Unethical? You bet your ass. Doubly so in the states where your property tax can go up through no action of your own. I believe it is objectively immoral to change what someone owes on something they purchased responsibly and within their budget simply because a bunch of other people around them have different budgets or spend irresponsibly. Of all the plethora of things California gets wrong, prop 13 should be the law of the land.
I would address that problem specifically, and make it illegal. However the better answer is to simply stop suppressing interest rates artificially. These billionaires are only to play this stupid game because banks are willing to give out near zero interest loans. No billionaire is going to do that if they have to pay 9% on it.
That doesn't make it ethical. And more importantly that doesn't change the fact that the unintended second and third order consequences of this change can be very messy. However, unforeseen second and third order consequences are a Hallmark of almost all Democratic legislation, so par for the course.
The problem is that this is the government trying to blame others for what it created. You want to know why the ultra wealthy in this country have reached escape velocity compared to the rest of us? It's because we have a government that believes fiat currency allows them to print as much money as they want for whatever they want. But they are so fantastically unimaginative with this power that they simply feed it directly into the banking system. Gee, small wonder that the biggest beneficiaries of this mechanic have been real estate, equities, and financial assets. Overwhelmingly things that the rich and ultra-rich own disproportionately.
So if you want to fix it, let's lock our currency to something that doesn't allow the government to devalue it massively in a manner that flows almost directly to the richest people in the country. Let's stop artificially suppressing interest rates so that the wealthiest in this country can get nearly unlimited free money to spend in whatever way they see fit. Let's stop protecting gigantic corporations and Banks from the financial Doom of their poor decision making every time it comes home to roost. Too big to fail should be considered hate speech. Anything short of that it's just another trick fuck bit of legislation that will end up having second third order effects worse than the problem it was trying to solve, without addressing the root issue.