> Real estate shouldn't be an investment, it shouldn't raise in value,
This is an economical impossibility. Land becoming more valuable is unavoidable, because of the weather, of the people that surround you, the availability of jobs. Rent is high in SF because people are moving to SF and finding high paying jobs. Its not an unrelated effect.
So if there is land more valuable than others, and you taxed away all the value of the land (lets supposed that rent is taxed at 200%, hence all rents drop to 0), you are now going to see something new: people buying land. Now instead of renting, the only operation left is buy and sell. Provided it is cheap at first, because investors would all dump their properties, it will be impossible to get later on. Its an extreme case of rent-control.
This is an economical impossibility. Land becoming more valuable is unavoidable, because of the weather, of the people that surround you, the availability of jobs. Rent is high in SF because people are moving to SF and finding high paying jobs. Its not an unrelated effect.
So if there is land more valuable than others, and you taxed away all the value of the land (lets supposed that rent is taxed at 200%, hence all rents drop to 0), you are now going to see something new: people buying land. Now instead of renting, the only operation left is buy and sell. Provided it is cheap at first, because investors would all dump their properties, it will be impossible to get later on. Its an extreme case of rent-control.