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I would much prefer a land value tax and relaxation of regulations preventing new construction (in London you can't build in certain areas/over a certain height

I would much prefer a land value tax and relaxation of regulations preventing new construction (in London you can't build in certain areas/over a certain height because of Protected Views [1], which seems utterly bizarre, as if maintaining views is more important than sufficient housing) [1] https://en.wikipedia.org/wiki/Protected_view https://en.wikipedia.org/wiki/Protected_view

ukoki 8y ago
How about just taxing the profits of house sales exorbitantly? Eg 70% tax on profits of house sales unless you are a UK resident and it's your only home. This way it's still worth buying housing with the intention of leasing it, but buying housing just to sit on it will be drastically less profitably.
- rzwitserloot 8y ago
  There are 2 kinds of home owner. In the netherlands we have a saying: "Little house, little tree, little animal" (huisje, boompje, beestje). It means: Family life in a suburban home with a pet, a kid or two, a house with a garden, a car on the porch, a stable job, and the home is yours, you're paying off your mortgage, and you'll grow old with a nice nest egg in the form of having built up actual ownership, converting your salary into paying off the mortgage in the timespan of your career. That's one kind of home owner. Of particular note is that at least in The Netherlands, and I bet in the UK too, the government likes this image. Most citizens do too. So, there are tax breaks for paying off mortgages and such. The other kind buys as many houses as they can, converts it to crappy rent and because the dream, and the government's policies, are somehow trying to marry the mutually exclusive notions of 'anybody should be able to afford a starter house' and 'all houses should be good investments, giving you more return than just sticking that money in a bank someplace', rent is really high because the competition of just buying a house is really expensive too. I bet that it is politically virtually impossible to attempt to deal a blow to the 'huisje, boompje, beestje' owners even if it makes perfect socio-economic sense. So, seeing that as a political impossibility, you're looking for a way to somehow tax only the second category and also doing it in a way that lobbyers of the second category can't misconstrue your plan to get the first category on board. I bet this is extremely hard to do: It's all one market, after all. If the second category is taxed into oblivion, their demand will cease to exist, which means house prices, also the house prices of the 'huisje boompje beestje' folks will fall drastically. This will do excellent things to the affordability of rent, but it makes those career folks edgy, to say the least. It'll take quite a while for sufficient generational turnover (and 'the youths' need to vote A LOT more. Even if it does not matter at all; politicians are incentivised to chase policies that benefit those who vote) for me to believe any law that will screw over HBB folk is going to pass.
  - esotericn 8y ago
    Your final sentence seems to assume that the youth don't want what you're calling a "HBB" life. They may not be able to achieve it, but if anything, I'd think that they're more likely to vote in favour of it. I'm young. Effectively since high school I've been working towards that life. It's what I consider to be a good, successful life. Relaxing in front of the fire or kicking about in the garden with the kids. In the UK we don't have the American exurb life for the most part, but a little terraced house with a garden on a quiet street - sign me up. There is nothing impossible about this unless you expect that an infinite number of people should pile into one city regardless of economic viability.
  - tobylane 8y ago
    The second type usually uses a BTL (buy to let) mortgage, which can be interest-only and feasible where an occupier's mortgage wouldn't be. The UK government has successfully made these considerably less appealing, such as cutting tax relief on BTL mortgage payments. The housing was released into the better parts of the housing market.
izacus 8y ago
How is that sustainable though? This means destroying more environment by building essentially empty spaces and forcing more and more people to drive longer distances to reach cities.
rzwitserloot 8y ago
Protected view is an oversimplification. As in, whilst the law names, and officially only ensures protected views, the actual effects of that law go a little further than that and I bet plenty in the law making profession are aware of this, but feel that the law as is is sufficient. Specifically: The protected view law reduces crowding. Without it, the # of folks living per square kilometer in London would be higher than it is right now, and that would mean London needs to expand all sorts of services (medical, public transport, heck, even the # of butchers and the like), needs to deal with more concentrated pollution, and in general just needs to 'run better' just to keep up the same standard. And that is not a stupid goal. Yes, it clashes with affordable rent. I have no solutions, just pointing out that the idea 'hey, affordable rent is way more important than protected views, so, duh, get rid of that law!' is probably a bit shortsighted.
- avar 8y ago
  It is a stupid way to achieve the goal because if you're legitimately trying to mitigate other specific things you could tax for those things. E.g. for one example you mentioned allow new development, but set trash disposal fees at some absurd amount. It also assumes a zero-sum economy. Once you have more population density you have more of a tax base to pay for all those things, and some fixed costs go down as density goes up. The claim that public transit of all things is going to get worse with higher density is, frankly, ridiculous. If it really persists as a problem you can use the extra money from the new tax base to bring in urban planners from Tokyo. > I have no solutions[...] I have one to address NIMBY-ism everywhere: We say sure, you can have "protected views" or whatever, but then you need to pay market value for those things. We'll see how long that lasts when people need to pay out of pocket for the opportunity cost of not constructing a skyscraper just to occasionally enjoy the view, as opposed to incumbents getting to vote for "free" and getting the direct benefit of their property values rising.
njepa 8y ago
Why would the rich want sufficient housing? As long as you can remove rent control the rich benefits from scarcity of housing. They get more rent income, higher property values and less competition. It makes being wealthy much more useful that it would be otherwise.
deleted 8y ago
[deleted]

ukoki 8y ago

How about just taxing the profits of house sales exorbitantly? Eg 70% tax on profits of house sales unless you are a UK resident and it's your only home. This way it's still worth buying housing with the intention of leasing it, but buying housing just to sit on it will be drastically less profitably.

rzwitserloot 8y ago
There are 2 kinds of home owner. In the netherlands we have a saying: "Little house, little tree, little animal" (huisje, boompje, beestje). It means: Family life in a suburban home with a pet, a kid or two, a house with a garden, a car on the porch, a stable job, and the home is yours, you're paying off your mortgage, and you'll grow old with a nice nest egg in the form of having built up actual ownership, converting your salary into paying off the mortgage in the timespan of your career. That's one kind of home owner. Of particular note is that at least in The Netherlands, and I bet in the UK too, the government likes this image. Most citizens do too. So, there are tax breaks for paying off mortgages and such. The other kind buys as many houses as they can, converts it to crappy rent and because the dream, and the government's policies, are somehow trying to marry the mutually exclusive notions of 'anybody should be able to afford a starter house' and 'all houses should be good investments, giving you more return than just sticking that money in a bank someplace', rent is really high because the competition of just buying a house is really expensive too. I bet that it is politically virtually impossible to attempt to deal a blow to the 'huisje, boompje, beestje' owners even if it makes perfect socio-economic sense. So, seeing that as a political impossibility, you're looking for a way to somehow tax only the second category and also doing it in a way that lobbyers of the second category can't misconstrue your plan to get the first category on board. I bet this is extremely hard to do: It's all one market, after all. If the second category is taxed into oblivion, their demand will cease to exist, which means house prices, also the house prices of the 'huisje boompje beestje' folks will fall drastically. This will do excellent things to the affordability of rent, but it makes those career folks edgy, to say the least. It'll take quite a while for sufficient generational turnover (and 'the youths' need to vote A LOT more. Even if it does not matter at all; politicians are incentivised to chase policies that benefit those who vote) for me to believe any law that will screw over HBB folk is going to pass.
- esotericn 8y ago
  Your final sentence seems to assume that the youth don't want what you're calling a "HBB" life. They may not be able to achieve it, but if anything, I'd think that they're more likely to vote in favour of it. I'm young. Effectively since high school I've been working towards that life. It's what I consider to be a good, successful life. Relaxing in front of the fire or kicking about in the garden with the kids. In the UK we don't have the American exurb life for the most part, but a little terraced house with a garden on a quiet street - sign me up. There is nothing impossible about this unless you expect that an infinite number of people should pile into one city regardless of economic viability.
- tobylane 8y ago
  The second type usually uses a BTL (buy to let) mortgage, which can be interest-only and feasible where an occupier's mortgage wouldn't be. The UK government has successfully made these considerably less appealing, such as cutting tax relief on BTL mortgage payments. The housing was released into the better parts of the housing market.

izacus 8y ago

How is that sustainable though? This means destroying more environment by building essentially empty spaces and forcing more and more people to drive longer distances to reach cities.

rzwitserloot 8y ago

Protected view is an oversimplification. As in, whilst the law names, and officially only ensures protected views, the actual effects of that law go a little further than that and I bet plenty in the law making profession are aware of this, but feel that the law as is is sufficient. Specifically: The protected view law reduces crowding. Without it, the # of folks living per square kilometer in London would be higher than it is right now, and that would mean London needs to expand all sorts of services (medical, public transport, heck, even the # of butchers and the like), needs to deal with more concentrated pollution, and in general just needs to 'run better' just to keep up the same standard. And that is not a stupid goal. Yes, it clashes with affordable rent. I have no solutions, just pointing out that the idea 'hey, affordable rent is way more important than protected views, so, duh, get rid of that law!' is probably a bit shortsighted.

avar 8y ago
It is a stupid way to achieve the goal because if you're legitimately trying to mitigate other specific things you could tax for those things. E.g. for one example you mentioned allow new development, but set trash disposal fees at some absurd amount. It also assumes a zero-sum economy. Once you have more population density you have more of a tax base to pay for all those things, and some fixed costs go down as density goes up. The claim that public transit of all things is going to get worse with higher density is, frankly, ridiculous. If it really persists as a problem you can use the extra money from the new tax base to bring in urban planners from Tokyo. > I have no solutions[...] I have one to address NIMBY-ism everywhere: We say sure, you can have "protected views" or whatever, but then you need to pay market value for those things. We'll see how long that lasts when people need to pay out of pocket for the opportunity cost of not constructing a skyscraper just to occasionally enjoy the view, as opposed to incumbents getting to vote for "free" and getting the direct benefit of their property values rising.

njepa 8y ago

Why would the rich want sufficient housing? As long as you can remove rent control the rich benefits from scarcity of housing. They get more rent income, higher property values and less competition. It makes being wealthy much more useful that it would be otherwise.

deleted 8y ago

[deleted]