But the broader point is that the predictions are based on the price history of the last 10 years
This is just extra information. If you don’t think it will be of much additional use beyond the information about the current prices of neighboring properties, then you’d predict that the best predictors will ignore the historical data. To be sure, no one is forcing the predictors to just output the mean property value of neighbors’ properties over the last 10 years.
the understanding that some places are tax bargains
If a whole neighborhood is understood to be a tax bargain, prices will go up, and so will the taxes. (Good predictors will probably focus mostly on these new prices of the neighbors’ properties).
It looks to me like the same mechanism that preserves the incentive to improve your land works to exclude significant changes in land value more generally
If I build a microchip factory on empty land, the value of my property goes up by a much larger factor than the value of neighboring properties. And it is the increase in the value of neighboring properties that (roughly) determines the increase in property tax I pay. So I don’t quite get to keep 100% of the value I created for myself, but I think it’s close to 100%.
Okay that makes sense, but now I’m confused on exactly how the real prices relate to the predictions. I expect the details of that mechanism to be the crux of the issue; exactly how the price updating is done will determine who the winners and losers are relative to the desired outcome.
It still feels like solving that problem well would be tantamount to solving the unimproved value problem, but I’m perfectly happy to be wrong.
This is just extra information. If you don’t think it will be of much additional use beyond the information about the current prices of neighboring properties, then you’d predict that the best predictors will ignore the historical data. To be sure, no one is forcing the predictors to just output the mean property value of neighbors’ properties over the last 10 years.
If a whole neighborhood is understood to be a tax bargain, prices will go up, and so will the taxes. (Good predictors will probably focus mostly on these new prices of the neighbors’ properties).
If I build a microchip factory on empty land, the value of my property goes up by a much larger factor than the value of neighboring properties. And it is the increase in the value of neighboring properties that (roughly) determines the increase in property tax I pay. So I don’t quite get to keep 100% of the value I created for myself, but I think it’s close to 100%.
Okay that makes sense, but now I’m confused on exactly how the real prices relate to the predictions. I expect the details of that mechanism to be the crux of the issue; exactly how the price updating is done will determine who the winners and losers are relative to the desired outcome.
It still feels like solving that problem well would be tantamount to solving the unimproved value problem, but I’m perfectly happy to be wrong.
Well bidders bid for the property, so they’ll “update” the prices by making higher or lower bids. And the predictions just use those bids as data.