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Because a revenue neutral implementation lowers taxes on net on improved active sites that do something with land, and raises it on net for vacant abandoned sit

Because a revenue neutral implementation lowers taxes on net on improved active sites that do something with land, and raises it on net for vacant abandoned sites that do nothing, shifting the incentive to do something with the land or sell it to someone who will.

fuzzfactor 1y ago
Texas already has exorbitantly high property taxes, more than most, that's why perfectly good buildings are often torn down. Nice buildings where that would not happen in other states. Because it allows the appraisal value to plummet and the owner to continue to own the property when nothing other than a drastic reduction in this yearly siphoning (which never stops increasing) will do. Remember the purpose of property tax to begin with is for the owner to lose the property in case they are not as wealthy as someone else who might be interested someday. Or in case the property itself can not provide more than enough income to pay the tax in a timely way. Another problem is that taxes were always high but they didn't actually start skyrocketing until a few decades ago, after one of the key stabilizing anti-Carpetbagger laws which prevented home equity loans, was repealed. And the sky's the limit whenever untapped wealth is unleashed, to be audited and appraised. So it's been kind of a race between property appreciation, available equity to borrow against as values increase, versus tax rates and appraisals trying to capture more of that in ways that can only result in owners becoming less whole that it ever has been. Revenue-neutral or not, anything that makes it worse makes it worse.
- rafabulsing 1y ago
  A land value tax is based on the value of the land only, with no input from whatever improvements are or are not built on it. So, with a proper LTV implementation (i.e., one where LTV is the only tax incurred on real state), there would be literally no tax incentive to tear down a usable (but unused) building. You would be paying the exact same amount of taxes on an empty lot as on a high end modern building on that same lot.
  - fuzzfactor 1y ago
    What you say does make sense because it's got to be better than what things have evolved into in so many misguided places. But I forgot to add that the amount of revenue from property tax is only intended to act like collateral damage :) When you do the math it turns out anytime you start taxing anything but commerce, it is unsustainable because it accrues and accumulates disadvantage to the taxpayer until it is overwhelming. Plus the higher that taxes rise above absolute insignificance, the more likely a major upset occurs from just a slight lapse in overall prosperity, re-balancing to the further disadvantage against those who can afford it least. And that doesn't include the pulling of political strings by those who benefit most from that type activity. You don't sensibly tax people just for existing, even at 3/5 the amount per head. Likewise their property unless it is involved in commercial activity, nor wage income since the employer is the commercial enterprise they should have that all covered like it used to be when things were not so predatory. But they tax "rooftops" like a lot of other places based on square footage and now in Houston there has been some recent influence to demolish unoccupied buildings more so for appearance sake to the world for the upcoming World Cup as an excuse more than anything else. It appears the actual demolition of truly abandoned buildings can not be accelerated without blurring the lines between actual abandonment and merely unoccupied to some degree or another. But appearances can be deceiving. The big thing is there's enough people much wealthier than those who have the properties now, who want them either way, demolished or not. Under threat of forced demolition those having buildings suitable for rehab would need to sell for less than they would have otherwise. Who cares about the poor sellers who have been paying taxes on the buildings the whole time, working toward a financial turnaround? The idea seems to be to incentivize new buyers to have better opportunities by preying on previous owners' misfortune. OTOH, as soon as any property has had any nonproductive structures removed, its appraised value and tax levy drops like a rock, making it way more attractive for the same type buyers who could have already obtained all the lots having buildings they are willing to rehab. The new buyers can then afford many more vacant lots for potential future construction, which had always been a non-bonanza prospect otherwise, and with the newly lowered taxes afford to wait and see which might be a bonanza to build on someday. A lot more so than the previous owners. If a lot of this happens at the same time, then the market for reclaimed lots like this will have downward price pressure too until the effect runs its course. Too bad for the little guy either way.
- wffurr 1y ago
  >> that's why perfectly good buildings are often torn down. Nice buildings where that would not happen in other states. Because it allows the appraisal value to plummet and the owner to continue to own the property when nothing other than a drastic reduction in this yearly siphoning This is exactly the problem that Land Value Tax proposes to fix. The tax doesn’t go down if the land owner destroys their structures and ruins the site.
  - fuzzfactor 1y ago
    See my other message. The owners don't want to destroy the structures at all. They've been holding onto the properties because appreciation was outpacing taxation, allowing a predictable path to remodeling and re-habitation. Until that changed. Primarily from greedier investors not having enough low-hanging fruit to pick from so they're shaking the trees for all they have until they can give no more. It's new buyers instead that want to swoop in if the landscape can be further tilted in their favor. Just a little bit is all it takes to yield a big return for a privileged few. Other costs have risen too but the taxes are so high that's what triggers the final destruction. Property tax has that extra-financial "property" that keeps your home positioned like dominos ready to fall. Like other skyrocketing costs don't do, even though the pressure from them is huge too. This is by design. LVT wont help you now. It's too late.

fuzzfactor 1y ago

Texas already has exorbitantly high property taxes, more than most, that's why perfectly good buildings are often torn down. Nice buildings where that would not happen in other states. Because it allows the appraisal value to plummet and the owner to continue to own the property when nothing other than a drastic reduction in this yearly siphoning (which never stops increasing) will do. Remember the purpose of property tax to begin with is for the owner to lose the property in case they are not as wealthy as someone else who might be interested someday. Or in case the property itself can not provide more than enough income to pay the tax in a timely way. Another problem is that taxes were always high but they didn't actually start skyrocketing until a few decades ago, after one of the key stabilizing anti-Carpetbagger laws which prevented home equity loans, was repealed. And the sky's the limit whenever untapped wealth is unleashed, to be audited and appraised. So it's been kind of a race between property appreciation, available equity to borrow against as values increase, versus tax rates and appraisals trying to capture more of that in ways that can only result in owners becoming less whole that it ever has been. Revenue-neutral or not, anything that makes it worse makes it worse.

rafabulsing 1y ago
A land value tax is based on the value of the land only, with no input from whatever improvements are or are not built on it. So, with a proper LTV implementation (i.e., one where LTV is the only tax incurred on real state), there would be literally no tax incentive to tear down a usable (but unused) building. You would be paying the exact same amount of taxes on an empty lot as on a high end modern building on that same lot.
- fuzzfactor 1y ago
  What you say does make sense because it's got to be better than what things have evolved into in so many misguided places. But I forgot to add that the amount of revenue from property tax is only intended to act like collateral damage :) When you do the math it turns out anytime you start taxing anything but commerce, it is unsustainable because it accrues and accumulates disadvantage to the taxpayer until it is overwhelming. Plus the higher that taxes rise above absolute insignificance, the more likely a major upset occurs from just a slight lapse in overall prosperity, re-balancing to the further disadvantage against those who can afford it least. And that doesn't include the pulling of political strings by those who benefit most from that type activity. You don't sensibly tax people just for existing, even at 3/5 the amount per head. Likewise their property unless it is involved in commercial activity, nor wage income since the employer is the commercial enterprise they should have that all covered like it used to be when things were not so predatory. But they tax "rooftops" like a lot of other places based on square footage and now in Houston there has been some recent influence to demolish unoccupied buildings more so for appearance sake to the world for the upcoming World Cup as an excuse more than anything else. It appears the actual demolition of truly abandoned buildings can not be accelerated without blurring the lines between actual abandonment and merely unoccupied to some degree or another. But appearances can be deceiving. The big thing is there's enough people much wealthier than those who have the properties now, who want them either way, demolished or not. Under threat of forced demolition those having buildings suitable for rehab would need to sell for less than they would have otherwise. Who cares about the poor sellers who have been paying taxes on the buildings the whole time, working toward a financial turnaround? The idea seems to be to incentivize new buyers to have better opportunities by preying on previous owners' misfortune. OTOH, as soon as any property has had any nonproductive structures removed, its appraised value and tax levy drops like a rock, making it way more attractive for the same type buyers who could have already obtained all the lots having buildings they are willing to rehab. The new buyers can then afford many more vacant lots for potential future construction, which had always been a non-bonanza prospect otherwise, and with the newly lowered taxes afford to wait and see which might be a bonanza to build on someday. A lot more so than the previous owners. If a lot of this happens at the same time, then the market for reclaimed lots like this will have downward price pressure too until the effect runs its course. Too bad for the little guy either way.
wffurr 1y ago
>> that's why perfectly good buildings are often torn down. Nice buildings where that would not happen in other states. Because it allows the appraisal value to plummet and the owner to continue to own the property when nothing other than a drastic reduction in this yearly siphoning This is exactly the problem that Land Value Tax proposes to fix. The tax doesn’t go down if the land owner destroys their structures and ruins the site.
- fuzzfactor 1y ago
  See my other message. The owners don't want to destroy the structures at all. They've been holding onto the properties because appreciation was outpacing taxation, allowing a predictable path to remodeling and re-habitation. Until that changed. Primarily from greedier investors not having enough low-hanging fruit to pick from so they're shaking the trees for all they have until they can give no more. It's new buyers instead that want to swoop in if the landscape can be further tilted in their favor. Just a little bit is all it takes to yield a big return for a privileged few. Other costs have risen too but the taxes are so high that's what triggers the final destruction. Property tax has that extra-financial "property" that keeps your home positioned like dominos ready to fall. Like other skyrocketing costs don't do, even though the pressure from them is huge too. This is by design. LVT wont help you now. It's too late.