As a renter, that would be very painful for me, as my landlord would simply pass the cost of higher property taxes directly to me. (My building isn't subject to rent control.) For buildings subject to rent control, I would expect this would just cause landlords to spend less on improvements to the properties.
If your landlord gets a property tax cut, would they pass on the savings to you? No.
They are leasing you your place at market rate. The market rate is affected by supply / demand of rental units, not landlord costs. The only way they could pass the extra tax onto you is if you are not market rate and there is a law that allows them to do this, or if increasing property taxes on apartment buildings decreases the supply of rental units - an unlikely scenario.
> The only way they could pass the extra tax onto you is if you are not market rate and there is a law that allows them to do this
Not sure what you mean by this: my landlord can raise my rent for whatever reason (or no reason), by any amount they desire.
I can choose whether or not I want to pay it, of course. But I imagine moderate increases to cover at least some (and maybe all?) of the cost of a property tax increase would be swallowed by most renters, given that moving is also a cost, and often a large one.
> If your landlord gets a property tax cut, would they pass on the savings to you? No.
In fact, we have empirical evidence for this. The campaign for Prop. 13 claimed that landlords would pass on the savings, but after it was passed, no corresponding drop in rents was observed.
They are. The caveat here is that in the long run, the attractiveness of owning rental property is affected by the ROI, which is affected, to some extent, by property tax rates. A case could be made that Prop. 13 has expanded the rental supply by increasing the returns to property owners. So even though rents at any given time are determined by supply and demand, over time there should be some tendency for the system to self-correct.
The question, though, is the magnitude of this effect compared to the other forces acting on supply. I think it's small. The value appreciation being enjoyed by rental property owners greatly outweighs the small increase in property taxes they would pay without Prop. 13.
