What about the people who own houses? For all their faults, those houses were affordable and many residents owned them. Now they've been forced out by increased property taxes.
Those luxury buildings are going exclusively into poor neighborhoods because they have the cheapest land and least restrictions.
I don't see where I say anything about those, you might be assuming things here. The whole point is to maintain many of those houses affordability and current residents. If done right, property taxes should not increase significantly, and the local government has the levers to ensure that if they make it a priority.
> Those luxury buildings are going exclusively into poor neighborhoods because they have the cheapest land and least restrictions.
That sounds like what the cities should precisely fix. Use zoning and legislation to herd these buildings into more desirable places. Real estate will still come and build. Many cities have done this before, this is very much possible.
If not private, then we get back to the idea of public housing being built. This is much more of a political longshot, but I think it would actually be quite interesting to see public housing at the top of the market. "Affordable housing" approaches are a bandaid on the issue. By the city building the luxury buildings themselves, they can select the exact places they want them instead of just generally herding.
Cities generally want poor neigbourhoods to get developed and upgraded; if a poor neighbourhood becomes a rich neighbourhood, that's a win for the city, no matter if it's populated by the same or different inhabitants. Cities can focus and redirect development in various ways, but they are explicitly redirecting that development to the poor neighbourhoods because they don't want these neighbourhoods to stay poor.
Is property taxes control (similar to rent control) a thing? It seems it would avoid some of the issues of rent control (lack of maintenance for instance), since they actually own and live in the house, so they have an incentive to keep it nice.
That's what California's Prop 13 is. It works as originally intended to prevent people being priced out by rapidly rising property taxes but has other, necessarily linked negative effects. Lots of reading and analysis available by googling California Prop 13.
Those negative effects were not necessarily linked. Prop 13 was written by a lobbyist for commercial landlords, and corporations have always benefited the most from it.
There are other ways to provide relief for rising property taxes. For example, Washington has a property tax deferral program, so seniors don’t have to pay the increased property tax until they or their heirs sell the house; the capital gains that increased the property tax will pay for the deferred property tax.
That's interesting. It seems like it runs the risk of making a long-held house extremely hard (or money-losing) to sell. If a $1M property has $900K in deferred property taxes against it (which would be possible to accrue in a 50+-year timespan). That house would never get sold, because the holding costs are based on 1970's tax rates (maybe with some annual escalator), so I can hold a $1M house for $5K/year and keep adding $20K/yr to the deferred balance or I can give up the house and put $60K in a real estate agent's pocket, $900K in the city's pocket, and $40K in my own pocket. I'm never doing that.
Texas has a limit of I believe a 10% increase in tax assessment per year, so this prevents the worst outcomes but only slows down the rest. If you think of property tax as crudely analogous to rent (from a budget perspective), most families would not be able to endure 10% rising rent every year for an extended period. Yet this future sure seems to be baked into the market here in Austin right now.
As a sibling comment mentions, California Prop 13 is property-tax control, and it did solve the issue where astronomical increases in property taxes ran families out of their homes. But the side effects and unintended consequences are terrible.
It is hard to tell the poison from the cure with these things.
Those luxury buildings are going exclusively into poor neighborhoods because they have the cheapest land and least restrictions.