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The problem with the 30 year lease idea is that it heavily discourages investment. Why would you build a billion dollar skyscraper when the state will reposes i
by HDThoreaun 4y ago
The problem with the 30 year lease idea is that it heavily discourages investment. Why would you build a billion dollar skyscraper when the state will reposes it in 30 years? What we need is perpetual leases that charge the full value of the land. We need LVT
- jjoonathan 4y agoThe "give or take" caveat was intended to cover different terms for different zones. 99 year leases might make sense to incentivize green-field development, 45 years might make sense for heavy infrastructure (going by depreciation rules), and 30 years is calibrated more towards families. Lower durations could be sold as extenders or to synchronize move-outs in place of eminent domain. The exponential decay of net-present-value calculations means that time horizons do not have to be infinite to encourage investment. Making them infinite doesn't even help very much at all. When you compare this against the dramatically higher capital requirements of the perpetual ownership model, it actually has very little to offer. Except ensuring that rich people can get paid for being rich, of course, which one starts to suspect is the actual purpose. I want leases, but I'd settle for LVT.