Most citizens make a rationale choice in purchasing a home. As the late Thomas Sowell said, “an affordable home is a home you can afford.” For much of our history, home ownership was the most important decision that citizens made to accumulate wealth over their lifetime. Paying off one’s mortgage was a lifetime event, allowing citizens to retire in comfort. But today, many citizens are losing the dream of home ownership.

Unlike other taxes, property taxes give citizens freedom of choice in deciding to invest in a home. Citizens can compare the government services offered relative to the property taxes they must pay in different jurisdictions. And citizens can vote with their feet, moving to a jurisdiction that matches their preferences. Since a large share of property taxes are earmarked for education, citizens can compare the quality of schools and the property taxes in different school districts.

But, high rates of inflation distort the rational choices that citizens make in investing in a home. Since 2020, citizens have been hit with a double whammy. Higher interest rates and higher home prices have priced many citizens out of the housing market. Citizens who own a home are often left with the choice of selling their home and downsizing to a home they can afford. But homeowners ask the obvious question, why should I have to sell my home simply because the government has failed to stabilize prices?

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