won't personally invest in the CA housing market even though I love the state otherwise.