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Someone who knows more about Japanese culture and tax policy needs to weigh in, but my understanding is that housing is typically not considered a long-term inv
by MengerSponge 5y ago
Someone who knows more about Japanese culture and tax policy needs to weigh in, but my understanding is that housing is typically not considered a long-term investment vehicle, to the point that houses are expected to be demolished after some number of decades and depreciated accordingly.
This mindset prevents an established base of property owners from blocking subsequent development, resulting in their property values skyrocketing.
America might have a chance of fixing this with national-level zoning, which will never happen as long as current political alliances are the way they are.
- srcreigh 5y agoThe way I understand this (as a Canadian) is When most voters own homes, politicians increase home prices When (or if) most voters don't own homes, politicians decrease home prices In your understanding, what is the force which breaks this equilibrium?
- deleted 5y ago[deleted]
- BurningFrog 5y agoI suspect the causality is reversed: Housing is not considered a long-term investment because demolition and new construction is easy.
- asciimike 5y agoReally good article on zoning in Japan: http://urbankchoze.blogspot.com/2014/04/japanese-zoning.html http://urbankchoze.blogspot.com/2014/04/japanese-zoning.html I think it's a bit of both, it's not viewed as as much of an investment therefore zoning laws are lax, which mean that housing can't become an investment because anyone can build (up to) anything on a lot.
- Tiktaalik 5y agoI think the tax code even incentivizes demolition in that the taxes for sales of bare land versus land with a structure on it are less.
- MarkSweep 5y agoIn constraint, California tax policy incentivizes keeping around crappy old buildings. If keep the old building, Proposition 13 limits how much your tax can go up. If you build a nice new building, the state punishes you but reassessing the value of your property. This can greatly increase your property tax if you have owned the property for a while.
- MengerSponge 5y agoMy instinct is that the causal arrow begins with earthquakes and disposable (timber-based) building practices, which keep housing/structures from being viewed as stable long-term vehicles
- xxpor 5y agoSo why didnt California end up in that state, concidering it has nearly the same conditions?
- ac29 5y agoCalifornia is seismically active, but not like Japan: https://upload.wikimedia.org/wikipedia/commons/7/77/EQs_1900-2013_worldseis.png https://upload.wikimedia.org/wikipedia/commons/7/77/EQs_1900...
- MengerSponge 5y agoThat's a very good question. Probably because modern California was settled by European colonizers, who brought their traditional construction and property practices with them? I'd love to see a sociologist's analysis of the ring of fire, though. If anyone knows of someone who isn't just talking out their butt (like me), please drop a rec
- quartesixte 5y ago>That's a very good question. Probably because modern California was settled by European colonizers, who brought their traditional construction and property practices with them? Like lawns! Like California is the completely wrong state for lawns.
- dntrkv 5y agoCalifornia is a massive state with 16 different climate zones. The vast majority of California is not a desert. Lawns are fine in most of the state.