> it's worse to force somebody to sell chunks of the house to the bank
You're selling part of the upside. That's the point of the land value tax. Someone who owns a $1mm house from a $100,000 purchase didn't do $900,000 of productive work. Those gains are rents, in the economic sense, not income. Giving those up--or downsizing, as you suggest--isn't ridiculous and is the point of the land value tax.
That's called inflation. Its not her fault that properties became so expensive. All she wants is a 3 bedroom house. Downsizing is not ridiculous no, but we do generally consider it unfair to push old people out of the houses they lived in their whole lives for ideological reasons.
I would rather we deflate house prices by making it unprofitable to own a home that you don't live in, and have a massive oversupply of new homes.
You're selling part of the upside. That's the point of the land value tax. Someone who owns a $1mm house from a $100,000 purchase didn't do $900,000 of productive work. Those gains are rents, in the economic sense, not income. Giving those up--or downsizing, as you suggest--isn't ridiculous and is the point of the land value tax.