The only way they pay cap gains is if this is a second house
Not the only way. There are several different ways you might have to pay cap gains on a home that isn’t a second home.
But for the article its likely this way they have to pay:
“Both the IRS and FTB provide a capital gains tax break for home sellers who meet certain conditions. The maximum amount of capital gain that can be excluded is $250,000 for single filers or $500,000 for a married couple filing jointly.” source
From OPs article:
“The taxable gain of $1.4 million at 20% would mean those homeowners are facing a $280,000 tax bill. In a state like California with additional tax, the overall payment would be over $450,000.”
They bought the house at $100k, and are walking away after taxes with $1.55m. Boo hoo? They’re saying they get a big tax bill because of inflation, but they’re also able to sell their house for 19x what they bought if for for similar reasons. If they want to sell it to me for $600k and have zero cap gains taxes, I’ll take them up on that offer.