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> Now do houses. Why is the first $500k of real estate appreciation untaxed? Because it encourages liquidity in the housing market. If people had to pay taxes
by jjav 3y ago
> Now do houses. Why is the first $500k of real estate appreciation untaxed?
Because it encourages liquidity in the housing market. If people had to pay taxes on the sale as soon as the house appreciates anything, a lot more people would hold on to the house and never let go.
- jeffbee 3y agoAnd yet we have less mobility than ever. Curious.
- geysersam 3y ago> a lot more people would hold on to the house and never let go. Subsidizing a behavior we would like to see. As always, the rich gets the carrot and the poor gets the stick. Luckily the same economic theory can be applied to motivate both.