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Rental rates should always be set at the highest that the renters can afford according to the supply/demand curve. If you raise taxes and rental rates go up, th
by ItsMonkk 5y ago
Rental rates should always be set at the highest that the renters can afford according to the supply/demand curve. If you raise taxes and rental rates go up, that means they were leaving money on the table previously.
If the rental rates were set correctly, none of the extra taxes can be passed on. The most likely result is the price of the buildings will go down and new renters will be able to buy in more cheaply but get less per rental.
Once again the Land Value Tax shows its brilliance.
- b9a2cab5 5y agoLand Value Tax says you tax land at a (high) flat rate per area regardless of value to encourage density. That is entirely different from higher property taxes on landlords (which would not lower rents but might lower property values). I agree that LVT would make a huge improvement if it was set high enough though. But it will never happen when you have homeowners leveraged up 20x on govt subsidized mortgages who vote for themselves.