It's funny and hard to believe for many that it wouldn't matter if such tax on land is 2% or 50% or 90% and still effective. - at 0% the price ceiling is inf

It's funny and hard to believe for many that it wouldn't matter if such tax on land is 2% or 50% or 90% and still effective. - at 0% the price ceiling is infinite, so the price tends to climbs up to infinity, up to affordability, which due to close to zero interest rates is also almost unbounded - at 2% many vacant houses start returning back to the market since it no longer pay off to wait indefinitely for a greater fool to buy it from you. Price starts to equalize, because suddenly the market starts to clear again - at 50% of land tax, the only thing changes is that the land price is reduced, all else being equal. In such a market you pay 50% tax on the parcel to government and 50% to the land owner (current leassee). - At 100% of land tax the price of land is further reduced to almost optimal market clearing price. It is now equivalent to renting the land directly from the government. There is no longer any "private tax" paid to the land owner. The land is now rented only if the acticity performed on it outweights the benefit of the tax. The price is now determined purely based on market terms and actually affordable to many. It helps to understand that real estate prices today are mostly land value dominated. Construction material and labor is highly mobile so price of houses is virtually the same everywhere withing the same country. It's all land price in disguise. The house crumbles down eventually and eg. in Japan the price of a house is 0 or negative (destruction cost) after only 30years. It's the same in the west, but people choose to pretends it's not, because all their net worth is stored in that crumbling ruin of theirs.