6 ms·

How about doing something to address the housing crisis first so all of this money doesn't just end up in landlords pockets? Land value tax maybe?

by danem 7y ago

t-writescode 7y ago
Rather than adding another 10% tax on goods, you mean? Perhaps something to gradually adjust property taxes such that people with multi-million dollar houses aren’t paying taxes as though it’s a multi- thousand dollar house?
- mdorazio 7y ago
  If only there were some kind of proposition that could be phased out over time to accomplish that... perhaps a proposition with an unlucky number. Like 13... This is the problem with the proposition system - it often encourages residents to enact policies in their personal best interests that screw over a huge number of people down the road.
  - riversflow 7y ago
    You know, it would be much more palatable, and much more likely to pass, if instead of phasing out prop 13 entirely, we carved out an exemption for people who only owned one property which was a single-family dwelling. Prop 13 is an important protection for a lot of people on fixed incomes who are also very vulnerable to being displaced from their housing in this high growth state. Kicking seniors out of the homes they’ve spent most of their life in isn’t a very ethical thing to do.
    - t-writescode 7y ago
      What's the percentage of people using it because they're poor, vs using it because it's cheap? At what point do the needs of society overrule the housing needs of the individual? The elderly person will end up a serious multi-millionaire by the end of this in most cases.
    - mdorazio 7y ago
      You'd be carving out an exemption for ~55% of homes. See [1] and [2]. I don't think that really solves the problem, either, because you're still punishing people who want to move to California and disincentivizing new home construction. It would be better than what we have today, though. [1] https://www.infoplease.com/us/california/housing-statistics-237 https://www.infoplease.com/us/california/housing-statistics-... [2] https://journal.firsttuesday.us/californias-rate-of-homeownership-2/30161/ https://journal.firsttuesday.us/californias-rate-of-homeowne...
      - riversflow 7y ago
        >You’d be carving out an exception for ~55% of homes. I don’t think so. Your stats [1] are just for percent of all dwellings, many of those homes are owned by large corporations that then lease them out. If you limited it owning a single home, I think it would be significantly less, more like a 25% exemption by volume(probably less by value) this is backed up by [2] which says home ownership is around 56%. I’m fairly sure more individuals/families than you’d think own more than one home in the state.
JMTQp8lwXL 7y ago
They've tried that. It turns out there's a lot of money to be made by restricting housing growth, as lowered supply drives up property values.
- opportune 7y ago
  Money to be made by people who are already homeowners rather than the government.
  - JMTQp8lwXL 7y ago
    I'm surprised the tech industry hasn't lobbied more for pro-growth, or wielded enough influence to relax zoning restrictions. The Bay Area is slowly losing its stronghold to cheaper cities as it becomes unviable as a place for technologists to start families, etc. The state of California will lose its tax base as high-paying jobs move to other cities out-of-state. There's a lot of losers with housing policy left as it is. It's eating itself. The thing that makes Bay Area property so valuable (many prominent companies co-located) is going to end without more housing.
    - hkarthik 7y ago
      the problem is the tech industry is run by tech execs with high priced Bay Area property. They have no incentive to be pro growth as long as cities like Austin, Seattle accept their “satellite offices” with open arms.
fennecfoxen 7y ago
Oh, yes. Housing is too expensive! Instead of building more housing to compete with it, let's just raise taxes on it! That is unimpeachable and will definitely not result in the housing being more expensive, not at all.
- danem 7y ago
  I suggest you read up on LVT. https://en.wikipedia.org/wiki/Land_value_tax https://en.wikipedia.org/wiki/Land_value_tax https://www.economist.com/briefing/2018/08/09/the-time-may-be-right-for-land-value-taxes https://www.economist.com/briefing/2018/08/09/the-time-may-b... https://www.strongtowns.org/landvaluetax https://www.strongtowns.org/landvaluetax
- lukifer 7y ago
  Note that a land value tax implies a tax on ground rent, not on improvements: http://www.landvaluetax.org/what-is-lvt/ http://www.landvaluetax.org/what-is-lvt/ That said, most areas have overly draconian zoning and regulatory costs (driven in no small part by existing homeowners wanting to protect/inflate their own investment); it's a complex issue, and Ricardian rent-seeking is only one factor.
  - fennecfoxen 7y ago
    Housing development is famously undertaken when developers can sell to landlords who wish to make a profit on the improvements only; all parties involved would be quite willing to spend millions of dollars and to lose money, if it's a loss on the underlying land.

How about doing something to address the housing crisis first so all of this money doesn't just end up in landlords pockets? Land value tax maybe?

by danem 7y ago

How about doing something to address the housing crisis first so all of this money doesn't just end up in landlords pockets? Land value tax maybe?

t-writescode 7y ago

Rather than adding another 10% tax on goods, you mean? Perhaps something to gradually adjust property taxes such that people with multi-million dollar houses aren’t paying taxes as though it’s a multi- thousand dollar house?

mdorazio 7y ago
If only there were some kind of proposition that could be phased out over time to accomplish that... perhaps a proposition with an unlucky number. Like 13... This is the problem with the proposition system - it often encourages residents to enact policies in their personal best interests that screw over a huge number of people down the road.
- riversflow 7y ago
  You know, it would be much more palatable, and much more likely to pass, if instead of phasing out prop 13 entirely, we carved out an exemption for people who only owned one property which was a single-family dwelling. Prop 13 is an important protection for a lot of people on fixed incomes who are also very vulnerable to being displaced from their housing in this high growth state. Kicking seniors out of the homes they’ve spent most of their life in isn’t a very ethical thing to do.
  - t-writescode 7y ago
    What's the percentage of people using it because they're poor, vs using it because it's cheap? At what point do the needs of society overrule the housing needs of the individual? The elderly person will end up a serious multi-millionaire by the end of this in most cases.
  - mdorazio 7y ago
    You'd be carving out an exemption for ~55% of homes. See [1] and [2]. I don't think that really solves the problem, either, because you're still punishing people who want to move to California and disincentivizing new home construction. It would be better than what we have today, though. [1] https://www.infoplease.com/us/california/housing-statistics-237 https://www.infoplease.com/us/california/housing-statistics-... [2] https://journal.firsttuesday.us/californias-rate-of-homeownership-2/30161/ https://journal.firsttuesday.us/californias-rate-of-homeowne...
    - riversflow 7y ago
      >You’d be carving out an exception for ~55% of homes. I don’t think so. Your stats [1] are just for percent of all dwellings, many of those homes are owned by large corporations that then lease them out. If you limited it owning a single home, I think it would be significantly less, more like a 25% exemption by volume(probably less by value) this is backed up by [2] which says home ownership is around 56%. I’m fairly sure more individuals/families than you’d think own more than one home in the state.

JMTQp8lwXL 7y ago

They've tried that. It turns out there's a lot of money to be made by restricting housing growth, as lowered supply drives up property values.

opportune 7y ago
Money to be made by people who are already homeowners rather than the government.
- JMTQp8lwXL 7y ago
  I'm surprised the tech industry hasn't lobbied more for pro-growth, or wielded enough influence to relax zoning restrictions. The Bay Area is slowly losing its stronghold to cheaper cities as it becomes unviable as a place for technologists to start families, etc. The state of California will lose its tax base as high-paying jobs move to other cities out-of-state. There's a lot of losers with housing policy left as it is. It's eating itself. The thing that makes Bay Area property so valuable (many prominent companies co-located) is going to end without more housing.
  - hkarthik 7y ago
    the problem is the tech industry is run by tech execs with high priced Bay Area property. They have no incentive to be pro growth as long as cities like Austin, Seattle accept their “satellite offices” with open arms.

fennecfoxen 7y ago

Oh, yes. Housing is too expensive! Instead of building more housing to compete with it, let's just raise taxes on it! That is unimpeachable and will definitely not result in the housing being more expensive, not at all.

danem 7y ago
I suggest you read up on LVT. https://en.wikipedia.org/wiki/Land_value_tax https://en.wikipedia.org/wiki/Land_value_tax https://www.economist.com/briefing/2018/08/09/the-time-may-be-right-for-land-value-taxes https://www.economist.com/briefing/2018/08/09/the-time-may-b... https://www.strongtowns.org/landvaluetax https://www.strongtowns.org/landvaluetax
lukifer 7y ago
Note that a land value tax implies a tax on ground rent, not on improvements: http://www.landvaluetax.org/what-is-lvt/ http://www.landvaluetax.org/what-is-lvt/ That said, most areas have overly draconian zoning and regulatory costs (driven in no small part by existing homeowners wanting to protect/inflate their own investment); it's a complex issue, and Ricardian rent-seeking is only one factor.
- fennecfoxen 7y ago
  Housing development is famously undertaken when developers can sell to landlords who wish to make a profit on the improvements only; all parties involved would be quite willing to spend millions of dollars and to lose money, if it's a loss on the underlying land.