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This is why I distinguished it as asset class vs asset. It should be primarily tied to the value of the land beneath plus some nominal appreciation for the buil
by no_wizard 3y ago
This is why I distinguished it as asset class vs asset. It should be primarily tied to the value of the land beneath plus some nominal appreciation for the building on top rather than assessed value of the building on top plus nominal appreciation of the land. Similar to the land value tax formula. This treats it closer to a commodity rather than its own asset class as it is today.
This makes it more of a modest investment overall, one that people would stop tying their entire net with to
Deferring tax increases based on the sale of a house until the next owner is what California does and it’s a disaster.
Land value taxes are more equitable and treat it closer to a commodity and drive more efficient utilization
- IG_Semmelweiss 3y ago>>>> tied to the value of the land beneath >>>plus some nominal appreciation for the >>building on top I'm not sure i agree with this take. The building is clearly a depreciating asset. If left alone the house will eventually be worth nothing because a decrept properly carries liabilities instead (neighborhoid fire hazard, penalties , fees etc) So there no nominal value there. Onward to the land. The only real reason for land to appreciate is because it ia scarce resource. But then you see that the land also has a carrying cost (taxes) that is fixed regardless of its use. Therein lies the dilemma. If land is an asset that generates expense , and then that expense only grows as time passes but theres no income associated with it, are you really seeing land appreciation when you sell, or are you simply recouping your carrying cost during the term it was held?
- no_wizard 3y agoThis will explain it better than I can: https://en.m.wikipedia.org/wiki/Land_value_tax https://en.m.wikipedia.org/wiki/Land_value_tax