4 ms·

If a retiree was sitting on highly valuable land, why couldn't they just get a reverse mortgage? High home equity plus short remaining life expectancy will supp

• Ericson2314 5y ago
  LVT should be quite high to make that not work: you should have to sell your land to someone that will develop it to cash in, otherwise your cashing in isn't worth it to society.
  • rcpt 5y ago
    I don't think anyone's seriously advocating for a tax so high that you couldn't pay it with loans for a few years.
    • Ericson2314 5y ago
      They actually are. As LVT goes up, the price of ownership goes down as land becomes a bit of a "hot potato". That's actually fine: what we are left with in the extreme is all land is rented from the state, and there is no permanent ownership. That's great! You don't have to go that far, but it's good to know it's "safe" to do so. Land isn't produced so there's no "100 Laffer curve is 0" type problem in the slightest.
      • epistasis 5y ago
        Even if you capture 100% of the increase in land value with land rents, that's only been about 5%-10% per year in hot markets. And even as you're taking out loans for last year, there's additional increases you can borrow more money from. So people that truly don't care about profiting from their land can handle it pretty much indefinitely. However, once you can no longer gain money from speculating on its increase in value, that also means that there's going to be a ton more land available for increased use. The coercive effect of a land value tax is balanced by the a reduction in people speculating.
• bluGill 5y ago
  For practical purposes many reverse mortgages are rip offs. the idea is sound, but few get a fair deal.