Once a person owns a home in a location, restricting supply means their home goes up in value, and their neighbourhood stays as cozy as it is today. This is why Georgism (championed by every notable economist for more than a century) is the only way we solve this. A land value tax aligns individual incentives with best social outcomes. People are much more reluctant to sit on unused land if they’re being charged 5% per year in tax. They build up. They aggressively lobby their local politicians to make it as easy as possible to build. Supply booms.
This is a solved problem. It’s not complicated. Austin did it. They cut regulation, developers went crazy building apartments, and rents keep dropping. Landlords have to compete to get tenants now, offering everything from 3 months free rent to gym membership and gift certificates.
whats nuts is people want their homes to go up in value. You pay taxes based on home value. I want my home to be lagging behind everything in the area im not cheering everything getting more expensive. Its like are all these people flipping every two years???
Property taxes are typically very low compared to the capital gains they will accrue. On balance, it’s still a great deal for the individual if home values skyrocket. Of course, it’s terrible for society. On the other hand, if land taxes were 5%, then you would be correct: people would hate for their properties to jump in value. If they went up too much, they would sell and move elsewhere, pushing up supply and reducing prices.
You pay taxes based on relative home value, not absolute value. If everyone’s house goes up by the same percentage, everyone still pays the same amount of tax. It’s only when you make big renovations or additions that your property taxes go up relative to your neighbours.
yeah but that is what people get excited about. The value going up of theres or the complex and not in the whole area. I want my place to be the cheapest in the area. Until I need to move of course then I want it highly overvalued.
I’m surprised no one has identified the core issue here: local restrictions - NIMBYs. A National Association of Home Builders (NAHB) / NMHC study found that government regulations across all levels (fees, permitting, compliance) account for 40.6% of multifamily development costs on average nationally.
Once a person owns a home in a location, restricting supply means their home goes up in value, and their neighbourhood stays as cozy as it is today. This is why Georgism (championed by every notable economist for more than a century) is the only way we solve this. A land value tax aligns individual incentives with best social outcomes. People are much more reluctant to sit on unused land if they’re being charged 5% per year in tax. They build up. They aggressively lobby their local politicians to make it as easy as possible to build. Supply booms.
This is a solved problem. It’s not complicated. Austin did it. They cut regulation, developers went crazy building apartments, and rents keep dropping. Landlords have to compete to get tenants now, offering everything from 3 months free rent to gym membership and gift certificates.
whats nuts is people want their homes to go up in value. You pay taxes based on home value. I want my home to be lagging behind everything in the area im not cheering everything getting more expensive. Its like are all these people flipping every two years???
Property taxes are typically very low compared to the capital gains they will accrue. On balance, it’s still a great deal for the individual if home values skyrocket. Of course, it’s terrible for society. On the other hand, if land taxes were 5%, then you would be correct: people would hate for their properties to jump in value. If they went up too much, they would sell and move elsewhere, pushing up supply and reducing prices.
You pay taxes based on relative home value, not absolute value. If everyone’s house goes up by the same percentage, everyone still pays the same amount of tax. It’s only when you make big renovations or additions that your property taxes go up relative to your neighbours.
yeah but that is what people get excited about. The value going up of theres or the complex and not in the whole area. I want my place to be the cheapest in the area. Until I need to move of course then I want it highly overvalued.