Oh, so GP was just incorrect in calling this a tax on gains. That explains why repeat buying and selling incurs more tax.

Large sales tax on home purchases is probably a generally bad idea. Looks like Bay Area pricing would incur a 10-12% tax under the UK scheme which seems pretty crazy.

The value is subjective, if you lived in a quaint town and now it’s become a bustling place it may be a nightmare for you , despite the price increases. That is actually a win win situation, though, since you can now move to another quaint town elsewhere while taking a pile of cash with you, with the perhaps important caveat that you do lose your proximity to places and people you may consider more important than the money.

These imaginary scenarios do not align with typical real world experiences. Very few people live near a dump that closes or see their small town unexpectedly boom (and as brabel notes, that’s not necessarily a benefit).

Most people’s home values go up because of 1) increasing housing demand and 2) the collective delusion that home prices can continue to far outpace wage growth indefinitely. Neither of these things necessarily result in an increase in amenities or improved quality of life.

My own home value has gone up something like 70% in the last 10 years. Meanwhile, the amenities near me are essentially unchanged. Same schools. Same number and quality of restaurants and grocery stores. My net worth has jumped a fair bit but my immediate benefit seems pretty much flat.