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The solution is actually an "occupancy tax". If you aren't renting out a space within some number of months, you start owing tax on what your financial agreeme
by bsder 3y ago
The solution is actually an "occupancy tax". If you aren't renting out a space within some number of months, you start owing tax on what your financial agreement says is your "rent". The longer you go unoccupied, the higher that tax should get since your unoccupied front winds up contributing to "blight".
- JumpCrisscross 3y ago> If you aren't renting out a space within some number of months, you start owing tax on what your financial agreement says is your "rent" This cascades into consolidation in crisis. Small landholders can’t afford to ride out the trouble. Large ones can.
- toyg 3y agoThresholds are a thing.
- ikiris 3y agoWhat is the problem with removing landlords from an area if their property isn't being utilized?
- blitzar 3y agoYou mind if I remove some money from your bank account that I dont think you are properly utilizing?
- kasey_junk 3y agoThat’s precisely what our current inflationary monetary policy does. You can argue whether that’s good or bad but we have governmental policies that encourage productive use of assets so it’s not out of bounds to suggest other policies for land assets.
- BlueTemplar 3y agoCompanies aren't people.
- blitzar 3y agohttps://en.wikipedia.org/wiki/Corporate_personhood https://en.wikipedia.org/wiki/Corporate_personhood
- gottorf 3y agoCompanies aren't people, but they are started by people, run by people, employ people, and owned by people.
- fragmede 3y agoWhat do you call a "people" that doesn't have to be responsible for their actions? Sociopath?
- ikiris 3y agoMy bank account isn't preventing you from living in a space.
- zuminator 3y agoI readily admit I have no idea if this would be feasible in practice, but what's to stop landlord ABC, Inc from skirting the law by setting up shell company XYZ, LLC, and then leasing the vacant space to that company? In this scenario, XYZ would essentially just pay themselves rent causing ABC to avoid the vacancy tax.
- bsder 3y agoIs that not fine? You are collecting tax on rental income so there is still a strong incentive to put someone else in there. And, if you have a financing agreement, you will have to shuffle around (and pay tax on) the rent that you officially declare in the financing agreement. You can't just put a nominal rent on it or that violates the financing agreement. The overall point is simply to make reducing the rent to attract a tenant more attractive than leaving the place empty for multiple years.
- ethanbond 3y agoBy leasing at $10/mo to your shell corp?
- bsder 3y agoThen you would violate your financing agreement as the rent would be below the capitalization threshold and you would have to cough up money to the bank. I don't think you understand the issue. The issue here is that many of these financing agreements specify a minimum rent and if you fall below that you are in violation of the capitalization requirements and you owe the bank money. By contrast, missing rent is considered a temporary condition and can be tacked onto the back end of the financing agreement. So, zero rent does not cause capitialization issues, but lower rent does. Thus, landlords have a perverse incentive to leave a place unrented rather than lower the rent. An occupacy tax breaks that perverse incentive. The goal isn't to grind up landlords. The goal is to cause rents to come down when they should. Right now, the back end financing agreements are keeping rents artificially inflated.
- ethanbond 3y agoJust institute a high LVT so it’s economically infeasible to keep real estate off the market. No need to assess what’s occupied or not.