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> … which you didn't have to work for? To rent out property you must first own property. To own property you must buy property. Buying property requires resour

> … which you didn't have to work for? To rent out property you must first own property. To own property you must buy property. Buying property requires resources. Accumulating enough resources to buy property requires a great deal of work, to say nothing of the effort which goes in to deciding which properties to buy or sell or the opportunity cost of deferring consumption. All of that work occurs before the first rent check is paid or any property management fees are accrued (assuming you hired someone else to manage the property). The concept may seem alien to someone accustomed to a weekly or biweekly paycheck from their employer, but in many fields, including investment (in real estate or anything else), the majority of the work occurs long before any income is received. The income is no less earned merely because it does not occur in close proximity to the work.

ZeroGravitas 6y ago
The important parts of the discussion can be seen more clearly if we compare two different landlords rather than landlords vs non-landlords. Then it should become obvious that some part of the profit is due to "work" i.e. investing money in an area by building upgrading, and some part is due to other people doing the same. So in a hot new area, a bunch of people moving in, opening hip restaurants, renovating old buildings, improving parks contributes to the landlords profit, because an empty lots value will rise as well.
- nybble41 6y ago
  Does the landlord get any credit for encouraging development in the surrounding area? For that matter, these "other people" may even be the same person in some cases, in which case they're both paying for the development and paying extra LVT due to the general rise in property values which they created. Even recognized physical improvements to your own property can cause property values for surrounding empty lots to rise, and you'd be paying LVT on that as well. Let's look at a hypothetical case for a moment. Say I buy some otherwise nice property for cheap because it's in the middle of nowhere and there is no easy way to get to it. Trees, lakes, etc. but no nearby roads. The LVT would be low, right? If you auctioned it off in that state as unimproved property you wouldn't get many takers. But say I build a private road to that area at my own expense, and then rent out the now-accessible land in family-size lots. The land hasn't changed, but its value is much higher now because of something I did. How would the "unimproved" value of those lots be assessed, and who receives the LVT? If the answer to that last question isn't "me" (and it won't be) then someone is receiving an unearned benefit from my work. Even if you think it's somehow "unfair" for property owners to benefit financially from general improvements in their communities, LVT doesn't change the fact that someone is still getting an unearned external benefit. It takes from the property owner without doing much at all to ensure that the LVT goes to the parties actually responsible for the improvement.
  - ZeroGravitas 6y ago
    If it genuinely is a private road then why would those plots be more valuable? If someone opened a business there you'd be able to extract all their profits since you control the only access. Of course in reality it's not a private road or private sewer system or private fire service or private police force, it's all provided by government via taxes. Taxes that people pay based on how much they earn, a far more obvious source of people being penalised for doing the right thing. If you have an empty lot and you improve the district you can get your reward by selling the plot or opening your own business on it. Under LVT what you can't do is just sit on it for years at no cost to yourself, but great costs to others just in case it turns out to be a lottery ticket.
    - nybble41 6y ago
      > If it genuinely is a private road then why would those plots be more valuable? One assumes that the people I'm renting the lots to are permitted to use the road as part of their contract. But let's make this simple and say that I offer a perpetual agreement to let anyone use this road at cost, whether they rent from me or not. The road is a loss-leader; I intend to make my money by renting out the land, not by operating a toll road. There are plenty of examples of communities with their own private roads and other services. Not everything of value to a community is provided by the government. > you can get your reward by selling the plot That won't work. Whoever buys it would be taking over the LVT payments, so that expense will come out of the resale value of the property. > Under LVT what you can't do is just sit on it for years at no cost to yourself, but great costs to others just in case it turns out to be a lottery ticket. And here we once again have someone failing to see the economic value of speculation. The only reason to "sit on" the land and not use it would be that any use you could put the land to now would interfere with taking advantage of an even more valuable opportunity which you anticipate in the future. Not holding the land in readiness for that more valuable future use under such circumstances would be destructive.
pydry 6y ago
>To rent out property you must first own property. To own property you must buy property. Or inherit. Mayfair is rented out by the Duke of Westminster not because him or any or his ancestors did anything as crass as buying it but because he traces his lineage back to a mate of William the conqueror (note : not William the buyer. Conqueror. The distinction is important you see) in 1066. Broadly speaking, all land wealth is derived this way, no matter how many hands it passes through on the way to its current owner. You no doubt believe that the act of buying and selling land and working with it somehow "morally sterilizes" it. It does not. If Mayfair was sold it would still be conquered wealth. I am very well aware that investments do not necessarily pay off immediately and you know very well that that is not what I am talking about at all.
- nybble41 6y ago
  > You no doubt believe that the act of buying and selling land and working with it somehow "morally sterilizes" it. Nonsense. If that particular plot of land was stolen then the people it was stolen from are welcome to assert their claim. If they can prove that they have one, that is. A thief ("conqueror") does not through their theft obtain the rights to the property which is stolen, and cannot rightfully sell what they do not own. The buyer acquires nothing, and (if innocent) is welcome to sue the thief for fraud to recover what they paid. However, leaving the ownership uncontested for this long would certainly dilute any claim based on ancestral rights. If there comes a point where no one else is claiming rightful ownership of the land then any prior claim can be considered abandoned, and whoever happens to be using it at that point holds the rights to it by default. Even if it was originally stolen. So the question becomes, has someone maintained their claim to the land and passed it down to their descendents from 1066 until now? Or was that claim permitted to lapse?
  - pydry 6y ago
    >whoever happens to be using it at that point holds the rights to it by default. Even if it was originally stolen. The duke of westminster doesn't use the land, though, he rents it out. If use of land begets ownership, why does the claim originally stem from william the conqueror murdering a bunch of peasants rather than me renting a flat since 2005? This idea of yours makes no sense.

ZeroGravitas 6y ago

The important parts of the discussion can be seen more clearly if we compare two different landlords rather than landlords vs non-landlords. Then it should become obvious that some part of the profit is due to "work" i.e. investing money in an area by building upgrading, and some part is due to other people doing the same. So in a hot new area, a bunch of people moving in, opening hip restaurants, renovating old buildings, improving parks contributes to the landlords profit, because an empty lots value will rise as well.

nybble41 6y ago
Does the landlord get any credit for encouraging development in the surrounding area? For that matter, these "other people" may even be the same person in some cases, in which case they're both paying for the development and paying extra LVT due to the general rise in property values which they created. Even recognized physical improvements to your own property can cause property values for surrounding empty lots to rise, and you'd be paying LVT on that as well. Let's look at a hypothetical case for a moment. Say I buy some otherwise nice property for cheap because it's in the middle of nowhere and there is no easy way to get to it. Trees, lakes, etc. but no nearby roads. The LVT would be low, right? If you auctioned it off in that state as unimproved property you wouldn't get many takers. But say I build a private road to that area at my own expense, and then rent out the now-accessible land in family-size lots. The land hasn't changed, but its value is much higher now because of something I did. How would the "unimproved" value of those lots be assessed, and who receives the LVT? If the answer to that last question isn't "me" (and it won't be) then someone is receiving an unearned benefit from my work. Even if you think it's somehow "unfair" for property owners to benefit financially from general improvements in their communities, LVT doesn't change the fact that someone is still getting an unearned external benefit. It takes from the property owner without doing much at all to ensure that the LVT goes to the parties actually responsible for the improvement.
- ZeroGravitas 6y ago
  If it genuinely is a private road then why would those plots be more valuable? If someone opened a business there you'd be able to extract all their profits since you control the only access. Of course in reality it's not a private road or private sewer system or private fire service or private police force, it's all provided by government via taxes. Taxes that people pay based on how much they earn, a far more obvious source of people being penalised for doing the right thing. If you have an empty lot and you improve the district you can get your reward by selling the plot or opening your own business on it. Under LVT what you can't do is just sit on it for years at no cost to yourself, but great costs to others just in case it turns out to be a lottery ticket.
  - nybble41 6y ago
    > If it genuinely is a private road then why would those plots be more valuable? One assumes that the people I'm renting the lots to are permitted to use the road as part of their contract. But let's make this simple and say that I offer a perpetual agreement to let anyone use this road at cost, whether they rent from me or not. The road is a loss-leader; I intend to make my money by renting out the land, not by operating a toll road. There are plenty of examples of communities with their own private roads and other services. Not everything of value to a community is provided by the government. > you can get your reward by selling the plot That won't work. Whoever buys it would be taking over the LVT payments, so that expense will come out of the resale value of the property. > Under LVT what you can't do is just sit on it for years at no cost to yourself, but great costs to others just in case it turns out to be a lottery ticket. And here we once again have someone failing to see the economic value of speculation. The only reason to "sit on" the land and not use it would be that any use you could put the land to now would interfere with taking advantage of an even more valuable opportunity which you anticipate in the future. Not holding the land in readiness for that more valuable future use under such circumstances would be destructive.

pydry 6y ago

>To rent out property you must first own property. To own property you must buy property. Or inherit. Mayfair is rented out by the Duke of Westminster not because him or any or his ancestors did anything as crass as buying it but because he traces his lineage back to a mate of William the conqueror (note : not William the buyer. Conqueror. The distinction is important you see) in 1066. Broadly speaking, all land wealth is derived this way, no matter how many hands it passes through on the way to its current owner. You no doubt believe that the act of buying and selling land and working with it somehow "morally sterilizes" it. It does not. If Mayfair was sold it would still be conquered wealth. I am very well aware that investments do not necessarily pay off immediately and you know very well that that is not what I am talking about at all.

nybble41 6y ago
> You no doubt believe that the act of buying and selling land and working with it somehow "morally sterilizes" it. Nonsense. If that particular plot of land was stolen then the people it was stolen from are welcome to assert their claim. If they can prove that they have one, that is. A thief ("conqueror") does not through their theft obtain the rights to the property which is stolen, and cannot rightfully sell what they do not own. The buyer acquires nothing, and (if innocent) is welcome to sue the thief for fraud to recover what they paid. However, leaving the ownership uncontested for this long would certainly dilute any claim based on ancestral rights. If there comes a point where no one else is claiming rightful ownership of the land then any prior claim can be considered abandoned, and whoever happens to be using it at that point holds the rights to it by default. Even if it was originally stolen. So the question becomes, has someone maintained their claim to the land and passed it down to their descendents from 1066 until now? Or was that claim permitted to lapse?
- pydry 6y ago
  >whoever happens to be using it at that point holds the rights to it by default. Even if it was originally stolen. The duke of westminster doesn't use the land, though, he rents it out. If use of land begets ownership, why does the claim originally stem from william the conqueror murdering a bunch of peasants rather than me renting a flat since 2005? This idea of yours makes no sense.