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MIT 11.350: Sustainable Real Estate

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Re: MIT 11.350: Sustainable Real Estate

#61

Post by mizzao »

amluto wrote: post #50
JumpCrisscross wrote: post #27

Earlier quoted context omitted.

> why can't we just charge a federal property tax 3-4x local property taxes for individuals who own >1 property Trivially worked around. Use an LLC. Have it bought in a relative’s name. Have it bought in a rando’s name with a bulletproof lease with a $1 rent-to-own option at its termination. Essentially, the property registry system becomes a farce. (You see this, for example, in India.) Simpler: a straight wealth ta…

This could be improved by changing the criterion: an actual human needs to be registered as living in that house and live there. LLCs, trusts, and other entities don’t count. If people want to split their time, fine, let them have as many houses as they want, declare what fraction of their time is spent in each one, and get that fractional credit for each one. Worried about a couple taking the credit for each person…

The more complicated laws are written to try and cover more edge conditions, the more loopholes they create.

Re: MIT 11.350: Sustainable Real Estate

#62

Post by stonethrowaway »

latenightcoding wrote: post #4
jmyeet wrote: post #2

We need to stop treating real restate--especially residential real estate--as a mechanism for creating wealth. there are enough homeowners that they vote for politicians and policies that will increase the value of their "investments". All this does is simply steal money from the next generation. Our entire economic system is designed to transfer wealth from the young and poor and the old and wealthy. There is a dist…

The prime minister of Canada literally said housing can't come down because it's the retirement plan of a lot of boomers.

Anyone who wants to see the current state of how the alt-mainstream thinking on this subject is shifting is welcome to indulge in the inventories over at [r/Canada, r/CanadaHousing, r/CanadaHousing2, r/TorontoRealEstate]. Anything that is not related to immigration or housing is essentially treated as a distraction. There is a simmering build up of disillusionment, anti-immigration and perhaps xenophobia that was usually not tolerated/allowed (hence the more spicy off-shoot CanadaHousing2), but the emotions have more or less found a stable equilibrium, and it’s not pretty.

I don’t have answers here, I can just observe the situation and blink.

Re: MIT 11.350: Sustainable Real Estate

#63

Post by onlyrealcuzzo »

majormajor wrote: post #59
onlyrealcuzzo wrote: post #53

Earlier quoted context omitted.

This isn't a distribution problem. We don't have enough pie (houses). We need more houses. Not a campaign to distribute a massive shortage slightly more evenly.

What's the reason that, with office occupancies down in so many places, there isn't a big push for conversion of commercial zoning to residential multi-family? Incentive programs to reward converting vacant spaces? Penalty taxes for holding vacant office space instead of selling it to someone who will figure out something to do with it?

Because most skyscrapers can't be converted to housing efficiently.

It would cost more to convert them then you could sell the units for.

The people who own those buildings are desperate to fill them. They'd convert if it made sense.

They aren't part of some evil cabal to have commercial buildings sit empty to push up residential property prices.

Re: MIT 11.350: Sustainable Real Estate

#64

Post by leehuffman »

hahahacorn wrote: post #5

Genuine Question, why can't we just charge a federal property tax 3-4x local property taxes for individuals who own >1 property (which would likely be distributed back to the locality, specifics not important), apply the same rules we do for pass-through taxation to mitigate loopholes, and automatically charge this elevated rate for properties owned by non-natural persons? I think this would just price in the externa…

> Genuine Question, why can't we just charge a federal property tax 3-4x local property taxes for individuals who own >1 property (which would likely be distributed back to the locality, specifics not important)

I am that person.

I own two duplexes in addition to my primary residence, for a total of four residential rental units – all 2/1s made up of ~750 sq ft each. Those additional properties that I own provide housing to 6 humans who can't purchase, or just prefer not to.

What you're proposing would result in one of two moves from my end:

1. I sell both properties and let someone/some entity (who doesn't work and/or manage the properties themselves, have any relationship with the tenants, will push rents to market prices immediately, etc etc) deal with it.

2. I scrape the lots, stand up single family homes, take my gains and walk inside ~18 months. That puts the 6 humans mentioned above out into a (very tight, Either way, it's a high level hit to individuals, the market, whatever. It doesn't result in any gains or economic corrections to the RE market.

> (which would likely be distributed back to the locality, specifics not important)

That's already happening in my scenario. I own & operate a General Contractor LLC entity that issues invoices to me, the property owner. The local city, county, and state are paid B&O, sales, etc taxes on those GC LLC invoices out of my personal pocket. Separately, my personal rental income is taxed appropriately at the federal level.

> I think this would just price in the externalities of corporate versus natural person living in a property for a locality.

You know what else can be priced in? Or wildly swing a market into affordability, normality, etc? Letting people build things. My lots are massive, but they consist of sheds and lawns instead of multiplying my units and housing more people.

It's impossible in my local market, and that's why it's carrying the <= 1% residential vacancy rate it has for 15+ years, and why rents are increasing at wild rates that no industry/job market inside 80 miles can support. Economics 101 says supply vs demand etc etc. Easy layups for anyone with half a brain. We don't have to modify anything outside of city/county zoning & the ability to infill everywhere.

Re: MIT 11.350: Sustainable Real Estate

#65

Post by rcpt »

hahahacorn wrote: post #5

Genuine Question, why can't we just charge a federal property tax 3-4x local property taxes for individuals who own >1 property (which would likely be distributed back to the locality, specifics not important), apply the same rules we do for pass-through taxation to mitigate loopholes, and automatically charge this elevated rate for properties owned by non-natural persons? I think this would just price in the externa…

Federal government can't levy any property tax unless we amend the constitution.

Re: MIT 11.350: Sustainable Real Estate

#66

Post by leehuffman »

onlyrealcuzzo wrote: post #63
majormajor wrote: post #59

Earlier quoted context omitted.

What's the reason that, with office occupancies down in so many places, there isn't a big push for conversion of commercial zoning to residential multi-family? Incentive programs to reward converting vacant spaces? Penalty taxes for holding vacant office space instead of selling it to someone who will figure out something to do with it?

Because most skyscrapers can't be converted to housing efficiently. It would cost more to convert them then you could sell the units for. The people who own those buildings are desperate to fill them. They'd convert if it made sense. They aren't part of some evil cabal to have commercial buildings sit empty to push up residential property prices.

Why is everyone (ok, fine, mostly economics & tech people) convinced this is such a wildly viable slam dunk of an idea?

Have y'all ever opened up a wall before and seen the electrical, plumbing, etc mechanical bits that make up a home? Any idea of what it'd cost to chop up that office space and feed every individual piece the necessary bits?

It's outrageous that we're even talking about this idea still. It'd require wildddddd tax advantages & federal spends in order to execute on it in any sense of the overarching idea.

Re: MIT 11.350: Sustainable Real Estate

#67

Post by Aunche »

hahahacorn wrote: post #5

Genuine Question, why can't we just charge a federal property tax 3-4x local property taxes for individuals who own >1 property (which would likely be distributed back to the locality, specifics not important), apply the same rules we do for pass-through taxation to mitigate loopholes, and automatically charge this elevated rate for properties owned by non-natural persons? I think this would just price in the externa…

Not everyone wants to be a homeowner or will have the means to purchase one even with additional incentives, and the increased property taxes are going to be passed to renters. Also, if you intend on purchasing a place to live, you're unlikely to purchase a place that requires a lot of renovations. Disincentivizing investors means fewer of these homes will be our purchased and some will even degrade to an unrepairable state, which further reduces housing supply, which makes it more expensive in the long run.

Re: MIT 11.350: Sustainable Real Estate

#68

Post by bzmrgonz »

Maybe what we need is improvment to hyper-adobe which is being touted as a manual 3D Printer(humans being the processor). The wasp 3d printer looks promising. I wonder if we can simplify it to be manual by maybe stradling the first foot high layer. Alternatively, we could design modern modular wall sectkions akin to SIPs, ive seen some creative pvc sheets out of china lately.

Re: MIT 11.350: Sustainable Real Estate

#69

Post by whatever1 »

worstspotgain wrote: post #31

This is a difficult conversation to have, and not unintentionally so. I hope I come across as respectful and unpatronizing as possible (and apologize since I probably don't.) While we have intelligent people discussing pie-in-the-sky solutions, barely-related tangential issues, and even misdirected injection attacks, the causes of the housing crisis are not only well-known to (honest) economists [1], but can be verif…

It's a supply and demand issue. Zoning only makes things worse.

Check Houston house price hikes in the past 3 years. Once investment funds arrived prices soared by over 2x in some areas. Still no zoning.

The solution is one. BUILD BUILD BUILD.

Re: MIT 11.350: Sustainable Real Estate

#70

Post by worstspotgain »

whatever1 wrote: post #69
worstspotgain wrote: post #31

This is a difficult conversation to have, and not unintentionally so. I hope I come across as respectful and unpatronizing as possible (and apologize since I probably don't.) While we have intelligent people discussing pie-in-the-sky solutions, barely-related tangential issues, and even misdirected injection attacks, the causes of the housing crisis are not only well-known to (honest) economists [1], but can be verif…

It's a supply and demand issue. Zoning only makes things worse. Check Houston house price hikes in the past 3 years. Once investment funds arrived prices soared by over 2x in some areas. Still no zoning. The solution is one. BUILD BUILD BUILD.

Houston's market is still "normal." It was normal before 1970 and has been normal since. Price spikes are also normal and intended. Over time, S&D will respond and bring them back in line.

The solution is indeed build build build. The reason it didn't happen automatically in the first place is disingenuous land use laws like suppressive zoning.

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