Robert Heinlein proposed this idea in several of his novels. My main problem with it, is that if someone had a family property that they didn't want to sell. This system would force them to massively overvalue their property (and thus pay a lot more taxes than they would reasonably owe) if they wanted to keep it in the family.
Well, yeah, but people will build in a comfortable bonus for themselves and a penalty for buyers and then they'll have added incentive to agitate for a lower tax rate, too! Don't forget that the system as it stands already allows condemnation for valuation. Would you prefer the government set that value or the homeowner? I know which one I'd be happier about!