Here in NJ we’ve had a 2% cap on property tax increases since Chris Christie was governor, and it played out exactly as I’d been warned by a friend in CA; the public worker castes get raises higher than 2%, and other areas suffer from lack of funds. The roads fall apart, foliage grows over stop signs and such, and newcomers don’t want to buy into existing areas - they’d be the suckers paying far higher property taxes than their established neighbors. In CA this wasn’t a problem because a whole new neighborhood would spring up a little further down the road; there is plenty of space. In NJ, this has contributed to a mass of single-family homes for sale with few buyers, while multi-unit hives for childless drones spring up on any remaining buildable land - and immigrants are trafficked here to fill them.
In NJ, there would be opposition to eliminating property tax altogether because the alternative would see even more working Americans’ taxes being funneled towards the dying, bankrupt cities; “home rule” is viewed as sacred here.
I'm not seeing the logic in your argument. In CA there is a lack of space. Housing situation is in crisis mode, as there is a lack of space to build near where the jobs are located. Lack of housing is causing workers to commute more than 100 miles to their jobs. I doubt this is happening in NJ. In the SF Bay Area, there is little space for new building, few empty lots. So they're building high rise towers and creating crowded conditions with massive traffic problems. Neighborhoods are fighting local city councils regarding high rise towers; we don't want them replacing single family homes. We just lost a fight in my neighborhood where we have 1 to 2 story homes, a developer wanted to build a 16 story condo tower about 4 blocks from me, city council got them to reduce to 8 stories for 800 residents. Two other high-rise developments planned on the two surrounding blocks. Lack of space is causing developers to build upwards. Too many newcomers, we wish they'd go back where they came from.