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Comment by xyzzyz | Hacker News Reader

The buildings in the unfashionable part of the town don’t get torn down, it’s actually opposite — they are getting torn down in fashionable parts to make place for new ones, precisely because it is fashionable place to build. People hardly ever demolish structures to keep the lot empty — it’s an extra cost without any payback, and the old structure may be useful to some buyers, so destroying it would not only be expensive, but it would also destroy some value. If the existing structure is no good for anyone, then the cost of tearing it down is incorporated in the value of the lot, and the buyer will do it, there is no need for seller to spend money on that.

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Sigh I wish you weren’t wrong but sadly you are. We demolished both of our closed buildings because the cost of not doing so (fucking transients are not free, land owners somewhere are paying for them) is higher than the cost of just demolishing the building.

One thing you see frequently in old ruins is people tearing apart old buildings for the building materials.

Not to mention property taxes on empty buildings.

The alternative is having people buy a building, not do anything with it, and wait for the price to increase to sell it at a profit. Leading to a shortage of real estate with a ton of unused real estate.

And no, we can't just wait for the market to self-correct for empty properties being devalued due to being surrounded by empty properties: you'll just end up with empty, abandoned buildings that nobody wants to fix.

If you want incentives to make people avoid doing that, the only two methods that I can think of are property tax, or legalised squatting (with squatters having a right to stay).

All buildings require significant ongoing maintenance to avoid demolition and many have a way of mysteriously burning down when the insurance value exceeds the market value. To learn more from recent US history search “The Bronx is burning” and dig a little.

Historically people used to dismantle buildings quite frequently in order to reuse the building materials. Stone from the abandoned building on the other side of town is just as good as stone from the quarry 200 miles away.

> People hardly ever demolish structures to keep the lot empty

What up property tax? In my city you get reduced property tax (but not zero) if it's commercial building that is empty and unused, but I can imagine there are cities where demolishing an empty building is more cost effective than paying property tax on it every year.

Most property value is in land, not buildings over it. Sometimes buildings carry extra premium, e.g. when zoning wouldn’t allow to build it again, but if we are talking about tearing buildings down, this is probably not the situation we are in. Thus, demolishing the building doesn’t decrease property value by much more than it costs to build it.

On the other hand, demolishing it also costs money, and with property tax rates on the order of 1% or less, it will only return in something like a decade.

Yet another reason why property tax needs to be replaced by land-value tax.

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