Not necessarily. If property taxes were 0%, that would make housing a very desirable investment, pushing prices up out of reach of average people.
On the other hand if property taxes get high enough, they basically act like rent, and the purchase price drops because it's no longer a good investment.
Prices are set by what people are willing to pay. If property tax goes up another part of the mortgage payment (like principle) must go down, otherwise there won't be any sale.
Right, and so existing owners will be driven out of their properties by a rent they cannot afford being imposed on them. Their wealth will be decimated for the reasons you have already stated, and of course new buyers will be purchasing an option to rent rather than own.
What you are proposing is expropriation and state ownership of residential property.
What I meant in my initial comment was progressive as in the more you own, the more you pay. Say, 0% on a primary dwelling, and an extra 5% every new dwelling. The point is to punish hoarders, not to punish homebuyers.
I would recommend using a different and more explicit
phrasing in future. ‘Hoarders’ is a needlessly loaded term though. It sounds like you want to punish individuals using houses as investments.
How would your scheme deal with larger multi-occupancy dwellings? Would they need to be demolished, or would they be appropriated by the state?
> Corporate ownership of SFHs is so small to not matter
People keep saying this and quoting total ownership figures, which is probably what Blackrock and co wanted. Look at actual purchases in the last 2 years instead. Blackrock has bought nearly 50% of all SFH sales in my area in the last year.
It's no coincidence that corporate buying percentages shot up with the prices.
Fed should have hiked rates or started QT a year ago. Even 6 months ago it was pretty obvious the economy was rapidly approaching full employment.
Feds policies led to artificially low interest rates which juices prices. But the prices become sticky when rates rise again, which they are now.
All locales should allow for greater density, and YIMBY attitude needs to prevail over NIMBY. Plenty of people would love to live in small place in a great neighborhood. It's exclusionary and increases wealth disparity to prevent construction in desirable areas. Though denser zoning can actually be lucrative to homeowners (landowners).
Government could also easily curb investor activity in residential by limiting the amount of leverage investors can use for buy and hold rentals. E.g. investors need to put 50% down if it's a buy and hold, and not just a flip. This would clearly kill large amounts of speculation in the SFH market.
For an example of the third paragraph, Oregon passed a law in 2019 that overrides local zoning to legalize duplexes on almost all residential lots and fourplexes and cottage clusters on residential lots in cities with a certain density minimum.
STart a co-op? If you can get 200 people to buy land, and build tiny homesteads and a warehouse for shared goods (tools, ATVS, RVs, etc) you cut back on consumerism, help the environment, AND you take renters out of the rental market. All of a sudden holding onto a rental property doesn't seem so much fun when there's nobody wanting to live there because they can live in our beautiful mountain eco-village for $300/month, and get a real community that's more like a family and supports one another.
So how do you manage zoning issues, including water and energy management? As we saw a good example of in Pittsburgh, how do we maintain the transportation and muni services to these new houses?
(My real point in asking these questions is that housing issues in say, the Bay Area, are different from those in other parts of the country such that it's really hard to make blanket statements about housing. There are some themes, but I posit there are different answers for different locales.)
> So how do you manage zoning issues, including water and energy management?
Single family housing uses more water and energy per capita, generally one will be fine. And overtime one can slowly upgrade infrastructure -- as is done around the world or what happens in American neighborhoods that are upzoned. It really is a red herring of a problem that is brought up.
> As we saw a good example of in Pittsburgh, how do we maintain the transportation and muni services to these new houses?
As long as one is building the new housing nearby jobs you'll be decreasing the average miles traveled. Also it is usually the other way around you need a minimum level of density to make transit more viable and useful.
