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Tax the Land

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Re: Tax the Land

#361

Post by diordiderot »

teakettle42 wrote: post #302
Manuel_D wrote: post #284

Earlier quoted context omitted.

This attitude here is precisely why local zoning is ineffective. The people who are negatively impacted by anti-development policies are the ones that don't get the privilege of living in economically powerful population centers in the first place. Sure, the home-owners might grumble about an apartment blocking their view, more crowded restaurants, or "neighborhood character as a city grows. The people who are negati…

> … and the people who can't even afford to move there in the first place. There’s no inalienable right to live in a popular place you cannot afford. Can you articulate an ethical argument for why it’s a problem that not everyone can afford to move to the most desirable cities?

> There’s no inalienable right

There are zero inalienable rights

Re: Tax the Land

#362

Post by dbspin »

teakettle42 wrote: post #337
Manuel_D wrote: post #333

Earlier quoted context omitted.

There's no inalienable right to not be cripplingly impoverished. But any ethical countries would try to ameliorate that condition. Is it ethical for a select few to grow enormously wealthy by driving up the cost of living for the many by deliberately causing a shortage of a basic need? People need jobs to live. They also need a roof over their heads. The jobs are becoming increasingly concentrated in a few metro area…

> deliberately causing a shortage of a basic need There’s no housing shortage. There’s a limited supply in highly desirable locations because they’re highly desirable. People can and do live elsewhere, working local jobs or commuting. > The jobs are becoming increasingly concentrated in a few metro areas That’s just one of many problems of scale; the solution is not to keep scaling up. > … the home-owning class const…

Just to address this from a non US standpoint. While I'm sympathetic toward both the desire to preserve the character and community of a neighbourhood and your antipathy towards rentiers - there absolutely is a housing crisis across Europe (and presumably in the US).

Part of the reason is the lack of social housing provision, with most EU governments reducing or all together abandoning their post war commitments to low cost housing.

Another reason is that, even in this era of remote work, the enormous majority of high paying jobs do require living in a large population centre.

Perhaps the largest reason is the financialisation of housing as an asset class by hedge and other vulture funds. Italy alone seems to have kept the housing crisis / shortage localised to wealthy cities - and it is the only wealthy EU country to have done so. Germany, Ireland, France etc, all have rents and housing costs far higher than their median citizens capacity to comfortably pay, even in very remote and economically depressed areas.

Italy by contrast charges high taxes on 2nd and 3rd properties, effectively blocking the aggregation of empty / underused housing stock. Which has resulted in rural areas and less populous cities being reasonably priced to live in. This is not the case anywhere else in Western Europe.

Re: Tax the Land

#363

Post by jjav »

apendleton wrote: post #346
mdorazio wrote: post #9

Not really stated in the article are three caveats: 1) Zoning laws have to change as well to actually allow development of the land being taxed toward more productive ends. 2) The land tax amount needs to be high enough that the pain of the tax effectively forces owners to improve what's on the land. A homeowner sitting on a million dollar piece of property in California taxed at ~1% is still unlikely to build an apa…

> 1) Zoning laws have to change as well to actually allow development of the land being taxed toward more productive ends. This is addressed to some extent, with the argument that zoning reforms are more practical because existing property owners are incentivized to support rather than fight zoning updates that allow more development, so they can fully maximize the ratio of their revenue against the tax. (“It turns N…

> existing property owners are incentivized to support rather than fight zoning updates that allow more development

Regular people who own some land are not going to have the capital or skillset to tear down their house and build a highrise on the plot of land.

So what a LVT does, is to force individual landowners to sell land off to giant developer corporations who do have the resources to make it happen.

Consolidation of all ownership onto a few large players is not a good thing for society.

Re: Tax the Land

#364

Post by diordiderot »

teakettle42 wrote: post #337
Manuel_D wrote: post #333

Earlier quoted context omitted.

There's no inalienable right to not be cripplingly impoverished. But any ethical countries would try to ameliorate that condition. Is it ethical for a select few to grow enormously wealthy by driving up the cost of living for the many by deliberately causing a shortage of a basic need? People need jobs to live. They also need a roof over their heads. The jobs are becoming increasingly concentrated in a few metro area…

> deliberately causing a shortage of a basic need There’s no housing shortage. There’s a limited supply in highly desirable locations because they’re highly desirable. People can and do live elsewhere, working local jobs or commuting. > The jobs are becoming increasingly concentrated in a few metro areas That’s just one of many problems of scale; the solution is not to keep scaling up. > … the home-owning class const…

Yes, the solution is to keep scaling up.

_No_ economy can _sustain_ American style suburban growth.

Read about 'the growth ponzi scheme' [1] or watch a video

https://www.strongtowns.org/the-growth-ponzi-scheme

https://youtu.be/y_SXXTBypIg

Re: Tax the Land

#365

Post by jjav »

mdorazio wrote: post #65
bombcar wrote: post #12

Earlier quoted context omitted.

The average single-family dwelling landlord is subsidizing someone; rents are usually below actual carrying costs (maintenance, etc) and most landlords would be better off selling. It’s one of the reasons banks and companies aren’t in the single family rental business. The main thing that covers for it is property appreciation - the rent is used to just offset carrying costs while you wait for the property to go up i…

I'm strongly going to need a source to back up your claim.

Try doing the exercise yourself to be convinced. Check out zillow/redfin/etc for properties and then do the planning to buy and rent it. Consider all costs. Look at equivalent rents in that area. Can you make any profit? Probably not.

Source: been doing this spreadsheet exercise for more than a decade. Have never found a property I could buy and rent out at a profit.

Re: Tax the Land

#366

Post by gameman144 »

I totally get the appeal of land taxes and restriction of land-use regulation at the local level, and by and large they seem like a reasonable approach to poor resource allocation and unequal ownership opportunities. One thing I've not seen addressed, though, is the apparent disincentive to improve communities in meaningful ways.

For instance, say I live in a very expensive city and I can no longer afford the land tax. I decide to move to a less expensive city and set up roots there. This new city is crummier: the city government is inefficient, there are fewer amenities available, and local institutions are poorly organized and executed.

I spend some time petitioning the local government to make reforms, I work with local groups to improve city amenities, and I vote for policies to revive local institutions. As I do this, the city becomes much nicer. However, it also becomes more attractive for other folks from the expensive city who can afford to buy up local property and drive up the value/taxes of my land. If this goes on, I'll once again be in a situation where I can't afford to live in my home because others want to live there too.

Say if, after moving to my cheaper city, I had instead decided to keep the city as crummy as possible while meeting my own needs. I drive a car, so I vote against bike lanes. I don't have young kids, so I lobby against school levies. I don't swim, so I vote against a public pool. This is objectively worse for the city as a whole, but if I want to be able to afford to live in a city that meets my needs these are the actions I should take.

There are always going to be tradeoffs between the opportunities of people who live in places and those who want to live in those places. Stringent local regulations weigh heavily in favor of those who currently live in places, and this is widely recognized (e.g. the term NIMBY is widely known). Land taxes and deregulated local zoning seem to weigh heavily in the opposite direction, but I rarely see this addressed or acknowledged. Moreover, land taxes in particular seem like they actively disincentivize pro-social or civically minded policies for existing residents (whereas local regulations allow communities to improve themselves without being priced out through other means).

If I'm missing some context here let me know, but it's one of my main critiques when these proposals pop up that I've never seen satisfactorily addressed.

Re: Tax the Land

#367

Post by closeparen »

teakettle42 wrote: post #302
Manuel_D wrote: post #284

Earlier quoted context omitted.

This attitude here is precisely why local zoning is ineffective. The people who are negatively impacted by anti-development policies are the ones that don't get the privilege of living in economically powerful population centers in the first place. Sure, the home-owners might grumble about an apartment blocking their view, more crowded restaurants, or "neighborhood character as a city grows. The people who are negati…

> … and the people who can't even afford to move there in the first place. There’s no inalienable right to live in a popular place you cannot afford. Can you articulate an ethical argument for why it’s a problem that not everyone can afford to move to the most desirable cities?

America’s housing supply will grow. A policy that it grows only by sprawl is a policy of cruelty to everyone today and in the future who thrives best in an urban environment and isn’t super-rich.

Urban environments can’t be stamped onto cornfields; they only occur when sparser environments become expensive. I don’t think there’s a right to live in any arbitrary expensive town. I do think there’s a right to have the expensive-town-to-city pipeline running somewhere at more than a trickle, so that urbanism is not impossible to access.

Re: Tax the Land

#368

Post by jjav »

long_time_gone wrote: post #78
bombcar wrote: post #70

Earlier quoted context omitted.

Find banks or real-estate companies that invest in single family homes for the purpose of renting them. If you can find one, you often find that they'd rather let the property sit empty than renting it. Or just look at the cost of buying a house vs renting a similar house, account for maintenance, and see if the numbers line up.

This isn’t really a source though, it’s requiring the other commenter to prove the point you made. Anecdotally, I know people who buy single family homes and rent them for profit. My 3 bed, 2 bath single-family home has a $3,000/monthly mortgage, I could easily rent it for more than $3,500 (closer to $4,000). Take out 10% for maintenance fees, and I net $200 a month.

> Anecdotally, I know people who buy single family homes and rent them for profit. My 3 bed, 2 bath single-family home has a $3,000/monthly mortgage, I could easily rent it for more than $3,500 (closer to $4,000). Take out 10% for maintenance fees, and I net $200 a month.

In other words, you could not make a profit.

You need to consider all costs, not just mortgage. Taxes, insurance, maintenance, repairs, downtime (when it sits empty between renters).

If your mortgage is $3000 and you can only rent it for less than $4000, you can't make a profit.

I go through this math often while daydreaming of renting my house and retiring somewhere cheaper. There isn't any scenario I can come up with where it would actually be profitable.

Re: Tax the Land

#369

Post by geocar »

teakettle42 wrote: post #302
Manuel_D wrote: post #284

Earlier quoted context omitted.

This attitude here is precisely why local zoning is ineffective. The people who are negatively impacted by anti-development policies are the ones that don't get the privilege of living in economically powerful population centers in the first place. Sure, the home-owners might grumble about an apartment blocking their view, more crowded restaurants, or "neighborhood character as a city grows. The people who are negati…

> … and the people who can't even afford to move there in the first place. There’s no inalienable right to live in a popular place you cannot afford. Can you articulate an ethical argument for why it’s a problem that not everyone can afford to move to the most desirable cities?

> There’s no inalienable right to live in a popular place you cannot afford.

There's no right to anything that people don't stand together to say they have a right to.

> Can you articulate an ethical argument for why it’s a problem that not everyone can afford to move to the most desirable cities?

People shouldn't have to commute for hours so other people can live there because that impacts their health and opportunities for life, liberty, and the pursuit of happiness. If this is where the jobs are, there should be homes here as well.

Re: Tax the Land

#370

Post by jjav »

andrepd wrote: post #7

There is something deeply wrong with the fact that you can buy-to-rent a property and immediately turn up a profit, essentially inserting yourself as a parasitic middleman in the process, providing no service, and extracting an economic rent.

> There is something deeply wrong with the fact that you can buy-to-rent a property and immediately turn up a profit

Could you please post here a handful of links (zillow/redfin/etc) to properties one could buy-to-rent and immediately turn up a profit? (Considering all costs.)

I've been looking for over a decade and haven't found one, so it would be most helpful to see a few examples.

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