That's a unique situation. There are national banks that put mortgages in their portfolios. They require the borrowers to open up bank accounts that they will automatically withdraw payments from, and into which the borrower's payroll checks are directly deposited. There's no secondary market, but there are big financial institutions that compete to create opportunities for homebuyers. One is the very restrictive building environment in California.
Cities get a far larger percentage of sales tax revenues than they do of property taxes.
So mayors and city councils love a new Chevrolet dealership, as opposed to a new town-house development, even though they desperately need more housing. California's population is expected to grow by something like 15 to 20 million people in the next 20 years. We need to eliminate that disincentive to development. But the real issue is that we need to create, in certain communities, adequate housing for the population in the least intrusive manner. If you don't do that, over time you will depreciate the environment for everyone.