Well, you pay tax on your gains on that stock sale. The claim is you shouldn't on houses; it should be a tax-free investment.

You definitely pay taxes on a sold property (capital gains, like stock), assuming your profit is over $250k, like this example. Prop 13 doesn't affect that.

You can't live inside of Apple stock.

Well, I suppose you might be able to make some kind of structure if you had enough physical stock certificates...