4 ms·

It seems strange to have a tax that is based on the subjective motivations of a property owner. How would you even know why someone wasn't renting out a given p

by harryh 6y ago

It seems strange to have a tax that is based on the subjective motivations of a property owner. How would you even know why someone wasn't renting out a given property at a given moment in time?

leetcrew 6y ago
what else would someone be doing with a property that they aren't themselves living in? if you support a punitive tax on people holding out for higher rent, you probably don't care if it also hits people who are merely speculating on real estate.
- harryh 6y ago
  - Maybe they want to move into it later. - Maybe they haven't found a suitable tenant yet. - Maybe they are holding it open for a friend or family member. - Maybe they want to do some renovations before renting it out. - Maybe they want to sell the property and it's easier to sell without an existing tenant. I can think of lots of reasons.
  - sudosysgen 6y ago
    >- Maybe they want to move into it later. Then they should lease it meanwhile or pay the tax, it's rare for people to buy houses fully finished, say, a year in advance. >- Maybe they haven't found a suitable tenant yet. They can lower the price to find a suitable tenant faster. >- Maybe they are holding it open for a friend or family member. Then that friend or family can move there officially while still occupying their current dwelling until the grace period expires again. >- Maybe they want to do some renovations before renting it out. These laws in practice have an exemption for rénovations. >- Maybe they want to sell the property and it's easier to sell without an existing tenant. Then they should price it as to sell within the grace period, or pay the tax.
    - harryh 6y ago
      What's so special about housing that you need an extra special tax like this? We don't have it for cars or machinery or other kinds of capital goods. I'll answer my own question: the root problem of too high rents is that governments: 1) have outlawed the construction of enough new housing to meet demand. 2) many places (CA especially) have property taxes that are drastically too low (and in CA's case, radically unfair). Vacancy taxes are a bad hack. As you note in your comment you have to build in all kinds of grace periods or exceptions and even these can often be easily gamed or ignored. Cities will be much better off if they fix the real underlying problems.
      - deleted 6y ago
        [deleted]
      - sudosysgen 6y ago
        This law was implemented in Vancouver. It worked at reducing vacanies. It wasn't gamed, because the fact that a person can only have one residence and that that confers a lot of rights is enough to dissuade it. >What's so special about housing that you need an extra special tax like this? We don't have it for cars or machinery or other kinds of capital goods. Land is not capital. It is not infinitely reproducible. You can't make more land, and as a result there is hard limit to any one kind of housing. >1) have outlawed the construction of enough new housing to meet demand. I agree that this should be fixed >2) in many places (CA especially) have property taxes that are drastically too low (and in CA's case, radically unfair). That is really far from being the reason for high rents, since most places with high rents don't have Prop 13.
        imtringued 6y ago
        Prop 13 causes all cities in CA to collude against building more housing. Any city that breaks this gets "punished" with the full force of other Californians escaping their poorly planned city.
      - lelandbatey 6y ago
        I cannot manufacture more land downtown, while a car can be manufactured and moved wherever. Land, unlike other capital goods, cannot move to meet demand.
  - acdha 6y ago
    There are possible reasons but it’s important to remember that there are also costs: empty buildings don’t contribute to the local culture or economy, and can become an eyesore or attract crime. A tax helps encourage owners to minimize those negatives and could easily be phased in or have an appeal process (e.g. show that you have building permits for a 6 month waiver).
sudosysgen 6y ago
Who cares why? If they can't find a tenant beyond a certain amount of time, they can be made to pay a tax, lower the price to find one faster, or sell.
tshaddox 6y ago
Lots of laws are based on subjective motivations of relevant people, and determining those is an extremely common and fundamental role of the legal system. Why would such a tax seem strange to you?
sidlls 6y ago
That's a good point: the vacancy tax shouldn't be tied to motivation. It should just be applied across the board. No matter how much housing is built, land and housing will be a relatively scarce resource (we can't make more land, per se, and although we can build higher density housing even that has a limit). It shouldn't matter why a property is vacant in these areas.

by harryh 6y ago

It seems strange to have a tax that is based on the subjective motivations of a property owner. How would you even know why someone wasn't renting out a given property at a given moment in time?

leetcrew 6y ago

what else would someone be doing with a property that they aren't themselves living in? if you support a punitive tax on people holding out for higher rent, you probably don't care if it also hits people who are merely speculating on real estate.

harryh 6y ago
- Maybe they want to move into it later. - Maybe they haven't found a suitable tenant yet. - Maybe they are holding it open for a friend or family member. - Maybe they want to do some renovations before renting it out. - Maybe they want to sell the property and it's easier to sell without an existing tenant. I can think of lots of reasons.
- sudosysgen 6y ago
  >- Maybe they want to move into it later. Then they should lease it meanwhile or pay the tax, it's rare for people to buy houses fully finished, say, a year in advance. >- Maybe they haven't found a suitable tenant yet. They can lower the price to find a suitable tenant faster. >- Maybe they are holding it open for a friend or family member. Then that friend or family can move there officially while still occupying their current dwelling until the grace period expires again. >- Maybe they want to do some renovations before renting it out. These laws in practice have an exemption for rénovations. >- Maybe they want to sell the property and it's easier to sell without an existing tenant. Then they should price it as to sell within the grace period, or pay the tax.
  - harryh 6y ago
    What's so special about housing that you need an extra special tax like this? We don't have it for cars or machinery or other kinds of capital goods. I'll answer my own question: the root problem of too high rents is that governments: 1) have outlawed the construction of enough new housing to meet demand. 2) many places (CA especially) have property taxes that are drastically too low (and in CA's case, radically unfair). Vacancy taxes are a bad hack. As you note in your comment you have to build in all kinds of grace periods or exceptions and even these can often be easily gamed or ignored. Cities will be much better off if they fix the real underlying problems.
    - deleted 6y ago
      [deleted]
    - sudosysgen 6y ago
      This law was implemented in Vancouver. It worked at reducing vacanies. It wasn't gamed, because the fact that a person can only have one residence and that that confers a lot of rights is enough to dissuade it. >What's so special about housing that you need an extra special tax like this? We don't have it for cars or machinery or other kinds of capital goods. Land is not capital. It is not infinitely reproducible. You can't make more land, and as a result there is hard limit to any one kind of housing. >1) have outlawed the construction of enough new housing to meet demand. I agree that this should be fixed >2) in many places (CA especially) have property taxes that are drastically too low (and in CA's case, radically unfair). That is really far from being the reason for high rents, since most places with high rents don't have Prop 13.
      - imtringued 6y ago
        Prop 13 causes all cities in CA to collude against building more housing. Any city that breaks this gets "punished" with the full force of other Californians escaping their poorly planned city.
    - lelandbatey 6y ago
      I cannot manufacture more land downtown, while a car can be manufactured and moved wherever. Land, unlike other capital goods, cannot move to meet demand.
- acdha 6y ago
  There are possible reasons but it’s important to remember that there are also costs: empty buildings don’t contribute to the local culture or economy, and can become an eyesore or attract crime. A tax helps encourage owners to minimize those negatives and could easily be phased in or have an appeal process (e.g. show that you have building permits for a 6 month waiver).

sudosysgen 6y ago

Who cares why? If they can't find a tenant beyond a certain amount of time, they can be made to pay a tax, lower the price to find one faster, or sell.

tshaddox 6y ago

Lots of laws are based on subjective motivations of relevant people, and determining those is an extremely common and fundamental role of the legal system. Why would such a tax seem strange to you?

sidlls 6y ago

That's a good point: the vacancy tax shouldn't be tied to motivation. It should just be applied across the board. No matter how much housing is built, land and housing will be a relatively scarce resource (we can't make more land, per se, and although we can build higher density housing even that has a limit). It shouldn't matter why a property is vacant in these areas.